What Will Happen Next to the Keystone Pipeline?


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President Barack Obama vetoed the Keystone Pipeline on February 24, as promised. “The presidential power to veto legislation is one I take seriously,” Obama said in his veto message to the Senate. “But I also take seriously my responsibility to the American people. And because this act of Congress conflicts with established executive branch procedures and cuts short thorough consideration of issues that could bear on our national interest — including our security, safety, and environment — it has earned my veto.” It is only the third veto of his presidency. And on March 4, the Senate failed to capture the two-thirds needed to override the presidential veto, with only 62 lawmakers casting a ballot in support.

It has been more than 2,300 days since the application to build the Keystone XL Pipeline was submitted to the U.S. Department of State, according to House Majority Leader Kevin McCarthy of California. This project has served as a proxy in the broader fight between congressional Republicans and the White House over climate change. After the Keystone XL Pipeline bill was defeated in a Senate vote in mid-November, the Republican leadership promised the new 114th Congress would promptly reignite the battle over the oil pipeline. Since then a measure approving the pipeline project was passed by both house of Congress before dying on Obama’s desk.

At the end of January, the Senate voted 62 to 36 in favor of building the pipeline, with nine Democrats joining 53 Republicans in passing the legislation. On February 11, the measure passed the House by a vote of 270 to 152. But neither chamber appears to have the two-thirds majority needed to overturn Obama’s veto. In a statement released after the House vote, McCarthy expressed his dissatisfaction with the president’s continued opposition to the pipeline. “The people want Keystone, and today the House is sending a bipartisan bill that approves Keystone to the President’s desk,” he said. “President Obama can’t hide behind delays and reviews anymore. It’s time for him to make a decision.”

Still, another obstacle in the construction of the pipeline cleared away when the Nebraska Supreme Court decided at the end of January that Republican Governor Dave Heinema has the authority to approve the $5.3-billion project’s route without a review by the state’s Public Service Commission. The proposed pipeline would transport oil from Alberta Canada to Steele City, Neb, where the southern leg of the route begins. Also on Friday, the House of Representatives — where the Republicans have the largest majority since the Great Depression — passed a bill authorizing the Keystone XL oil pipeline, with a strong margin of 266 to 152. Twenty-eight Democrats lent their support.

TransCanada’s 1,179-mile oil pipeline, which would carry 830,000 barrels of crude per day from the tar sands of western Canada to Gulf Coast oil refineries, claims bipartisan support both in Congress and with the American public. When the company first submitted its application to the State Department in 2008, the Obama administration saw the project as a routine infrastructure project. However, environmental groups brought the issue into the public spotlight, and the project slowly became the Obama administration’s leading climate change fight. Robert N. Stavins, director of Harvard’s environmental economics program, believes the debate is not over facts but politics. “The political fight about Keystone is vastly greater than the economic, environmental or energy impact of the pipeline itself,” he told The New York Times. As activist Bill McKibben told the publication, vetoing the Keystone legislation would have huge symbolic importance. “If the president blocks Keystone XL, he becomes the first world leader to say, ‘Here’s a project we’re not doing because of its effect on the climate.’ ”

Speaking on the House floor, McCarthy ticked off all the reasons why Obama should not veto the legislation: it creates jobs, has little impact on climate change, and will help make the United States energy independent. When defending his intention to veto the bill authorizing the pipeline’s construction, Obama cited environmental concerns, and the unresolved legal dispute in Nebraska. For the Majority Leader and other leading Republicans like Murkowski, the resolution of the controversy over the planned route eliminates Obama’s last excuse not to sign the Keystone bill; Obama has said on multiple occasions that he cannot make a decision on the project until the State Department officially finishes its environmental review, which was held up by the Nebraska court case. The president’s environmental concerns — namely, the destruction of forests and carbon pollution — have no basis in fact, according to Republicans, who cite a 2013 State Department review of the project. That analysis concluded that building the pipeline would not significantly increase the rate of carbon pollution because the oil would make it to market with or without Keystone. With Keystone, the American job market will benefit, Republicans say. But while supporters of the Keystone pipeline, including McCarthy in his Friday speech, claim the project will create 42,000 jobs for Americans, the administration (and research) say otherwise.

