Democracy Gone Astray

Democracy, being a human construct, needs to be thought of as directionality rather than an object. As such, to understand it requires not so much a description of existing structures and/or other related phenomena but a declaration of intentionality.
This blog aims at creating labeled lists of published infringements of such intentionality, of points in time where democracy strays from its intended directionality. In addition to outright infringements, this blog also collects important contemporary information and/or discussions that impact our socio-political landscape.

All the posts here were published in the electronic media – main-stream as well as fringe, and maintain links to the original texts.

[NOTE: Due to changes I haven't caught on time in the blogging software, all of the 'Original Article' links were nullified between September 11, 2012 and December 11, 2012. My apologies.]

Tuesday, November 01, 2011

TransCanada warns against review of Keystone XL route

TransCanada Corp. (TRP-T42.09-0.28-0.66%) has issued a stark warning over the lengthy delay that will be created if Nebraska succeeds in demanding a new route for its Keystone XL project.

State legislators begin a special session Tuesday afternoon to consider a rule that would enable them to move the controversial pipeline away from sensitive ecological areas.

TransCanada has marshalled legal opinions questioning the state’s ability to enact such a rule. And it has cast doubt on whether a such a bill will even garner enough political support to pass.

But on Tuesday morning, it also warned that forcing a new route could delay construction of the pipeline by more than three years – and, it suggested, the refineries whose contracts underpin the project may not stick around that long.

“If the route is arbitrarily moved to another location, we would suspect that we would have to restart” an environmental review process, TransCanada chief executive officer Russ Girling said in a corporate conference call.

Given that the current environmental review process for Keystone XL has now stretched across 38 months, “there’s no reason for us to suspect that a review of a new route would take any less time than the review of this route,” he said.

Such a delay could have a tremendous impact on the $7-billion project. TransCanada has spent years – and already spent some $1.9-billion – to secure land access and pre-purchase equipment for construction of the pipe. Keystone XL would connect the oil sands and new supplies of Montana and South Dakota oil with refineries on the Gulf Coast.

More important, such a delay could convince companies to back out from contracts to ship on the line. TransCanada has, so far, secured contracts for 975,000 barrels per day out of the 1.3 million barrels it has proposed with the entire Keystone system – including Keystone XL and stretches of pipe already built to the U.S. midwest.

But those contracts include sunset clauses that allow would-be shippers to back out. And, Mr. Girling warned, refiners have looked to Keystone XL to fill the void created by expiring contracts for Mexican and Venezuelan supply in 2012 and 2013.

“Those shippers will only wait so long,” he said.

He suggested that U.S. environmental interests will be worse served if refineries turn instead to oil imports brought to the Gulf Coast by tanker. Delaying Keystone XL could also lead to greater tanker traffic off the Canadian West Coast, he warned, based on a belief that growing oil sands output would be exported to Asia from places like Kitimat or Burnaby, B.C.

That “increases the chance of environmental risk. And at the same time, given that those tankers are fuelled by Bunker C fuel oil, we’d see an increase in greenhouse gas emissions,” he said. “So we’d see a net negative impact to the environment as a result of that kind of decision.”

The Nebraska legislative calendar devotes at least five days to deliberation of pipeline siting rules, at least some of which are expected to be introduced and discussed Tuesday afternoon.

There are competing views, however, on whether Nebraska can enact such a rule without falling afoul of constitutional requirements banning interference with interstate commerce.

On Tuesday, TransCanada reported quarterly comparable earnings of $417-million, up 11 per cent over the previous year. Its per-share earnings rose 9 per cent, partly on the strength of its power generating assets, which in Alberta have seen strong pricing.

UBS Securities analyst Chad Friess noted a 126 per cent year-over-year increase in its western and eastern power segments. Part of that increase, however, came from funds that are in dispute, given a current battle between TransCanada and TransAlta Corp. over the shutdown of two power generating units.

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