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What Factors Should Drive Keystone Pipeline Decision?

By Amy Harder
energy and environment reporter, National Journal
October 11, 2011 | 6:00 a.m.
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What environmental, economic, and political factors should the Obama administration consider as it decides whether to approve a controversial pipeline project that would transport Canadian crude oil to the United States?

The State Department has said it will decide by the end of this year whether the 1,700-mile, $7 billion Keystone XL pipeline project is in the national interest. If it moves forward, it could eventually bring 700,000 barrels of tar-sands oil daily from Canada to Texas.

In recent weeks, the State Department held a series of public hearings on the project in states where the pipeline would cross and finally in Washington, D.C., to help evaluate whether the pipeline is in the country's interest. Some Congressional Democrats and environmental groups say recently released e-mails suggest an overly friendly relationship between a key State Department official and a lobbyist for TransCanada, the company seeking to build the pipeline. Critics say the e-mails cast doubt on the State Department's neutrality.

How should the administration address concerns about the environmental impact of producing oil sands? Will the pipeline be an economic boom, as industry groups supporting the project predict? If the United States doesn't import Canada's oil sands, will it make a difference, environmentally, since China and other countries may take the oil? What are the political implications for President Obama? And how have things changed since we last asked this question in May and in August 2010?

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October 14, 2011 4:23 PM

Keystone XL Is Wrong for the U.S.

By Michael Brune

Executive Director, Sierra Club

The Keystone XL pipeline is a bad idea for many reasons, but the Obama administration needs to consider only one factor to reach the right decision: Is it in our national interest? The answer is an unequivocal "no." Keystone XL would not only move us away from our national goals of energy independence and reversing climate disruption, it would also directly threaten the health and welfare of the American people -- all for the sake of oil industry profits.

Keystone XL is not in our interest economically and would hurt American consumers. TransCanada's claim that the pipeline would stabilize oil prices in the U.S. is simply not true. In fact, the likely motivation behind the project is the opportunity to alleviate what the industry sees as refining over-capacity in the Midwest. Pumping tar sands to the Gulf of Mexico would allow TransCanada and its partners to raise oil prices in the Midwest to collect $4 billion more from American consumers at ...

The Keystone XL pipeline is a bad idea for many reasons, but the Obama administration needs to consider only one factor to reach the right decision: Is it in our national interest? The answer is an unequivocal "no." Keystone XL would not only move us away from our national goals of energy independence and reversing climate disruption, it would also directly threaten the health and welfare of the American people -- all for the sake of oil industry profits.

Keystone XL is not in our interest economically and would hurt American consumers. TransCanada's claim that the pipeline would stabilize oil prices in the U.S. is simply not true. In fact, the likely motivation behind the project is the opportunity to alleviate what the industry sees as refining over-capacity in the Midwest. Pumping tar sands to the Gulf of Mexico would allow TransCanada and its partners to raise oil prices in the Midwest to collect $4 billion more from American consumers at the pump.

With U.S. oil consumption down and growing vehicle fuel-efficiency, Keystone XL makes little sense for supplying U.S. oil markets. Valero, one of six oil companies that would use Keystone XL (five of the six are foreign corporations), has made it clear that its main focus is the growing diesel markets in China and Europe. Port Arthur, Keystone XL's terminus, is a Foreign Trade Zone, potentially allowing foreign oil companies to avoid U.S. taxes on oil that is imported from Canada, refined in Port Arthur and exported to China and Europe.

Keystone XL move us away from our goal of ending dependence on oil. The pipeline would divert investment from the alternative-energy technologies that will power the clean economy, which has already generated 2.7 million jobs in the U.S. and has the potential to generate many more.

Keystone XL hurts American farmers and ranchers. TransCanada, through a questionable claim of eminent domain, will seize their land. And the first thing destroyed in a spill on Keystone XL will be the livelihood of farmers and ranchers who for generations have relied on clean water, unspoiled land, and hard work to raise much of America's livestock and put food on our tables.

Tar-sands oil is more dangerous to pump and spills are inevitable. TransCanada's existing Keystone pipelines are designed for conventional crude oil. But the unrefined bitumen oil that Keystone XL will carry is a much thicker, heavier substance than conventional crude oil. Sand in the mixture scours the inside of a pipe and the highly acid concentration, sulfur and other highly reactive chemicals will corrode steel pipes. This is especially problematic because tar sands oil must be pumped at much higher temperature (up to 158 degrees F) and higher pressure than conventional oil.

