Keystone Won’t Be Finished Until 2016. Here’s What That Means.

President Obama speaks at a pipeyard for the southern leg of the Keystone XL Pipeline.
National Journal
Alex Brown
Nov. 20, 2013, 7:15 a.m.

Tran­sCanada ac­know­ledged Tues­day that the Key­stone XL Pipeline — even if ap­proved — will not be op­er­a­tion­al un­til 2016. It’s the latest ad­mis­sion that the pro­ject, long stalled in the fed­er­al ap­prov­al pro­cess, is los­ing rel­ev­ance. The pipeline has been a flash­point of con­tro­versy for en­vir­on­ment­al­ists and in­dustry lead­ers, but as the ad­min­is­tra­tion has drawn out its re­views, the pipeline’s sig­ni­fic­ance from an en­ergy stand­point has faded.

Oil-by-rail trans­port­a­tion has filled the gap in re­cent years where pipelines have met delays. The amount of oil shipped as U.S. train cargo has doubled in the past two years, and Canada is ex­port­ing oil bar­rels in the six fig­ures daily after ship­ping just mar­gin­al amounts a year ago. One oil ex­ec­ut­ive told Na­tion­al Journ­al the rail boom and new pipeline al­tern­at­ives have rendered Key­stone non­es­sen­tial as a trans­port­er of U.S. oil.

The spike in oil ship­ment al­tern­at­ives has come largely over the past two years, and it’s likely to con­tin­ue to ex­pand in the two years it would take to build Key­stone. “Rail has a first-mover ad­vant­age as a trans­port meth­od for crude oil,” con­ceded An­drew Black, pres­id­ent of the As­so­ci­ation of Oil Pipe Lines. “Rail can gain mar­ket share while pipelines race to catch up.” Left un­said is that the pipeline “catch-up” can be stalled by fed­er­al policy, not just con­struc­tion time.

Mean­while, en­vir­on­ment­al groups have taken heat for fo­cus­ing ef­forts on the pipeline. New York Magazine‘s Jonath­an Chait called the fight “mar­gin­ally rel­ev­ant to the cause of stop­ping glob­al warm­ing,” not­ing that the pipeline would con­trib­ute just a few tenths of a per­cent to U.S. green­house-gas emis­sions, while coal-plant emis­sions are far lar­ger.

But that isn’t likely to keep green groups from con­tinu­ing the fight. An In­ter­na­tion­al En­ergy Agency re­port re­leased earli­er this month found that con­struc­tion of the pipeline would cause tar-sands pro­duc­tion to double by 2035. The ad­ded en­vir­on­ment­al and cli­mate costs of that ex­tra pro­duc­tion has ad­ded fuel to the fire of en­vir­on­ment­al­ists’ ar­gu­ments.

No one doubts that Obama’s de­cision on Key­stone will pro­voke heated re­sponses from a vari­ety of stake­hold­ers. But, in­creas­ingly, the volume of the de­bate isn’t matched by the sig­ni­fic­ance of the pro­ject.

What We're Following See More »
Trump to Name VP Search Committee
42 minutes ago

"Donald J. Trump said on Wednesday that he expected to reveal his vice presidential pick sometime in July—before the Republican National Convention in Cleveland—but added that he would soon announce a committee to handle the selection process, which would include Dr. Ben Carson." He said he's inclined to name a traditional political figure, unlike himself.

Business, Nonprofits Panicking Over Labor’s New Overtime Rules
45 minutes ago

"Groups have flocked to the White House Office of Information and Regulatory Affairs to ask for last-minute changes" to the Department of Labor's new overtime rules, which would require that businesses pay overtime to any salaried employee making more than $50,440 per year, up from the current $23,660. Business interests, as well as some nonprofits, say the move could lead to mass change in workers' statuses, from salaried to hourly. "The White House office held 22 meetings on the proposal in April, according to its calendar, and groups say more meetings are planned this week." Last month, National Journal's Alex Brown reported on how the change might affect Washington.

Ed Rollins Joins Pro-Trump Super PAC
50 minutes ago

Republican gun-for-hire Ed Rollins is hopping on the bandwagon, er, the Great America PAC, "an outside group that’s supporting Trump. ... Rollins isn’t the only GOP mainstay coming around to Trump. In recent days, Republican veterans including Republican National Committeeman Ron Kaufman and former Utah Gov. Jon Huntsman have expressed an openness to him."

Report: Kasich Is Bowing Out
1 hours ago

John Kasich is apparently the last domino to fall on the GOP side. NBC is reporting he's suspending his presidential campaign. His path to the Republican nomination seemed all but impossible—even at a contested convention—but he may have finally given up. The Washington Examiner reports Kasich has canceled a press conference at Dulles Airport, "and will instead hold one in Columbus, Ohio, at 5 p.m."

Clinton Ahead by 13 in Early Going
2 hours ago

"As Donald Trump captures the mantle of presumptive Republican nominee, a new poll finds he begins his general election campaign well behind Democratic front-runner Hillary Clinton. The new CNN/ORC Poll, completed ahead of Trump's victory last night, found Clinton leads 54% to 41%, a 13-point edge over the New York businessman, her largest lead since last July. Clinton is also more trusted than Trump on many issues voters rank as critically important, with one big exception. By a 50% to 45% margin, voters say Trump would do a better job handling the economy than Clinton would."