Photo: Government of Alberta

By Chris Brown

Keystone XL Benefits

Premier: Keystone XL expected to generate $30B for Alberta over 20 years

Mar 31, 2020 | 3:09 PM

Alberta Premier Jason Kenney says the Keystone XL Pipeline is expected to lead to higher oil prices, increased volumes of oilsands crude and generate at least $30 billion in increased royalties over the next 20 years.

Kenney spoke from Calgary hours after the announcement that TC Energy Corp. would be going ahead with project following an agreement with the Alberta government.

The premier said the timing is as good as it can be for the project to go ahead, even as the world grapples with the COVID-19 pandemic.

“The current crisis calls for dramatic action now to create jobs and joltline our economy back to life in the future.”

Kenney said shovels will be in the ground tomorrow (April 1) and hiring will begin immediately.

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Nearly 3,000 jobs are expected to be created by the project. Kenney said there would be 1,400 direct high-paying jobs in Alberta, 1,200 in Saskatchewan and 300 elsewhere in Canada. He also estimated there would be 12,000 indirect jobs including more than 5,000 in Alberta.

“Together with the national government, we are supporting families and employers facing financial stress right now,” Kenney said. “Following the pandemic we will launch a bold economic recovery package. That plan will accelerate the diversification of alberta’s economy. But it will also ensure a future for our largest industry.”

“When we get through the crisis and the world economy moves back to growth, it will be more obvious than ever that the world needs a reliable, democratic major source of energy. But that will only happen if our energy has access to world markets. In other words, it will only happen if we get pipelines built.”

The 1,947-kilometre project will be able to carry 830,000 barrels per day of crude oil from Hardisty, Alta., to Steele City, Neb. where it will connect with TC Energy’s existing facilities.

The company formerly known as TransCanada says with pre-construction activities underway, the pipeline is expected to enter service in 2023.

The Alberta government has agreed to invest approximately $1.5 billion (US$1.1B) as equity in the project, which substantially covers planned construction costs through the end of 2020.

The remaining $9.7 billion (US$6.9B) is expected to be funded through a combination of a $6-billion (US$4.2B) project level credit facility to be fully guaranteed by the Alberta government and a $3.8 billion (US$2.7B) investment by TC Energy.

(With files from the Canadian Press)