TransCanada estimated that its Keystone 1 would experience a spill once every seven years. In its first year of operation that pipeline spilled more than 12 times, including a 21,000 gallon spill in North Dakota in May 2011 that formed a 60-foot geyser of oil. TransCanada claimed that its automatic leak detection system would shut down pumps in 11.5 minutes. In that case, it took the pipeline operator 45 minutes to identify and shut down that pipeline.

In testimony before the House Subcommittee on Energy and Power, Committee on Energy and Commerce, Cynthia L. Quarterman, administrator of the DOT Pipeline and Hazardous Materials Safety Administration, said that U.S. pipeline regulations were not designed to ensure the safe pumping of highly corrosive raw tar sands crude under high pressure and temperature. The State Department, however, never consulted with the federal pipeline safety agency, which has never specifically studied the issue and which was excluded from involvement in the environmental review for Keystone XL.

In spite of the high risks involved, the Department of State and TransCanada have blocked any attempt to consider alternative routes for the pipeline that would avoid the Ogallala Aquifer, the Sand Hills of Nebraska, and other high-value natural areas (such as wetlands) or resources (such as drinking water).

Keystone's XL's tar-sands oil is environmentally indefensible. It takes two tons of soil to create one barrel of tar sands oil, and that soil must be strip-mined from Canada's massive natural boreal forest. Worldwide, deforestation is an even larger contributor to global greenhouse gas pollution then oil, and the area being stripped in Canada is one of North America's largest most important "carbon sink forests.

Extracting, refining, and burning a barrel of tar sands oil emits up to three times as much greenhouse gas pollution as conventional oil. The Alberta tar sands are the world's third biggest known reserve of hydrocarbons. They can be processed into crude oil only at enormous environmental expense.

In short, the U.S. gets higher gas prices, more air pollution, and the increased threat of catastrophic spills, but gains few, if any, jobs and none of the huge profits that the oil companies would reap. In our national interest? Only if we live in the United States of Oil.

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October 12, 2011 4:47 PM

Jobs, Security Should Drive Decision

By Jack Gerard

President and CEO, American Petroleum Institute

Good paying jobs. Economic growth. Energy security. Most Americans wouldn’t question whether these benefits are in the national interest. This is what the Keystone XL pipeline promises for America, and hopefully, this is what the State Department has learned about the project from its three-year review.

This important project will provide dependable access to supplies of North American oil while creating thousands of American jobs and enhancing our long-term energy security. Now it is time to recognize that obtaining energy from our friendly and reliable North American neighbor is surely in the best interest of all Americans.

Organized labor showed strong support for the project during the latest round of public hearings. They know that the project will result in immediate and significant job creation, as the project would create at least 20,000 jobs, mainly in construction and manufacturing. These are good-paying American jobs, the kind of shovel-ready jobs we so desperately need.

Right now at least 2,400 American companies in 49 states support develo...

Good paying jobs. Economic growth. Energy security. Most Americans wouldn’t question whether these benefits are in the national interest. This is what the Keystone XL pipeline promises for America, and hopefully, this is what the State Department has learned about the project from its three-year review.

This important project will provide dependable access to supplies of North American oil while creating thousands of American jobs and enhancing our long-term energy security. Now it is time to recognize that obtaining energy from our friendly and reliable North American neighbor is surely in the best interest of all Americans.

Organized labor showed strong support for the project during the latest round of public hearings. They know that the project will result in immediate and significant job creation, as the project would create at least 20,000 jobs, mainly in construction and manufacturing. These are good-paying American jobs, the kind of shovel-ready jobs we so desperately need.

Right now at least 2,400 American companies in 49 states support development of Canada’s oil sands either by providing the supplies and services in Canada or to expand our pipeline and refinery system here in the US. That’s 80,000 American jobs today, but if we approve the Keystone XL pipeline and fully utilize Canada’s energy resource we could see that number reach 500,000 by 2035. During that same time, the pipeline would spur $775 billion in economic activity.

But job creation – while absolutely critical – is only one of the benefits from the project. Strengthening our existing energy partnership with Canada will also enhance the security of our energy needs. With this pipeline our crude imports from Canada could reach 4 million barrels per day by 2020 – twice what we currently import from the Persian Gulf.

The pipeline will also provide another outlet for increased domestic production in the upper Midwest to reach refineries. This contributes to a larger, more dynamic pipeline system that will benefit consumers.

