Canadian Indigenous Group to Invest Up to C$1 billion in Keystone Oil Pipeline
Pipeline operator TC Energy TRP.TO said on Tuesday that Canadian indigenous group Natural Law Energy will invest up to C$1 billion ($763.77 million) in its Keystone XL oil pipeline, despite U.S. President-elect Joe Biden’s promise to stop the project.
Keystone XL (KXL) would carry 830,000 barrels per day of crude from Alberta to the U.S. Midwest. It has faced a decade of opposition from U.S. landowners, environmental groups and tribes.
Some indigenous groups oppose pipeline projects, but other Canadian First Nations have invested in the industry to share in profits and jobs.
The investment by Natural Law Energy, a coalition of five First Nations, comes with KXL construction well underway in Canada.
Opposition remains in the United States, where Biden has vowed to scrap KXL’s permit and where TC has largely halted construction.
“It sends a strong message to the U.S. government that this is not a project that indigenous people uniformly oppose,” said Ken Coates, public policy professor at University of Saskatchewan.
The investment provides Natural Law with a percentage of KXL’s profits, said NLE Chief Executive Travis Meguinis. He said raising the financing will not be a problem, and that he is confident KXL will proceed.
“There’s risk in any type of business,” he said.
KXL fits Biden’s plan to rebuild the economy, said Executive Vice-President, Liquids, Bevin Wirzba, at TC’s investor day.
Terms of the Natural Law deal are confidential, Wirzba said.
“I see it as a divide-and-conquer tactic,” said Matthew Campbell, staff attorney at Native American Rights Fund, which represents two communities in a lawsuit against the U.S. government and TC.
KXL’s part-indigenous ownership will not soften opposition, Campbell said.
The transaction’s first phase will close in the third quarter of 2021, contingent on financing, which mitigates the First Nations’ risk of Biden killing KXL, Coates said.
TC expects KXL to enter service in 2023.