June 25, 2014 10:23 am | Categories:
HOUSTON – A business association whose members include some of the world’s biggest energy companies is urging the administration to approve the controversial Keystone XL pipeline, arguing that the southern portion of the project already has shown the positive economic impact the project will have on the country.
The group commissioned a study on the economic effect of the 485-mile portion of Keystone pipeline known as the Gulf Coast Extension, which opened earlier this year linking Oklahoma and Texas. The study highlights benefits the project had on local businesses like restaurants and hotels along the route. It notes that during construction, TransCanada Corp. – the company behind the pipeline – spent $6 million each month directly with local businesses in Texas and Oklahoma.
The project required $2.3 billion in private-sector investment and the work of more than 4,800 people, researchers wrote.
The study was prepared by researchers at the Maguire Energy Institute at Southern Methodist in University for the Consumer Energy Alliance, which lists energy companies like Anadarko Petroleum Corp., BP, Exxon Mobil Corp. and Shell Oil Co. among its members.
The report argues that the country lacks the pipeline capacity to support booming North American energy production and says the increase in shipments of crude oil by rail is inefficient and unsafe.
Boosting economic health
Three of the four phases of the Keystone XL pipeline system have been built. The northern portion, connecting Canada to Nebraska, is awaiting federal approval.
The Gulf Coast Extension portion, which stretches from Cushing, Okla. to Nederland, Tex., crosses 24 counties, most of which are rural and have population growth that’s historically trailed behind state averages.
“Against this backdrop of slow population growth and below-average per capita income, the Gulf Coast Project has been an important contributor to the economic health of many of the 24 affected counties,” the authors wrote.
$3.6 billion for Texas
In Oklahoma, the report says, TransCanada’s spending boosted economic activity by $2.1 billion, and in Texas, the project contributed $3.6 billion to the economy. They say the final phase could similarly have big economic benefits to communities along the route.
Critics have spent years fighting the pipeline, arguing that it has the potential for dangerous spills and will contribute to the demand for fossil fuels that harm the environment.
Earlier this year, the Obama administration announced that federal agencies would have more time to weigh in on the project, essentially guaranteeing that a final decision won’t be made until after the November mid-term elections. Some federal lawmakers have tried – so far unsuccessfully – to force a decision to be made sooner.