Keystone XL will be a safe, practical way to move a critical energy resource with minimal environmental impact. The State Department has already issued a positive environmental assessment. And the good news is the Canadian crude delivered by this pipeline is similar to crude from California, Venezuela and Mexico already being processed here in some of the most advanced refineries in the world. If we do not import the Canadian crude here, it’s almost a sure bet it will be sent to China, which due to shipping and inefficient refiners, will be much worse for emissions and for the environment.

The State Department has reviewed this project for more than three years in an extraordinarily thorough assessment that involved multiple federal, state and local agencies, as well as considerable opportunity for individual input. The benefits are clear, especially to those anxious for work. We shouldn’t make them wait any longer. It’s time for the administration to approve this project.

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October 11, 2011 7:45 PM

A National Security and Climate Threat

By Frances Beinecke

President, Natural Resources Defense Council

The Keystone XL pipeline poses too many environmental and national security threats to be in America’s interest. The Obama Administration should reject this project before it takes America down a dangerous path.

First and foremost, this pipeline is a climate threat. Producing tar sands oil generates three times as much carbon pollution as conventional crude. That’s even before we start burning it in our cars and trucks. We should be ending our oil addiction, not prolonging it with a dirtier fuel. If this pipeline proceeds, there is no way the United States can meet our carbon reduction goals if it proceeds.

Meanwhile, communities across the country are struggling to recover from extreme weather events—from drought and wildfires in the Southwest to punishing storms along the Atlantic Coast. People have lost their homes and city budgets have exhausted their ability to fund the clean up. If we encourage more tar sands oil development, we will be fueling—rather than reducing—the climate disruptions causing t...

The Keystone XL pipeline poses too many environmental and national security threats to be in America’s interest. The Obama Administration should reject this project before it takes America down a dangerous path.

First and foremost, this pipeline is a climate threat. Producing tar sands oil generates three times as much carbon pollution as conventional crude. That’s even before we start burning it in our cars and trucks. We should be ending our oil addiction, not prolonging it with a dirtier fuel. If this pipeline proceeds, there is no way the United States can meet our carbon reduction goals if it proceeds.

Meanwhile, communities across the country are struggling to recover from extreme weather events—from drought and wildfires in the Southwest to punishing storms along the Atlantic Coast. People have lost their homes and city budgets have exhausted their ability to fund the clean up. If we encourage more tar sands oil development, we will be fueling—rather than reducing—the climate disruptions causing these devastating weather events.

We will also be compromising American security interests. The Pentagon, the CIA, and the National Intelligence Council have identified climate change as a threat multiplier. And even if tar sands oil comes from a friendlier nation, our dependence on fossil fuel remains an Achilles heel. According to a recent Washington Post article, for every 50 convoys of fuel brought into Afghanistan, one Marine is wounded or killed. And for every one-dollar rise in the cost of oil, another $30 million gets added to the Navy’s energy costs.

That’s why the DOD has pledged to get 25 percent of its energy from renewable sources by 2025. The Navy and the Marine Corps plan to reduce fossil energy use by 50 percent by 2020 and cut the petroleum used in their non-tactical fleet by 50 percent by 2015.

The Keystone pipeline would take America in the opposite direction.

It would also endanger communities and precious resources: Carrying this dirty fuel across six states and the Ogallala Aquifer—the source for fresh water for the American Heartland—is inviting disaster. Last summer, a pipeline carrying tar sands oil ruptured in Michigan, contaminating the Kalamazoo River with heavy bitumen that sank to the bottom of the river where it has failed to biodegrade. The EPA says cleaning up the Kalamazoo could take years.

The American people do not risk more disasters when cleaner solutions exist. This summer President Obama announced new fuel efficiency standards that will reduce our oil use by 3.1 million barrels a day by 2030 and cut automobile carbon emissions in half. They will also save Americans $80 billion a year at the pump.

Tar sands oil cannot match any of those achievements. Instead, it locks America into more carbon pollution and increased risk of oil spills. This does not fit in the clean energy future President Obama is trying to build. We hope the President listens to the many people who have risked arrest in order to send him a message: the Keystone XL pipeline is not in America’s national interest.

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October 11, 2011 6:33 PM

“Green” Red Herrings in Pipeline Debate

By Brigham McCown

Principal and Managing Director of United Transportation Advisors LLC

Recent attention drawn to email exchanges between the Obama-Biden administration and TransCanada representatives by anti-development activists represents nothing more than a red herring in the Keystone XL Pipeline debate. In fact, this kind of sleight of hand is nothing new—it seems to be a core strategy of opposition activists, who have already made several attempts to derail the project by distorting the facts.

