TC Energy Corp. says it has suspended work on the Keystone XL project in anticipation of U.S. president-elect Joe Biden revoking its vital presidential permit once he is sworn in later today.
In a news release, it says it is “disappointed” with Biden’s expected action, adding it will overturn extensive regulatory reviews that found the pipeline would transport needed energy in an environmentally responsible way and bolster North American energy security.
It warned the move will lead to the layoffs of thousands of union workers and comes despite its commitments to use more renewable energy and draft partnerships with Indigenous communities.
TC Energy says it will stop capitalizing costs, including interest during construction, effective Wednesday, and will evaluate the carrying value of its investment in the pipeline, net of project recoveries.
It says this will likely result in “substantive” mostly non-cash writedowns in its first-quarter financial results.
On Tuesday, Alberta Premier Jason Kenney urged Prime Minister Justin Trudeau in a phone conversation to press Biden to allow Keystone XL to proceed. Kenney’s government has invested $1.5 billion directly in the project, along with loan guarantees, and he has said about $1 billion is at risk if the project is killed.
“Our base business continues to perform very well and, aside from Keystone XL, we are advancing $25 billion of secured capital projects along with a robust portfolio of other similarly high-quality opportunities under development,” TC Energy CEO Francois Poirier said in a statement.
He says the company remains committed to growing earnings and dividends through its investments in critical energy infrastructure even if Keystone XL doesn’t go ahead.