Canadian Energy Company Sells Stock In KXL Pipeline To Indigenous Communities

After almost three years of negotiation, Canadian natural gas company TC Energy has sold a $1.1 billion Canadian dollar ($769 million U.S. dollar) stake in the Keystone XL (KXL) oil pipeline to a group of Indigenous First Nations. The share was bought by Natural Law Energy (NLE), a conglomerate of five Canadian First Nations: Nekaneet Cree First Nation, Erminsekin Cree Nation, Akahmik Montana Cree First Nation, Louis Bull Tribe, and Little Pine First Nation. The finalization of this sale kickstarts the largest Indigenous oil investment in history. It also marks an important shift from native groups receiving small, consolation type payments to a more substantial limited ownership of the pipeline.

The KXL pipeline proposed in 2008 has been met with resistance since the beginning, delaying its construction. One of its biggest controversies which this deal works to combat is that the pipeline would run through large amounts of native land, both in the U.S. and Canada. Brian Mountain, director of NLE, said that this agreement would provide tribes with “intergenerational wealth” by funding education efforts or business ventures. In some ways, this is a step forward for recognition and meaningful participation of Indigenous peoples; the partnership follows other similar efforts such as moving away from Columbus Day to Indigenous Peoples Day or the renaming of various mountains to honour native figures rather than white colonizers. While TC Energy hopes that NLE participation will minimize some of KXL’s backlash, there are other issues threatening its success.

One major complaint is the pipeline’s environmental impact. The KXL pipeline plans to ship 830,000 barrels of oil each day over 1,210 miles. Natural gas pipelines are responsible for about ten per cent of methane emissions from the fossil fuel sector, making them a crucial target. In addition to concerns about oil spills and general pollution, many worry about the impact of tar sand which would run through the pipeline. According to the University of Auburn, tar sand is composed of sand, petroleum, mineral salts, and added toxic chemicals, constituting a mix that emits 17 per cent more greenhouse gases than typical crude oil. Joe Biden also expressed this concern in a CNBC interview, saying “It is tar sands that we don’t need [and] that in fact is a very, very high pollutant.” Other environmental impacts include toxic clouds and emissions which could result in dangerous illnesses, and potential water pollution if the gas sinks into nearby groundwater. Despite the positives for native people, many still believe that the pipeline is too great a risk given the current climate crisis. Steve Volker who works for an Indigenous American environmental group still opposes the pipeline, believing that “destroying the planet to make money is unconscionable, no matter who is making the money.” TC Energy has responded to these accusations by creating a green training fund.

The other important consideration of the pipeline is its economic impact. Construction on the pipeline has already begun despite lawsuits and lack of approval, employing about 3,000 workers. With plans to increase construction in 2021, KXL forces expect to hire about 12,000 additional workers and has signed agreements with labor unions. Under Trump’s endorsement, TC Energy has said that the fully operational pipeline will “inject 8 billion into the North American economy,” according to Al Jazeera; 1.6 billion dollars has already been promised to U.S. union contractors alone. In the wake of devastating coronavirus shutdowns, the pipeline could offer promising economic prospects for recovery.

While this unprecedented Indigenous involvement seems exciting, there is potential that native groups are simply being used as a tool to get the pipeline approved. Part of KXL’s delays are due to President Obama’s lack of endorsement, a move quickly reversed by President Trump’s executive order in 2017 and subsequent presidential order in 2019. Now, TC Energy faces another pause if they cannot gain Joe Biden’s support, with financing expected to finalize in next year’s third quarter. Joe Biden promised in his campaign run that he would revoke the KXL permit. TC, however, believes that the pipeline fits into Biden’s Build Back Better Plan. In an interview with ABC, a TC executive stated that “the steps that [they’ve] already taken with Keystone XL have positioned it very favourably,” likely referencing the Indigenous deal as one of these steps. This also spurs a fear of Indigenous exploitation by the oil company, with NLE required to invest in and contribute to the pipeline every year in return for its stake.

On the other hand, if this deal is truly equitable, Biden’s authorization could create significant benefits for North American Indigenous populations. Nekaneet First Nation Chief Alvin Francis is hopeful for the pipeline’s success and its impact on his people and says, “If I could meet Joe Biden I’d say, ‘This a chance for you to change my First Nation’s view of the world.’”

Sydney Stewart