For example, while protestors point to Keystone XL’s proposed crossing of the Ogallala aquifer as good cause to reject the pipeline, they neglect to mention there are over thousands of miles of pipeline already crossing the aquifer (Nebraska’s major source of irrigation and drinking water) as illustrated by the map below. Yet, little state or national attention was directed to the planning and construction of these oil and gas pipelines. Why? Because decades of experience and review demonstrate that the risk to the environment from our 2.1 million miles of pipelines is minimal. So why is so much attention being given to a state-of-the-art pipel...

Recent attention drawn to email exchanges between the Obama-Biden administration and TransCanada representatives by anti-development activists represents nothing more than a red herring in the Keystone XL Pipeline debate. In fact, this kind of sleight of hand is nothing new—it seems to be a core strategy of opposition activists, who have already made several attempts to derail the project by distorting the facts.

For example, while protestors point to Keystone XL’s proposed crossing of the Ogallala aquifer as good cause to reject the pipeline, they neglect to mention there are over thousands of miles of pipeline already crossing the aquifer (Nebraska’s major source of irrigation and drinking water) as illustrated by the map below. Yet, little state or national attention was directed to the planning and construction of these oil and gas pipelines. Why? Because decades of experience and review demonstrate that the risk to the environment from our 2.1 million miles of pipelines is minimal. So why is so much attention being given to a state-of-the-art pipeline like Keystone XL?

McCown_map.JPG

The answer is simple. Opposition to Keystone XL by the environmental lobby has little to do with pipeline safety, and everything to do with a broader anti-oil agenda. Take for example the public hearings held in Washington last week. Several activists publically confessed that by blocking the pipeline, all they hoped to do was to delay new oil production for a few years.

For example, take the alleged illegal grass-mowing activities now at the center of a lawsuit filed by nationally funded environmental organizations. They claim TransCanada’s conservation efforts to discourage the American burying beetle from reproducing around the proposed pipeline route constitute unauthorized construction activity. Just like the pipeline safety argument, these insinuations are little more than scare tactics aimed at stalling development of Canada’s vast oil reserves.

What many Keystone opponents fail to understand is that the oil sands (currently the second largest known reserve in the world) will be developed regardless of whether the pipeline is approved. Should the U.S. choose not be the beneficiary of the 1 million barrels of oil transmitted by the Keystone system each day, the oil will be sold to other countries, most likely China. This oil represents our nation’s best opportunity in decades to reduce our reliance on oil from foreign countries with less than stellar human rights, environmental, and political records in favor of oil from our largest and most secure ally and trading partner, Canada.

If we allow a few small, yet vocal, groups of activists to hold our energy security hostage, the U.S. will not only lose the opportunity to reduce our current reliance on oil from these volatile sources, but we will lose out on the tens of thousands of jobs this $7 billion dollar project will bring to our economy. Losing more jobs to overseas countries is the last thing the U.S. should be contemplating while facing a 9.1 percent unemployment rate.

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October 11, 2011 4:56 PM

Pipeline Not in the National Interest

By Gene Karpinski

President, League of Conservation Voters

The State Department should deny the permit to build the Keystone XL pipeline. This harmful pipeline would transport tar sands oil – the dirtiest oil on the planet – from Canada's boreal forest across six states in the middle of the country to an international shipping port in Texas.

The Keystone XL pipeline would threaten the environment with far more global warming pollution than conventional crude oil; in fact, it is in direct conflict with the many positive steps the administration has taken to reduce global warming pollution. For example, the Environmental Protection Agency has estimated that this pipeline could add an additional 27 million metric tons of greenhouse gases into the atmosphere in 2018, which is like adding an additional 4.8 million cars to the road. This would clearly offset the emissions reductions achieved by the EPA's recently proposed tailpipe standard for medium and light duty trucks, which is set to reduce U.S. emissions by 25 million metric tons in 2018.

In addition to being disastrous when it comes to combating climate ...

The State Department should deny the permit to build the Keystone XL pipeline. This harmful pipeline would transport tar sands oil – the dirtiest oil on the planet – from Canada's boreal forest across six states in the middle of the country to an international shipping port in Texas.

The Keystone XL pipeline would threaten the environment with far more global warming pollution than conventional crude oil; in fact, it is in direct conflict with the many positive steps the administration has taken to reduce global warming pollution. For example, the Environmental Protection Agency has estimated that this pipeline could add an additional 27 million metric tons of greenhouse gases into the atmosphere in 2018, which is like adding an additional 4.8 million cars to the road. This would clearly offset the emissions reductions achieved by the EPA's recently proposed tailpipe standard for medium and light duty trucks, which is set to reduce U.S. emissions by 25 million metric tons in 2018.

