Research Briefing

By Rejecting Keystone, Obama Makes Clear His Job Is More Important Than Creating Jobs

The Obama Administration Will Announce This Afternoon That It Will Reject TransCanada’s Permit Application To Build The Keystone Pipeline. “The Obama administration will reject the Keystone XL pipeline Wednesday afternoon, according to a source closely following the issue. The State Department is expected to make an announcement at 3 p.m. Wednesday afternoon. While the administration is expected to reject TransCanada Corp.’s permit application, it will allow the company to reapply, according to the source. The White House has long signaled that the administration is unlikely to approve the Alberta-to-Texas pipeline under the timeline required in December’s payroll tax cut extension law, which mandates a decision by Feb. 21.” (Ben German and Andrew Restuccia, “White House Will Reject Keystone Pipeline,” The Hill’s E2 Wire , 1/18/12)

THE KEYSTONE PIPELINE WOULD CREATE JOBS AND GROW THE ECONOMY IN THE U.S.

The Keystone Pipeline Was Expected To Result In As Many As 130,000 Jobs. “Many of those 20,000 jobs on the construction of the pipeline would have been filled by skilled union members. Eventually, the completed pipeline was expected to result in as many as 130,000 jobs, many of them on the upper Texas Coast, where the heavy oil would be refined into 700,000 barrels of oil daily.” (Editorial, “Keystone Pipeline Delay Is The Wrong Call,” Houston Chronicle, 11/11/11)

The Pipeline Would “Produce 20,000 Construction Jobs And 100,000 Indirect Jobs.”  “Gary Doer, the Canadian ambassador to the United States, said building the pipeline would produce 20,000 construction jobs and 100,000 additional indirect jobs in services and supplies. ‘It’s good for the U.S. economy, U.S. jobs and U.S. energy security,’ he said. ‘If you ask Americans, would you choose Canada over the Middle East, they’d say yes.’” (John M. Broder & Clifford Krauss, “U.S. Offers Key Support To Canadian Pipeline,” The New York Times, 8/26/11)

• The Keystone Pipeline Will Create 20,000 Jobs. “TransCanada’s initial estimate of 20,000 - which it said includes 13,000 direct construction jobs and 7,000 jobs among supply manufacturers - has been widely quoted by lawmakers and presidential candidates.” (Juliet Eilperin and Steven Mufson, “Keystone Pipeline Battle Heating Up,” The Washington Post, 11/6/11)
• Four Labor Unions Reached A Tentative Agreement To Build The Pipeline Because They Say It Will Directly Create As Many As 20,000 High Wage Jobs For Their Members. “In September 2010, four unions - the United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada; the Laborers International Union of North America; the Teamsters; and the International Union of Operating Engineers - reached a tentative project labor agreement with TransCanada to build the pipeline, which is now finalized. They say the project will directly generate as many as 20,000 high-wage jobs for their members.” (Juliet Eilperin and Steven Mufson, “Obama’s Allies’ Interests Collide Over Keystone Pipeline,” The Washington Post, 10/16/11)

• The Pipeline Has Support From Four Unions.  “The oil industry, 14 U.S. senators and four unions representing 2.6 million workers have pushed for swift approval of the pipeline, which they said would help keep energy costs down, stimulate $20 billion in spending for the U.S. economy and spur creation of 118,000 jobs.” (David Lerman & Jim Efstathiou Jr., “TransCanada Pipeline’s Environment Risk Limited, U.S. Finds,” Bloomberg, 8/26/11)

The Washington Post: Rejecting The Keystone Pipeline “Would Help China Lock Up More Of The World’s Oil Production” And “Cost Infrastructure Jobs” In The U.S. “But it would help China lock up more of the world’s oil production, cost infrastructure jobs in the United States and offend a reliable ally. More delay after three years of review is insult enough.” (Editorial, “Washington’s Unwelcome Delay In The Keystone XL Pipeline Project” The Washington Post, 11/12/11)

• “The Oil From Canada Could Ultimately Supplant Much Of The Oil The United States Imports From The Middle East And Other Unstable Regions. It Could Give The Country A Measure Of Energy Security.” (Editorial, “Pipeline Delay An Insult To Jobless,” The Detroit News, 11/14/11)

OBAMA’S DELAY MAY LEAD TO THE COMPANY SEEKING DIFFERENT EXPORT MARKETS, SUCH AS CHINA

Canadian Prime Minister Stephen Harper Has “Racheted Up” Support For Transporting Its Oil Westward To Send To Asia Due To The Keystone Pipeline Being “Tripped Up By Politics In Washington.” “The first of more than a year's worth of public hearings over a proposed pipeline designed to ship crude from Canada's landlocked oil-sands to the Pacific begins Tuesday, threatening to fan a debate in Canada over the country’s growing status as a global energy powerhouse. Prime Minister Stephen Harper recently ratcheted up support for the idea of transporting some of Canada's growing oil production westward to the coast, where it can be loaded onto tankers and sent to thirsty Asian markets. The new push comes after another proposed pipeline, TransCanada Corp.'s Keystone XL, was tripped up by politics in Washington.” (Edward Welsch, “Canada Pipeline Hearings Near,” The Wall Street Journal, 1/9/12)

 “Harper Has Said The Decision Underscores The Needs To Find New Buyers For Canada’s Energy.” (Theophilos Argitis and Andrew Mayeda, “Securing Border Sets Obama-Harper Plan For Faster Trade, Travel,” Bloomberg, 12/6/11)

• Prime Minister Harper: “It Is Not In This Country’s Interests That We Are A Captive Supplier Of The United States Of Energy Products, Especially When We See Some Of The Politics That Are Going On South Of The Border.” (Theophilos Argitis and Andrew Mayeda, “Securing Border Sets Obama-Harper Plan For Faster Trade, Travel,” Businessweek, 12/6/11)

Alberta’s Top Official Said Obama’s Decision To Delay The Keystone Pipeline May Lead The Company To Seek Different Export Markets. “Alberta’s top official said this evening that the White House’s surprise opposition to the Keystone XL pipeline pressures the province to seek different export routes for its valuable oil. ‘Alberta is an export-based economy and today’s decision is a clear reminder about the strategic importance of diversifying our export markets,’ said Alison Redford, the new right-of-center premier of Canada’s Alberta province.” (Neil Munro, “Alberta Premier Upset By Obama’s Keystone XL Decision,” The Daily Caller, 11/10/11)

• “Her Statements Suggest Officials Will Work To Build Alternative Pipelines To Canada’s East Or West Coast, Bypassing The United States, 20,000 Construction Workers And Many Oil-Sector Workers.” (Neil Munro, “Alberta Premier Upset By Obama’s Keystone XL Decision,” The Daily Caller, 11/10/11)
  
• Top Alberta Official Alison Redford: “I sincerely hope that the State Department made this decision based on science and evidence and not rhetoric and hyperbole from very well-organized interest group.” (Neil Munro, “Alberta Premier Upset By Obama’s Keystone XL Decision,” The Daily Caller, 11/10/11)

If Administration Doesn’t Approve The Pipeline, Canada May Find Another Country Such As China. “Canadians in the oil industry and government are often heard delivering a subtle but unmistakable message to their American friends: If you don’t welcome the fuel that this pipeline would deliver, we will find someone else who does.” (Elana Schor, “Keystone XL Tests U.S.-Canada Energy Ties As Asian Suitors Loom,” The New York Times, 9/13/11)