Opponents of Keystone Pipeline Add Economic Arrows to Their Quiver

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The economic impact of the Keystone XL Pipeline is in dispute, but it's unlikely President Obama will wade into that argument.
PR NEWSWIRE
Alex Brown
Sept. 16, 2013, 5:30 p.m.

As Pres­id­ent Obama con­siders the cli­mate im­pact of the Key­stone XL pipeline, some of the pro­ject’s most vo­cal op­pon­ents are put­ting a re­newed fo­cus on its eco­nom­ic ef­fects.

The pipeline, which would carry heavy crude from Canada’s tar sands to U.S. re­finer­ies on the Gulf Coast, is still pending ap­prov­al by the State De­part­ment, and Obama said this sum­mer he will only is­sue a per­mit if the pro­ject does not ex­acer­bate cli­mate change.

En­vir­on­ment­al­ists be­lieve it will, but they also ques­tion ar­gu­ments by pro­ject pro­ponents that the pipeline will be good for Amer­ic­an con­sumers.

“Here’s the truth: Key­stone oil will travel through Amer­ica, not to Amer­ica,” said in­vestor and en­vir­on­ment­al­ist Tom Stey­er, nar­rat­ing an ad run­ning on na­tion­al net­works re­cently. The 90-second spot, backed by Stey­er’s Nex­t­Gen Cli­mate Ac­tion group, is part of a $1 mil­lion ad series op­pos­ing the pipeline.

Stey­er op­poses Key­stone on en­vir­on­ment­al grounds, but his first pitch against it barely men­tions cli­mate change. His ar­gu­ment — that the pipeline hailed as a linch­pin of North Amer­ic­an en­ergy in­de­pend­ence will in­stead be used to ship oil over­seas — is not a new one. The Si­erra Club, 350.org, and oth­er green groups have long held that Key­stone will be an ex­port pipeline, a point dis­puted by its ad­voc­ates.

“The eco­nom­ic ar­gu­ment [for Key­stone] is crum­bling,” said Si­erra Club spokes­man Ed­die Scher. “The idea that the United States is dy­ing for this oil from Canada doesn’t hold up…. After [Obama] re­jects this pipeline, he’s go­ing to have his choice on reas­ons why he did.”

A State De­part­ment ana­lys­is this spring said that less than half of re­fined products from the Gulf Coast — Key­stone’s planned en­d­point — enter the U.S. mar­ket. Al­though the Ca­na­dian-piped oil would not fall un­der U.S. re­stric­tions on its own crude ex­ports, the re­port said the ca­pa­city of Gulf re­finer­ies makes it un­likely the crude would be ex­por­ted in great volume. Once it is re­fined, however, it will be sub­ject to the same mar­ket forces that now see nearly 3 mil­lion bar­rels of U.S. oil shipped over­seas daily.

Dani­elle Droitsch, dir­ect­or of the Nat­ur­al Re­sources De­fense Coun­cil’s Canada Pro­ject, blamed mil­lion-dol­lar ad cam­paigns from Key­stone’s back­ers for the per­cep­tion that the pipeline will be an eco­nom­ic boon. “We ab­so­lutely feel that those eco­nom­ic ar­gu­ments are im­port­ant parts of the con­ver­sa­tion,” she said.

“The pres­id­ent’s cli­mate test for Key­stone … did put us in the po­s­i­tion of need­ing to de­fend that, need­ing to ex­plain why Key­stone will worsen cli­mate change, and we can do that,” Droitsch said. But, she ad­ded, “I firmly be­lieve that the Obama ad­min­is­tra­tion is not just look­ing at the cli­mate is­sue…. [The eco­nom­ic ar­gu­ment is] still im­port­ant, be­cause the Amer­ic­an pub­lic is fo­cused on wheth­er the pipeline is for U.S. en­ergy se­cur­ity.”

Tran­sCanada, the com­pany pro­pos­ing to build the pipeline, main­tains that Key­stone XL will cre­ate 20,000 man­u­fac­tur­ing and con­struc­tion jobs. The White House has down­played Tran­sCanada’s jobs es­tim­ate, but nix­ing Key­stone on the grounds that it might be an oil ex­port­er would con­tra­dict the goals set by his ex­port ini­ti­at­ive.

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