In addition to being disastrous when it comes to combating climate change, the Keystone XL pipeline would also jeopardize surrounding communities, ecosystems, and watersheds. There have been all too many recent reminders of the threats from oil spills, which are exacerbated by tar sands oil since it is more corrosive and abrasive than normal crude oil. Just this summer, a July 1st oil spill on the Yellowstone River resulted in 1,000 barrels of crude as far as 200 miles downstream, and on July 22nd a TransCanada natural gas pipeline ruptured in Wyoming. Moreover, the original Keystone pipeline has already had at least 14 spills in the United States and 19 in Canada. A serious spill could contaminate the Midwest’s Ogallala aquifer, a major water supply and source of agriculture irrigation water to much of the Great Plains.

The Keystone XL pipeline would also enable big oil companies to manipulate the supply of tar sands in the United States in order to raise gas prices throughout the Midwest while affording them the opportunity to begin exporting this harmful product around the world. In addition, a recent assessment by the Cornell University Global Labor Institute effectively debunks TransCanada’s inflated jobs estimates, stating that “the construction of Keystone XL will create far fewer jobs in the U.S. than its proponents have claimed and may actually destroy more jobs than it generates.”

And then there’s the glaring conflict of interest associated with the State Department’s approval process. The State Department’s Environmental Impact Statement was prepared with the help of Cardno ENTRIX, a consulting firm that actually works for TransCanada. The draft EIS, which claimed the pipeline would have "limited adverse environmental impacts," has since been deemed "inadequate" by EPA reviewers.

For these reasons and for many others, this pipeline is simply not in the national interest. To the contrary, it is just another harmful proposal pushed by Big Oil and its allies in Congress in order to promote the failed energy policies of the past rather than pursuing clean energy solutions that will create jobs, improve our national security, and protect the planet from global warming pollution.

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October 11, 2011 7:05 AM

Three Key Reasons To Build Pipeline

By Tom Wolf

Executive Director, Energy Council Illinois Chamber of Commerce

Even though the pipeline doesn’t come close to Illinois, our experiences here provide the three key reasons why the Keystone XL Pipeline project should be approved:

1) Clinton did it once already – what’s changed? -- In 2009 Secretary Clinton approved a pipeline from Canada into Minnesota, Wisconsin and Illinois. It’s the same permit. It’s the same oil. It’s the same pipeline technology. The geography isn’t that different. What rationale would they have to approve that project in 2009 and not approve the Keystone XL pipeline in 2011?

2) Pipelines are still safe – Oh, and by the way we have thousands of miles of underground pipelines traversing Illinois. Over hill and over dale. Over aquifers and groundwater. Under rivers, streams and fens. The very few times a pipeline has failed the affects are dramatic, but not long lasting. Pipelines are as safe and reliable as it gets.

3) Oil from Canada is still good – They are our number one trading partner and our number one a...

Even though the pipeline doesn’t come close to Illinois, our experiences here provide the three key reasons why the Keystone XL Pipeline project should be approved:

1) Clinton did it once already – what’s changed? -- In 2009 Secretary Clinton approved a pipeline from Canada into Minnesota, Wisconsin and Illinois. It’s the same permit. It’s the same oil. It’s the same pipeline technology. The geography isn’t that different. What rationale would they have to approve that project in 2009 and not approve the Keystone XL pipeline in 2011?

2) Pipelines are still safe – Oh, and by the way we have thousands of miles of underground pipelines traversing Illinois. Over hill and over dale. Over aquifers and groundwater. Under rivers, streams and fens. The very few times a pipeline has failed the affects are dramatic, but not long lasting. Pipelines are as safe and reliable as it gets.

3) Oil from Canada is still good – They are our number one trading partner and our number one ally. They actually care about the environment. They have lowered the environmental impact of oil sands production and continue to strive to do better. Why? They are a democracy and the people are demanding it.

You notice I didn’t mention jobs? Jobs are certainly important but not more important than long-term energy policy. If the policy didn’t make sense, the jobs would be superfluous. The good news is the policy does make sense and it also creates jobs. Enjoy the win-win -- we don’t get the chance to do that very often.

Process is important but this had taken long enough. Just say “yes” to more oil from Canada.

