Keystone Pipeline Back on the Agenda

Keystone pipe construction

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Keystone Pipeline Back on the Agenda
| published November 15, 2014 |

By R. Alan Clanton
Thursday Review editor

The Keystone XL Oil Pipeline (aka, Keystone Pipeline) is back on the national agenda as the Republican-controlled U.S. House of Representatives passed new legislation authorizing the project to begin anew. The bill approved by the House will move next to the Senate, where—now controlled by a narrow majority of Democrats—the GOP will soon deploy its biggest majority in decades.

The new legislation passed 252 to 161. All Republicans present voted for the bill, and 31 Democrats joined those in the GOP in support of the massive pipeline project. The majority of Democrats opposed the bill.

The vote will surely trigger a confrontation with President Barack Obama, who is opposed to the Keystone Pipeline—at least as far as the current plans are drawn.

The pipeline project, significant parts of which have already been completed, was first proposed more than a decade ago. The pipeline would connect crude oil reserves in Canada with refineries and distribution facilities along the Gulf Coast and along the Mississippi River in Illinois. Plans for additional sections reached a critical development and planning stage at about the same time that the pipeline’s southernmost connection was completed near Cushing, Oklahoma several years ago, but its final blueprint was rejected by President Obama in January 2012. Citing high-profile concerns about the route of the pipeline through environmentally sensitive areas of the Plains States—such as the Sand Hills regions of Nebraska—Obama nixed several new legs of the pipeline’s expanded footprint.

Rewritten and reconfigured plans to reroute the pipeline through other areas of Nebraska and several adjacent states have met with additional resistance, both from the White House and from several court jurisdictions. Legal challenges have been brought to bear, both in favor of the pipeline and in opposition. As of a few months ago the 1179 mile-long project seemed destined to remain stalled.

But now, thanks to the odd circumstance of a highly-watched run-off election for a U.S. Senate seat in Louisiana, talk of the Keystone pipeline seems resurrected.

The current bill was introduced by Republican Senate candidate Bill Cassidy (currently a member of the U.S. House and now a candidate for Senate), and some Democrats are complaining that Cassidy’s bill is little more than a ploy to draw attention to his candidacy in the midst of what may be an extremely close runoff election with incumbent Senator Mary Landrieu. As a condition of her political survival, Landrieu is expected to also support the bill when it reaches the Senate, but in doing so she will be forced to break sharply with the President.

Cassidy and his allies in the House say that the bill is all about jobs and energy. Completion of the next phases of the pipeline project would entail the hiring of many thousands of workers for up to three years, and the project’s multiplier effect could boost the economy of some of the surrounding areas along the pipeline’s path for years to come. Other advocates of the project point first to the energy independence which would result from the pipeline’s completion. Though at the moment oil prices are relatively low (and expected to go even lower), supporters of the pipeline suggest that instability in the Middle East could easily trigger more price increases in the future, and stress that only through energy independence will the U.S. be free from the sort of worldwide regional market disruptions which can result from wars or natural disaster.

The President’s opposition to the pipeline, which developed slowly during his first term in office, is now stiffening. And though the White House is awaiting the outcome of the several legal challenges working their way through the courts, Obama and his spokespersons have recently indicated that environmental concerns will trump energy independence and jobs.

“I have to constantly push back,” the President said, “against this idea that somehow the Keystone Pipeline is a massive jobs bill for the United States, or is somehow lowering gas prices. Understand what this project is: it is providing the ability of Canada to pump their oil, send it through our land down to the Gulf, where it will be sold everywhere else.”

But many oil and energy analysts point out that the pipeline would still generate revenue for U.S. companies, and might in fact provide oil for U.S. demand. Also, some percentage of the oil being sent through the pipeline would originate in oil fields in the American upper plains states. Promoters of the project—which includes the tacit approval by the U.S. State Department—also point out that Canada will sell the oil whether the U.S. provides a conduit for its distribution or not, and several environmental studies have concluded that transporting the oil by truck across open highways in the U.S. and Canada will, in fact, generate more harm to the air and produce more carbon emissions than the pipeline. At its peak, the pipeline is expected to move between 800 and 900 thousand barrels of oil per day.

Republicans have used Obama’s veto of the project as an indication of the President’s unwillingness to encourage real energy independence for the U.S. The White House has countered that the GOP is too fixated on the continuation of fossil fuel economic models, and is unwilling to look for other sources of energy which may greatly reduce the U.S. carbon footprint and reduce greenhouse gases.

The bill is expected to reach the Senate by next week. Many political analysts think that those Democrats who support the pipeline may cast the decisive votes. Though Senator Landrieu was unclear on the White House position in regards to the court cases, she said she would likely support the measure to restart the project. But like many in the Senate, it is unlikely that supporters of the Keystone pipeline would be able to muster the two thirds votes necessary if the President kills this latest version of the project.

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Will Oil & Gas Trigger Flare-Ups in South China Sea?; Thursday Review; September 16, 2014.

Blame This Winter’s Cold on…The Heat; Thursday Review; September 16, 2014.