TransCanada

As the mid-term elections in the United States continue to heat up, a new report released Wednesday shows that Canadian corporations have registered at least $15.3 million USD in spending on direct lobbying of the U.S. federal government in the first nine months of 2014.

That includes $2.87 million by Canadian National Railway Company in the face of increasing regulatory attention to the rail transport industry on both sides of the border, said the report — Are Canadian corporations spending to influence the U.S. political process?

Written by The Shareholder Association for Research and Education (SHARE), the 13-page report noted that the TransCanada Corporation, well aware that the controversial Keystone pipeline project is up for approval at the federal level, spent $1.07 million on political lobbying from January to September.

The author of the report, Kevin Thomas, SHARE’s Director of Shareholder Engagement, said in a telephone interview that Canadian companies are clearly involved in political spending in the U.S.

“The problem is there’s no real requirement for disclosure on either side of the border that can quantify the extent of that spending,” Thomas said.

Six years have passed since TransCanada originally sought a permit for the Keystone XL pipeline, and Republicans in Washington have not given up fighting for the project. In spite of the fact that the pipeline will create fewer than 40 permanent jobs; would pose serious risks to potable water supplies; and would potentially raise energy prices for American consumers, some of our elected officials still believe that the pipeline would be a boon for the United States.

In the last week, the Republican-led efforts to force President Obama to approve the disaster of a plan have reached a fevered pitch. To begin with, to mark the 6^th anniversary of the original permit application, every single Republican in the U.S. Senate signed a letter to President Obama demanding that he take action and approve the pipeline.

In the letter, Republican Senator John Hoeven (R-ND) played on the fears of American citizens while trying to force an approval. Hoeven wrote:  “After more than six years of study, five favorable environmental reviews, numerous polls showing the support of the American people, ISIS and the turmoil in the Middle East, it is way past time we take off the blinders and do what is in the best interest of the United States: approve the Keystone XL pipeline.”   

Not to be outdone, Senate Minority Leader Mitch McConnell made an appeal to the American public (and the dirty energy industry) by making the bold claim that, if Republicans gain control of the Senate in this year’s midterm elections, the Keystone XL pipeline will be one of their top priorities. McConnell claimed, “If we have a new majority next year, and a new majority leader, the Keystone pipeline will be voted on on the floor of the Senate, something the current majority has been avoiding for literally years.”

Even before the anniversary of the application, Senate Republicans were hard at work trying to force the project’s approval. A few days before they sent a letter to the President, Senate Republicans (and a West Virginia Democrat) introduced a bill that would strip the President of his authority to approve pipeline projects, and would limit the review period by the State Department down to 120 days. According to The Hill, the Republican-controlled U.S. House of Representatives passed a similar bill back in June.

On the Friday before Labor Day — in the form of an age-old “Friday News Dump“ — the Federal Energy Regulatory Commission (FERC) handed a permit to Enbridge, the tar sands-carrying corporate pipeline giant, to open a tar sands-by-rail facility in Flanagan, Ill. by early-2016. 

With the capacity to accept 140,000 barrels of tar sands product per day, the company's rail facility serves as another step in the direction towards Enbridge's quiet creation of a “Keystone XL Clone.” That is, like TransCanada's Keystone Pipeline System sets out to do, sending Alberta's tar sands all the way down to the Gulf of Mexico's refinery row — and perhaps to the global export market.

Flanagan sits as the starting point of Enbridge's Flanagan South pipeline, which will take tar sands diluted bitumen (“dilbit”) from Flanagan to Cushing, Okla. beginning in October, according to a recent company earnings call. From there, Enbridge's Seaway Twin pipeline will bring dilbit to Port Arthur, Texas near the Gulf.

Enbridge made the prospect of a tar sands-by-rail terminal public for the first time during its quarter two investor call.

“In terms of the rail facility, one of the things we're looking at is – and the rail facility is really in relation to the situation in western Canada where there is growing crude oil volumes and not enough pipeline capacity to get it out of Alberta for a two or three year period,” Guy Jarvis, president of liquids pipelines for Enbridge, said on the call.

“So, one of the things we're looking at doing is constructing a rail unloading facility that would allow western Canadian crudes to go by rail to Flanagan, be offloaded, and then flow down the Flanagan South pipeline further into Seaway and to the Gulf.”

FERC has given Enbridge the permit it needs to make that happen.

The Sierra Club, National Wildlife Federation (NWF) and other green groups recently revealed that pipeline giant Enbridge got U.S. State Department permission in response to its request to construct a U.S.-Canada border-crossing tar sands pipeline without earning an obligatory Presidential Permit.

Enbridge originally applied to the Obama State Department to expand capacity of its Alberta Clipper (now Line 67) pipeline in November 2012, but decided to avoid a “Keystone XL, take two” — or a years-long permitting battle — by creating a complex alternative to move nearly the same amount of diluted bitumen (“dilbit”) across the border.

The move coincides with the upcoming opening for business of Enbridge's “Keystone XL” clone: the combination of the Alberta Clipper expansion (and now its alternative) on-ramp originating in Alberta and heading eventually to Flanagan, Ill., the Flanagan South pipeline running from Flanagan, Ill. to Cushing, Okla. and the Cushing, Okla. to Port Arthur, Texas Seaway Twin pipeline.

Together, the three pieces will do what TransCanada's Keystone XL hopes to do: move dilbit from Alberta's tar sands to Port Arthur's refinery row and, in part, the global export market.

Environmental groups have reacted with indignation to the State Department announcement published in the Federal Register on August 18. The public commenting period remains open until September 17.

Jim Murphy, senior counsel for NWF, referred to it as an “illegal scheme,” while a representative from 350.org says Enbridge has learned from the lessons of its corporate compatriot, TransCanada.

“When we blocked Keystone XL, the fossil fuel industry learned that they have a much stronger hand to play in back rooms than on the streets,” said Jason Kowalski, policy director for 350.org. “They will break the law and wreck our climate if that's what it takes for them to make a buck.”

But as the old adage goes, it takes two to tango. 

That is, influential State Department employees helped Enbridge find a way to smuggle an additional 350,000 barrels of tar sands per day across the border without public hearings or an environmental review.