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October 11, 2011 7:03 AM

Follow The Law

By Bill Snape

Senior Counsel, Center For Biological Diversity

For starters, the Obama administration should follow existing law – the National Environmental Policy Act, Endangered Species Act, and various procurement rules, among others – in permitting TransCanada to build such a dangerous project. It is clear that the State Department’s neutrality has been compromised by corporate influence, as construction activity has already begun despite the well-established legal prohibition against exhausting resources before final agency approval. Further, whatever short-term temporary jobs that could be gained by construction of the pipeline are more than offset by dangers to water supplies, massive threats to wildlife and natural habitat, and continued addiction to one of the dirtiest greenhouse fuels around. Let China import this stuff: the negative economic and ecological costs will soon make the endeavor an obvious boondoggle. The future is clean energy.

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October 11, 2011 7:01 AM

Hard Facts Compel Keystone Approval

By David Holt

President, Consumer Energy Alliance

As with all decisions around our domestic energy policy, we have to look at the full picture and evaluate how any project will affect our economy -- on both national and regional levels, our economic security, our environment and our overall national interest. In the case of the Keystone XL Pipeline project, the hard facts speak overwhelmingly in the favor of moving forward with this critical project.

Construction of the pipeline project, which will bring 700,000 barrels per day from Oklahoma, the Dakotas, Montana and Alberta to the Gulf Coast refineries, will create tens of thousands of American jobs across the country from direct construction and manufacturing jobs to indirect jobs that will supports the operation of the pipeline. The additional flow of oil will also return US refineries in the Gulf to their pre-Macondo production levels. This $20 billion shot in the arm to the US economy is the kind of large-scale infrastructure project that our economy is desperate for right now and the government doesn’t have to foot the bill -- a free stimulus project....

As with all decisions around our domestic energy policy, we have to look at the full picture and evaluate how any project will affect our economy -- on both national and regional levels, our economic security, our environment and our overall national interest. In the case of the Keystone XL Pipeline project, the hard facts speak overwhelmingly in the favor of moving forward with this critical project.

Construction of the pipeline project, which will bring 700,000 barrels per day from Oklahoma, the Dakotas, Montana and Alberta to the Gulf Coast refineries, will create tens of thousands of American jobs across the country from direct construction and manufacturing jobs to indirect jobs that will supports the operation of the pipeline. The additional flow of oil will also return US refineries in the Gulf to their pre-Macondo production levels. This $20 billion shot in the arm to the US economy is the kind of large-scale infrastructure project that our economy is desperate for right now and the government doesn’t have to foot the bill -- a free stimulus project.

In addition to the jobs the project will create, the steady flow of North American oil will provide consumers and businesses with lower gas and diesel prices, generate billions of dollars in tax revenues for federal, state and local governments, significantly reduce our reliance on overseas oil and increase our energy security. On top of all this, the pipeline is engineered to be the safest pipeline ever built in order to provide maximum protection for the environment.

The Keystone XL pipeline truly has the ability to unite all Americans along our common goals – more American jobs, lower gas prices, a stronger economy and increased security for the United States. This is why CEA, along with the National Association of Manufacturers, American Trucking Associations, Ports to Plains Alliance and 22 of our state-based affiliates submitted more than 450,000 comments to the State Department last week supporting the Keystone XL and urging the Department to allow TransCanada to move forward with the construction of this important project.

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October 11, 2011 6:59 AM

Keystone Makes Logical Sense

By Bernard L. Weinstein

Associate Director, Maguire Energy Institute at Southern Methodist University and George W. Bush Institute Fellow

Canada, not the Middle East, is the number one supplier of oil to the United States, a symbiotic relationship that has existed for decades. What’s more, the Canadian Province of Alberta is home to the world’s third largest petroleum reserves. Viewing America as the most logical market for its expanding production, the Government of Alberta and the TransCanada Corporation are proposing a pipeline called Keystone XL to bring crude oil from Alberta to refineries along the Texas and Louisiana Gulf Coast.

The economic benefits from constructing the pipeline have been well publicized: $20 billion of new investment, 13,000 new American jobs in construction and related manufacturing, and more than 100,000 “spin-off” jobs during the two-year construction period. But more important than the short-term stimulus, which is certainly needed in today’s moribund economy, once completed the pipeline will enhance America’s energy and national security.

Today, most of the crude oil processed by Gulf Coast refineries comes from Mexico and Vene...

Canada, not the Middle East, is the number one supplier of oil to the United States, a symbiotic relationship that has existed for decades. What’s more, the Canadian Province of Alberta is home to the world’s third largest petroleum reserves. Viewing America as the most logical market for its expanding production, the Government of Alberta and the TransCanada Corporation are proposing a pipeline called Keystone XL to bring crude oil from Alberta to refineries along the Texas and Louisiana Gulf Coast.

