Resurrecting Energy East: How to bring a dead pipeline back to life

by Jameson Berkow (feat. Dennis McConaghy)

BNN Bloomberg
June 1, 2018

Nationalizing Trans Mountain has revived interest in another oil sands pipeline: Energy East. TransCanada’s  $15.7-billion plan to ship more than a million barrels per day from northern Alberta to Canada’s Atlantic coast was cancelled last year. While politics was among the factors that killed the project, some are now suggesting Canada’s federal government should revive Energy East as well. Below,

BNN Bloomberg explains the three (not so) easy steps Ottawa could take if it wanted to bring the dead project back to life.

GET THE PROPONENTS BACK ON BOARD

Even if the federal government said it would do everything within its power to see Energy East built, there is no guarantee the project’s original backers would still be interested. Asked whether TransCanada would be willing to revive Energy East if Ottawa offered its support, a company spokesperson declined comment. Irving Oil had originally signed up to build a $300-million export terminal at the pipeline’s planned endpoint near Irving’s refinery in Saint John, New Brunswick. In the hours after Finance Minister Bill Morneau announced the government’s $4.5-billion deal to buy Trans Mountain on Tuesday, Irving Oil CEO Jim Irving gave a speech where he called Energy East “absolutely essential.” However, the company did not respond to multiple requests whether Irving would even be interested in seeing the project revived.

RESTART THE REGULATORY REVIEW

Unlike Trans Mountain, Energy East never completed the National Energy Board review process and thus never won formal regulatory approval. The NEB’s Sarah Kiley confirmed via email TransCanada “withdrew their application, so if the company were to decide they now wanted to go ahead with the project, they would need to reapply to the NEB and re-start the review process.” Given the original Energy East application amounted to nearly 40,000 pages, it seems safe to assume it would take some time before a new application could be submitted. Even then, only when the NEB deems the application complete would the clock start on a new 21-month review process. That means just getting shovels in the ground to begin several years of construction on Energy East would itself take several years.

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