“As we have made clear, we are going to let that process play out,” spokesman Eric Schultz said in a statement. “Regardless of the Nebraska ruling today, the House bill still conflicts with longstanding Executive branch procedures regarding the authority of the president and prevents the thorough consideration of complex issues that could bear on U.S. national interests, and if presented to the president, he will veto the bill.”

As these votes make clear, Republicans are far from giving up the Keystone Pipeline. New Jersey’s Republican Governor Chris Christie, a 2016 presidential hopeful, has succinctly summarized one reason why Republicans want the Keystone pipeline to be built; it would be “to the advantage of every citizen of Canada and the United States” and “another foundational piece or strengthening the geopolitical position of North America,” he argued back in November, according NJ.com.

However, the average American doesn’t know the first thing about the oil transport business or even how the Keystone XL pipeline would change it. And indeed, the history of Keystone and the history of Keystone XL are two separate topics — connected, but over a long and arduous approval and protest process up through present day and this latest segment of pipeline. The topic of jobs, similarly, is more complex than a simple blanket statement that it will improve the economy and create new jobs. This is true, of course, but the amount of jobs and the permanence of those jobs are topics of much debate, especially given the environmentally volatile nature of the Pipeline and President Barack Obama’s reservations. If the jobs are only short-term positions, does the job creation argument used by so many representatives lose some of its steam?

A report from the United States Department of State outlined just how the jobs would probably break down for the XL segment of the Keystone Pipeline, stating that 42,000 jobs would be created. Of those, 3,900 would be in construction and 26,000 would be in the area of goods and services. After the pipeline is finished, only 35 employees would be needed as well as 15 temporary contractors. Those numbers may be far from inspiring at the end of the construction period, but many pipeline proponents would argue that short-term jobs are still jobs, and that a great many of the jobs created today are short-term positions, so that perspective may not be entirely fair. Having said that, sustainable job growth — and the subsequent economic health that results — is certainly a more attractive and ultimately more convincing sales pitch, you have to admit.

One aspect many neglect to consider when they look at potential job growth is the current system in place for transporting oil and natural gas. According to Brookings, the Keystone XL pipeline as currently proposed would only add less than 0.8% of the 150,000 miles of already present oil transportation structure — as shown in the map below by the yellow line.


Keystone XL is, in that way, a drop in the bucket. The XL pipeline actually wouldn’t be able to keep up with anything over 830,000 barrels of oil per day — which many shale reserves are able to produce at this point (and overproduce), meaning demands wouldn’t even be fully met. Nor would it handle a number of transportation needs from U.S. areas of production and refinery because the majority of movement is coming from Canada across the U.S. Brookings notes that these needs are currently, and likely will continue to be, met by railways and other forms of transport.

Domestic crude oil is also dependent on trucks, barges, and tankers, and while pipelines can carry more oil far faster, the growing transportation needs mean that these other transportation options are becoming more and more vital — and as Brookings points out “many U.S. shale reserves are found near metro areas still muddling through the economic recovery,” and some of these places “benefit from nearby oil to recharge their industries and create new jobs, regardless of the KXL.” In other words, the pipeline has its advantages in terms of efficiency, but there’s a lot of different ways to fry an egg when it comes to supporting the economy and creating jobs. It doesn’t negate the argument for the pipeline, but it does flesh out the complexities of the argument somewhat.

Also worth keeping in mind is that President Obama is just one among a number of approval problems the pipeline could face. There’s also the issue of whether or not the governor of Nebraska can approve the pipeline, or if it’s up to the Public Service Commission. Basically, whether the pipeline gets built or not, the transition won’t be smooth, the jobs created won’t be enough, and the carry capacity won’t satisfy all possible needs (which may even be a good thing given the other avenues for job creation transportation could open).

Follow Anthea Mitchell on Twitter @AntheaWSCS

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