Canada makes plans in case Keystone not approved – ExxonMobil CEO

13 March 2013 21:16 Source:ICIS News

HOUSTON (ICIS)--As US president Barack Obama continues to contemplate a decision on the proposed Keystone XL pipeline, Canadian officials are not sitting idly by, ExxonMobil CEO Rex Tillerson said on Wednesday.

The pipeline, a project of TransCanada, would cross the border between the US and Canada, transporting oil from Hardisty, Alberta, and the Bakken shale formation in the US to Nebraska and eventually to refineries along the US Gulf Coast.

In January 2012, Obama rejected a permit for the pipeline, saying the deadline did not allow for enough time to fully weigh the project’s impact.

Then, on 22 January 2013, Nebraska’s governor, Dave Heineman, announced the approval of a revised route for the pipeline. Approval from Nebraska was the main obstacle preventing the construction of the project, as the governor had not previously supported the pipeline plan through his state.

Now the fate of the pipeline again lies with Obama, who is expected to decide on it by mid-year.

But Tillerson intimated on Wednesday during ExxonMobil’s annual analysts day that Canadians have been formulating other plans in case the US does not approve the project.

“The Canadian government is not going to sit still, either,” he said. “They are going to want to deal with this issue, too. All of those solutions aren’t necessarily south, and I think we all should just keep that in mind.”

Canada has been exploring building a pipeline from the Alberta tar sands to British Columbia on its west coast. Doing so would give the country much easier capabilities to export to crude-thirsty Asian countries such as China.

At present, about 99% of Canada’s crude oil exports go to the US.

By Jeremy Pafford