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Keystone Pipeline Rejection Elicits Disappointment In Canada

“It was not necessary to be quite so critical in the way they described our energy product."

OTTAWA — U.S. President Barack Obama’s decision to reject a massive cross-border pipeline was greeted Friday with disappointment and some slight annoyance in Canada.

Canadian Prime Minister Justin Trudeau said he was disappointed by the decision to turn down a cross-border permit for the Keystone XL pipeline, but he respected the right of the U.S. government to make it.

Prime Minister Justin Trudeau, seen during his first phone call with U.S. President Barack Obama last month, said he respected the decision.

“The Canada-U.S. relationship is much bigger than any one project, and I look forward to a fresh start with President Obama to strengthen our remarkable ties in a spirit of friendship and co-operation,” he said in a statement.

Trudeau’s Liberal party, which won the Canadian election last month, supported the 2,600-kilometre, $7-billion project to send up to 830,000 barrels of oil a day from Alberta’s oilsands to the U.S. Gulf Coast.

Trudeau’s comments mirrored Obama’s remarks at the White House Friday morning.

“We’ve both agreed that our close friendship on a whole range of issues, including energy and climate change, should provide the basis for even closer co-ordination between our countries going forward,” Obama told reporters.

In announcing his decision, the president said “shipping dirtier crude oil into our country would not increase America’s energy security.”

Alberta Premier Rachel Notley spoke to reporters after the U.S. president's decision.

Alberta Premier Rachel Notley said she was not surprised at the decision, but was disappointed by Obama’s description of the oilsands in her province.

“It was not necessary to be quite so critical in the way they described our energy product,” Notley told reporters. “The U.S. relies on our oil. They currently import already over 300-million barrels a day, and so I don’t think it is a particularly logical explanation for why they would reach this position.”

The premier from the center-left New Democratic Party stressed the need for “careful drama-free conversations” on energy infrastructure, but she also said Obama’s decision underlines the fact that Alberta needs to do a better of job of convincing the world of its genuine effort to combat climate change.

“The U.S. makes decisions on the basis of their internal domestic policies… but I do think that one thing that would have made this decision better was ensuring that our record was a better one.”

'Fait accompli'

The Conservative party — which was in power for nearly a decade under Stephen Harper until last month’s election — said it was extremely disappointed that Obama had “succumbed to domestic political pressure."

“It has been clear for some time that — despite the facts, economic benefits and environmental safeguards — the White House’s decision was a fait accompli,” interim party leader Rona Ambrose said in a press release.

"This project has proven to be good for the economy, the strengthening of energy security in North America, and for environmentally sustainable development. The rejection of Keystone will not stop Canadian oil exports to the United States. It simply means we will continue to rely on transportation alternatives like shipping and rail.”

TransCanada executive Russ Girling said 'rhetoric won out over reason' in the Keystone rejection. (Photo: Canadian Press)

TransCanada submitted its permit application to the State Department in 2008. In 2010, the Canadian National Energy Board approved the company’s bid to build and operate the Canadian portion of the project, saying it was in Canada’s public interest.

TransCanada’s president and chief executive officer Russ Girling said Friday that Obama’s decision dealt a damaging blow to thousands of jobs on both sides of the border. He noted several State Department studies suggesting that approval of Keystone XL would not significantly exacerbate greenhouse gas emissions and that pipelines are a safer mode of transportation than rail and road.

“Today, misplaced symbolism was chosen over merit and science. Rhetoric won out over reason,” he said in a statement.

TransCanada will review “all of its options,” including filing a new application for a presidential permit, Girling added. "TransCanada and its shippers remain absolutely committed to building this important energy infrastructure project.”

Minister of Foreign Affairs Stephane Dion speaks to the media in Ottawa on Friday. (Photo: Sean Kilpatrick/Canadian Press)

Canadian Foreign Affairs Minister Stéphane Dion, however, seemed to suggest during a press conference that the Canadian government would stop lobbying for the project.

Canada has been arguing that it needs get its product to tidewater and that a pipeline is a safer and more environmentally friendly method, Dion said.

“The U.S. decided otherwise, and now we need to move on,” he said. “We need to have a fresh start and to be sure that ... nobody will question the fact that Canada has a strong environmental assessment, strong science, strong clean energy deployment, strong clean infrastructure…. Then our products and goods will be welcomed everywhere.”

Obama’s decision was roundly praised by environmental groups in Canada, which applauded Obama for leading by example.

The Pembina Institute said it is proof that addressing their impact on climate is “the new normal” for major energy infrastructure projects, while the Environmental Defence group called it a lesson showing the need for Canada to rethink its “failed economic strategy,” which is focused heavily on exporting fossil fuels.

While Obama no doubt made some remarks unwelcome in Canada about the need to keep “some fossil fuels in the ground” to fight climate change, the president now has a much more ideologically similar partner in Trudeau than he did with Harper.

Former prime minister Stephen Harper, left, and his government lobbied for Keystone XL, while his successor, Justin Trudeau, right, said he looked forward to a fresh start with President Barack Obama. (Photo: Canadian Press)

The president mentioned Friday that senior members of his team would be meeting with the new prime minister’s advisers in the coming weeks.

Trudeau will also be choosing a new ambassador to the United States, which may also help reset the relationship.

For years, the Canada-U.S. relationship has been defined by the Keystone XL pipeline application. Harper’s Conservative government lobbied extensively in Washington, but the former prime minister’s defiant attitude, according to some, annoyed the Obama administration.

In an interview with Bloomberg in 2011, Harper called approving Keystone a “no-brainer” that made economic and environmental sense and he threatened to “seek out” other partners, such as China, for energy exports. The United States imports more oil from Canada than from any other country.

In 2013, Harper told a gathering of business leaders in New York that even if the White House denied the pipeline a permit, Keystone would be built. “My view is you don’t take no for an answer,” he said.

At the same time, however, the Conservatives did little to assuage the Obama administration’s concerns that the pipeline projects would increase carbon emissions. It also never moved on a 2007 promise to enact targets for reducing oil and gas emissions.

President Barack Obama pauses while making a statement on the Keystone pipeline on Nov. 6, 2015. (Photo: Susan Walsh/CP/AP)

Obama said Friday that it is an old way of thinking to believe protecting the environment comes at an economic cost. “As long as I’m president of the United States, America is going to hold ourselves to the same high standards to which we hold the rest of the world.”

He said he is looking forward to joining other world leaders at the UN climate change summit in Paris later this month to work on an ambitious framework to protect the “one planet that we’ve got, while we still can.”

During his first press conference as prime minister-designate, Trudeau said he also wanted to ensure that Canada demonstrated in Paris its commitment “to being a positive actor doing our share to reduce global emissions.”

With files from Kate Sheppard

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