North American energy company TC Energy has signed a definitive agreement with indigenous led company Natural Law Energy (NLE).
Under the agreement, NLE will make an equity investment of up to C$1bn ($763.7m) in TC Energy’s controversial $8bn Keystone XL pipeline project.
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According to TC Energy, the agreement also covers the possibility of NLE seeking a stake in future Liquids projects.
The Keystone XL Pipeline is a new 1,897km-long crude oil pipeline being developed by TC Energy. The cross-border pipeline will run from Hardisty in Canada to Steele City, Nebraska and Texas in the US.
It has the capacity to deliver 830,000 barrels per day (bpd) of crude oil and is expected to reduce greenhouse gas emissions by 19 million metric tonnes.
NLE is a ‘Treaty alliance’ of five First Nations in Canada. Four are from Alberta and one from Saskatchewan.
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By GlobalDataKeystone XL Pipeline president Richard Prior said: “This agreement is a reflection of the meaningful way NLE is choosing to participate in a long-term partnership on the Keystone XL pipeline.
“This partnership will facilitate important input and guidance from NLE on the project as we make this the most sustainable and safest pipeline ever developed.”
TC Energy noted that the first phase of the deal with the indigenous group is expected to be completed in Q3-2021. It is, however, dependent on Natural Law Energy securing financing.
Natural Law Energy CEO Travis Meguinis said: “Today, we’re pleased to announce that NLE’s definitive agreement is one of the largest ever with over C$1bn deal for First Nations.”
The Keystone XL pipeline project has been delayed for over a decade as it received huge opposition from landowners, environmental groups and tribes.
Natural Law Energy executive director Brian Mountain said: “We are committed to value projects such as Keystone XL to ensure we are achieving multi-generational social and financial well-being of the Nations partnered with NLE. Our current relationship with TC Energy is a great example of what reconciliation looks like between our Indigenous communities and industry.”
Last month, TC Energy awarded more than $1.6bn worth of contracts to six major American union contractors to construct pipelines for Keystone XL Pipeline.
