TransCanada Abandons Quebec Oil Terminal for Beluga Whales

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TransCanada Corp., the company seeking to build the Keystone XL pipeline, scrapped plans for an oil export terminal in Quebec after opponents said it would threaten beluga whales.

The terminal planned for Cacouna was part of the Energy East proposal, which would offer Alberta’s oil sands producers waiting for Keystone another way to reach customers by shipping across Canada to the Atlantic Coast. The C$12 billion ($9.5 billion) project would be North America’s largest oil pipeline.

“This decision is the result of the recommended change in status of the Beluga whales to endangered and ongoing discussions we have had with communities and key stakeholders,” Chief Executive Officer Russ Girling said in a statement Thursday. “We have listened and our decision reflects that.”

TransCanada also pushed back the projected start date for the pipeline by two years to 2020.

The company is considering other terminal options in Quebec. TransCanada proposed Energy East after facing delays in the U.S. on its planned $8 billion Keystone XL pipeline from Alberta to Steele City, Nebraska, first proposed in 2008. The Calgary-based company agreed to change the route of the project in Nebraska after objections from state officials and environmental groups. Keystone is still awaiting a U.S. presidential permit.

Critics of Energy East have raised the specter of a pipeline spill into drinking water supplies and higher greenhouse gas emissions associated with Canadian crude, the same attacks used by Keystone opponents in the U.S. to delay that project.

Endangered Whales

TransCanada in December halted work on the Quebec terminal on the St. Lawrence River after a Canadian wildlife organization said the whales were endangered. Environmental and community groups had also flagged the risks tanker traffic may pose to beluga calving.

The Committee on the Status of Endangered Wildlife in Canada said in a December report that the whales, the world’s southern-most beluga population, are at greater risk of extinction than a decade ago. Quebec Premier Philippe Couillard said the report would make it difficult for TransCanada to build the terminal in Cacouna, about 200 kilometers (124 miles) northeast of Quebec City.

The pipeline project including a Quebec terminal would create 7,319 direct and associated jobs during construction and operations over 40 years, according to a report prepared for TransCanada by Deloitte & Touche LLP. During development and construction alone, Quebec would receive 31 percent of the jobs, the largest among provinces along the route, the report said.

Economic Benefits

If a terminal is not built, the economic benefits to the province would be zero, according to Quebec’s opposition Parti Quebecois party.

TransCanada applied to Canada’s National Energy Board in October to build Energy East, which would carry as much as 1.1 million barrels a day and stretch 4,600 kilometers from Alberta to New Brunswick.

TransCanada has a marine terminal planned in Saint John, New Brunswick, at the end of the pipeline. Irving Oil Ltd., owner of Canada’s largest oil refinery nearby, is TransCanada’s joint-venture partner in the terminal and would operate the facility.

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