Keystone Pipeline Decision LoomsAccording to most polls, there is general support for the construction and operation of the Keystone XL Pipeline. Most people are familiar with the basic facts about the pipeline. It will have the capacity to transport over 800,000 barrels of oil per day from the tar sands of Alberta, Canada to the refineries of the Gulf Coast, significantly reducing dependence on oil from Venezuela and the Middle East. It will create thousands of jobs in the construction and pipe fabrication fields, providing a boost to a sluggish economy. Overall, the project will add billions to the gross domestic product of the country.
TransCanada’s original application was filed in 2008 and re-filed in May, 2012. The governor of Nebraska approved the pipeline’s revised route through his state so that an important source of drinking water was protected. In March, 2013, the US State Department released a Draft Supplementary Environmental Impact Statement which concluded, among other things, that “there would be no significant impacts to most resources along the proposed [pipeline] route.”
Faced with these positive facts and developments, one would think that a decision by the Obama Administration to approve the application is an easy one. Although a decision is expected by the end of the year, there are indications that the decision will be to deny the application. Many believe that the opponents of the pipeline have swayed President Obama to deny the application. These opponents seem, for the most part, to be against any use of any fossil fuels due to the emission of greenhouse gases, which purportedly leads to climate change (formerly known as global warming). The Alberta tar sands are reported to have a higher carbon content and thus emit a larger amount of greenhouse gases than regular crude oil.
President Obama recently stated that he would oppose the pipeline if it “significantly exacerbates” carbon ‘pollution.’ Obviously, such an ill-defined and vague standard leaves him free to make any decision he wants as there are studies on both sides of the issue. Of course, under this test, he should immediately grant the application as his own State Department found that there was ‘no significant impact.’ Additionally, global warming has paused over the last fifteen years, leading to the suggestion that this test may be irrelevant. Further, the pipeline itself is merely a cost-effective means of conveyance. Rail can be used, albeit at an increased cost. The tar sands in Alberta will be developed and refined, either in the United States or elsewhere, perhaps in China without serious environmental controls. As a result, greenhouse gases will be emitted with or without the pipeline.
In recent speeches and statements, the president also seems to have adopted the ‘talking points’ of pipeline opponents. He questioned the number of jobs the pipeline would create, calling it a ‘blip’ in overall employment. He also indicated that the pipeline will not appreciably reduce gas prices. Such talk has encouraged opponents, who now believe the conventional wisdom is that President Obama will deny the application. A spokesman for the group 350.org was quoted as saying that the president is “picking up on the argument that we need to do something extreme on climate change.”
Will President Obama placate his vocal environmental supporters by denying the application in order to take an ‘extreme’ stand against climate change? Only time will tell. Rest assured, though, that in the coming months voices on both sides of the debate will reach a crescendo in anticipation of the decision.
John B. King is a partner with Breazeale, Sachse & Wilson LLP in Baton Rouge, La. His practice relates mainly to environmental regulatory permitting and compliance. Prior to joining the firm in 2003, he served as chief attorney for enforcement for the Louisiana Department of Environmental Quality.
For more information, please contact John B. King at email@example.com or call (225) 381-8014.