The economic benefits from constructing the pipeline have been well publicized: $20 billion of new investment, 13,000 new American jobs in construction and related manufacturing, and more than 100,000 “spin-off” jobs during the two-year construction period. But more important than the short-term stimulus, which is certainly needed in today’s moribund economy, once completed the pipeline will enhance America’s energy and national security.

Today, most of the crude oil processed by Gulf Coast refineries comes from Mexico and Venezuela. Production in both countries has declined in recent years, and while U.S.-Mexico political relations are friendly, U.S.-Venezuela relations are anything but. By contrast, Canada is a strong and reliable American ally as well as a key NAFTA partner.

TransCanada already operates a pipeline from Alberta to Cushing, Oklahoma, and the XL would simply shorten the route while adding an extension from Oklahoma to the Gulf Coast. Lower transportation costs associated with the XL would save Gulf Coast refiners almost $500 million annually that, in turn, could mean lower prices for consumers at the gas pump. The planned route of the XL also would link oil producers in the booming North Dakota Bakken region to the national pipeline network, providing efficiency gains between $36 and $146 million annually, according to a recent study by the Energy Policy Research Foundation.

Though opponents argue the pipeline is inherently dangerous because of potential harm to farms, wildlife and water aquifers as it cuts across Montana, the Dakotas, Nebraska, Kansas, Oklahoma and Texas, in truth the anti-XL campaign is aimed against expansion of the Alberta oil sands. Environmentalists claim production in the oil sands is contributing disproportionately to greenhouse gas emissions, destroying the arboreal forests, and killing migratory birds, though they offer no evidence to support these contentions. Indeed, relative to both the geographic and carbon footprints of most onshore and offshore oil production, the Alberta oil sands compare quite favorably.

If the Keystone XL project is blocked, the pace of oil sands development in Alberta won’t diminish. Recent investments by Chinese companies suggest a growing alternative market across the Pacific. But without the pipeline, America will be unable to benefit from cost-efficient Western Canadian oil while Gulf Coast refiners remain dependent upon unstable suppliers.

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October 11, 2011 6:56 AM

Pipeline is in U.S. National Interest

By Charles Drevna

President, American Fuel & Petrochemical Manufacturers

The Keystone XL pipeline should win State Department approval because it is a safe and environmentally sound project that would provide tremendous benefits to the United States. The pipeline would bring our nation an abundant supply of oil from our closest friend and ally Canada, create badly needed American jobs, and strengthen our economic and national security.

If Keystone XL is not built, Canada will send its oil across the Pacific to China, resulting in economic benefit to the Chinese rather than to our own country.

The Canadian Energy Research Institute reports that the Keystone XL pipeline could support close to 85,000 U.S. jobs in 2020. The institute estimates that roughly a half-million Americans could be working in jobs supported by Canadian oil sands investments in the United States by 2035.

With a new Labor Department report on Friday showing that the U.S. unemployment rate remained stuck at 9.1 percent in September, how can anyone question the need to create more American jobs?

Completion of the Keystone XL pipeline would also create many...

The Keystone XL pipeline should win State Department approval because it is a safe and environmentally sound project that would provide tremendous benefits to the United States. The pipeline would bring our nation an abundant supply of oil from our closest friend and ally Canada, create badly needed American jobs, and strengthen our economic and national security.

If Keystone XL is not built, Canada will send its oil across the Pacific to China, resulting in economic benefit to the Chinese rather than to our own country.

The Canadian Energy Research Institute reports that the Keystone XL pipeline could support close to 85,000 U.S. jobs in 2020. The institute estimates that roughly a half-million Americans could be working in jobs supported by Canadian oil sands investments in the United States by 2035.

With a new Labor Department report on Friday showing that the U.S. unemployment rate remained stuck at 9.1 percent in September, how can anyone question the need to create more American jobs?

Completion of the Keystone XL pipeline would also create many other significant contributions to the U.S. economy. To cite just one example, once the pipeline is operational, the states along the pipeline route – Montana, South Dakota, Nebraska, Kansas, Oklahoma and Texas – are expected to receive an additional $5.2 billion in personal income taxes and property taxes during the estimated operating life of the pipeline. Billions more in tax payments would go to the U.S. government.

Although the U.S. oil market cannot be isolated from price shifts in the world market, history has shown that adding new supplies of crude oil to the world market mitigates cost volatility. With immense reserves of more than 175 billion barrels, Canada has the second-largest oil reserves in the world and represents one of the most promising new supply sources.

