Wednesday, August 08, 2012
Keystone XL Needed Now More than Ever
The American people understand the benefits of the Keystone XL Pipeline. Unfortunately, the Obama administration continues to play politics with this important energy project.
On the positive side, the southern portion of the pipeline project – running from Cushing, Oklahoma, to the Gulf of Mexico (now being called the Gulf Coast Project) – finally received its final permit to move ahead.
In a statement, Russ Girling, TransCanada's president and chief executive officer, said, “Receiving this final, key Army Corps permit for the Gulf Coast Project is very positive news. TransCanada is now poised to put approximately 4,000 Americans to work constructing the $2.3-billion pipeline that will be built in three distinct 'spreads' or sections. The Gulf Coast Project will contribute millions in property taxes to counties in Oklahoma and Texas, money that can be used to build roads, schools and hospitals.”
But the real news remains that TransCanada is still waiting on the Obama administration to make another decision on the 1,179-mile part of the pipeline project that would run from Hardisty, Alberta to Steele City, Nebraska. This would bring both Canadian and North Dakota crude oil to Gulf Coast refineries.
Recall that President Obama rejected the project in January, siding with green extremists who oppose all carbon-based energy and also happen to be part of the President’s political base. At the same time, so as to not alienate another part of his base, i.e., labor unions that support the project, the White House invited TransCanada to reapply for approval with a slightly altered path. TransCanada did reapply in May.
This project should be a no-brainer. Multiple years of review by the State Department gave a thumbs up on the environmental front. The project would generate significant jobs – as noted above by the TransCanada CEO. Estimates put the boost in U.S. employment from the 80,000 jobs supported by existing oil sands projects in 2010 to 179,000 jobs in 2035, with a potential for as many as 600,000 by 2035. For good measure, this means expanded oil for U.S. refineries, and an increase in oil supplies from reliable sources.
As noted by API Refining Manager Cindy Schild, “There is no reason to further delay this critical jobs and national security project. With high unemployment and continued instability in the Middle East – approval of this pipeline will help our economy and help put our energy future back into our own hands.”
In a statement, TransCanada added: “The pipeline will transport growing supplies of U.S. crude oil to meet refinery demand in Texas. Gulf Coast refineries will be able to access lower-cost domestic production and avoid paying a premium to foreign oil producers, reducing cost and the United States' dependence on foreign crude oil.”
The American people understand the potential benefits. A Washington Post poll released on July 1 asked if the U.S. government should approve the pipeline project. Among adults in general, 59% said yes and 18% no, and among registered voters, it was 62% in the yes column and, again, 18% no.
Small business owners, perhaps more so than anyone else, understand the need for affordable, reliable energy, as they struggle in a tough economy while figuring out how to wrestle with high and uncertain energy costs. In an April 2012 survey conducted by SBE Council, 72% of small business owners said high energy prices were impacting their firms – a shocking 43% said if gas prices remained high or shot higher the survivability of their business was at stake.
It’s time for the Obama White House to push aside the politics, and do something positive for the U.S. economy by approving the Keystone XL Pipeline project.
Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council. His new book is “Chuck” vs. the Business World: Business Tips on TV.