Canada is already the largest supplier of oil to the U.S, providing nearly 2 million barrels per day. The Keystone XL pipeline would allow us to increase imports from our North American ally by more than 500,000 barrels of oil per day.

The Energy Policy Research Foundation says that the Keystone XL pipeline combined with an existing pipeline would bring more than 1.1 million barrels of oil per day to the U.S. from Canadian oil sands through the Keystone pipeline system. There is also the potential for new oil supplies from the Bakken and Williston formations in North Dakota, Wyoming, and Montana that would offer considerable expansion of North American supplies.

Oil pipelines have a long record of safely operating in the United States. Our nation already relies on a network of more than 168,000 miles of liquid pipelines to safely and efficiently transport oil to provide energy that is vital to fuel our nation. Pipelines provide a safe, reliable, economical and environmentally favorable way to transport petroleum products throughout the United States.

There is no debating the fact that America needs safe and reliable energy and America needs jobs. The Keystone XL pipeline can provide both. If we turn our back on this important source of energy, we will be imposing economic sanctions on ourselves.

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October 11, 2011 6:52 AM

Facts Should Drive Keystone Decision

By William O'Keefe

CEO, George C. Marshall Institute

Facts—not overblown rhetoric and political pressure—should be the basis for the Obama administration’s decision on the Keystone XL Pipeline. And it looks as if Secretary Clinton has gone to great lengths to ensure that’s the case.

In accordance with the Presidential Permit consultation process, the State Department commissioned and then shared Environmental Impact Statements (EIS) on the project with other federal agencies for feedback. Federal officials then took this a step further and solicited public comments—both online and in 10 meetings in the six states through which the proposed pipeline extension would pass as well as Washington, DC.

These opportunities for the public to comment are noteworthy, because Administrative Procedure Act does not require agencies to hold such sessions for Presidential Permits. That means the project’s opponents had extraordinary occasion to voice their concerns to the State Department. Yet since the facts are not on their side, they are turning instead to pressure politics.

Independen...

Facts—not overblown rhetoric and political pressure—should be the basis for the Obama administration’s decision on the Keystone XL Pipeline. And it looks as if Secretary Clinton has gone to great lengths to ensure that’s the case.

In accordance with the Presidential Permit consultation process, the State Department commissioned and then shared Environmental Impact Statements (EIS) on the project with other federal agencies for feedback. Federal officials then took this a step further and solicited public comments—both online and in 10 meetings in the six states through which the proposed pipeline extension would pass as well as Washington, DC.

These opportunities for the public to comment are noteworthy, because Administrative Procedure Act does not require agencies to hold such sessions for Presidential Permits. That means the project’s opponents had extraordinary occasion to voice their concerns to the State Department. Yet since the facts are not on their side, they are turning instead to pressure politics.

Independent of what U.S. officials ultimately decide, Canada will develop its oil sands. Forfeiting domestic production runs counter to the country’s best interests. The true question at hand then is where will those resources ultimately go?

With the latest forecast by the International Energy Agency showing global energy demand jumping 36 percent over the next 24 years, plenty of other countries will be more than willing to vie for oil and gas resources. Either America can build a stronger relationship with Canada by approving this project or we can tell our neighbor to the North to ship it to emerging countries like China. The latter option runs afoul of our energy, environmental, and economic objectives.

We have decades and decades of experience in building and operating more than two million miles of pipelines safely. By providing a very cost-effective way to move petroleum and products—especially when compared to alternative methods (ie. truck, tanker, or barge)—our pipeline network minimizes the price we pay for transportation fuel and heating oil.

In light of all of the attention that has been given to the Keystone XL Project, it is a virtual certainty that increased emphasis will be given to minimizing environmental risks. And that’s precisely what the State Department’s EIS determined. Doing one handed analysis that only considers a single set of risks—as many opponents have done—is simply part of an agenda of distortion.

Construction and maintenance of this 1,700 mile pipeline will secure a $7 billion capital investment in the U.S. and generate a large number of American jobs. Those economic benefits will not be limited to the areas where the pipeline runs but all the regions that supply the material to build it. With our economy still struggling (and perhaps on the brink of another recession), political debate over whether the number of direct and indirect jobs created from this private investment would be 120,000 or somewhat less seems somewhat superfluous. Our economy needs more good paying jobs and increased capital investment. This project will provide both.

CNN Money reporter Steve Hargreaves underscores that point by noting that analysts forecast “jobs and energy prices will ultimately push the Obama administration to approve the controversial Keystone pipeline.”

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