More Jobs Should Be Coming Down the Pipeline

May 11, 2012 12:53 pm | Categories:

Miles City Star (Montana)

May 11, 2012
By JT Born Sr.—UA Pipeliners Local 798

In mid-January, the Obama Administration made a devastating decision for America’s unemployed. State Department officials announced that they had decided to deny approval for Keystone XL—a pipeline that would have transported oil from Alberta, Canada to refineries in the United States.

Construction of the pipeline was expected to directly create 20,000 new jobs and stimulate the creation of 500,000 additional positions by 2035. The pipeline enters the U.S. through Baker, Montana, so thousands of those jobs were going to end up right in our home state.

These positions were particularly vital for skilled craft workers. While the national unemployment rate dropped to 8.5 percent in January, the rate in the construction industry actually increased to 16 percent. There was already a Project Labor Agreement in place on the pipeline project, ensuring it would be safely constructed by the best-trained American workers being paid good wages.

Yet the Obama administration decided to reject Keystone XL. Needless to say, labor groups were profoundly disappointed.

The reality is that concerns from politically powerful environmentalists trumped the cries from unemployed American workers. The project has already undergone years of government regulatory review, which concluded the project is safe. Our own state regulators and the Montana Department of Environmental Quality also gave the project an environmental seal of approval.

Aside from jobs, the project will contribute to the overall growth of the economy. The pipeline is entirely privately funded and represents a $14 billion investment, $7 billion of that in the U.S. economy. An independent study by the Perryman Group concluded the Keystone XL Project will have positive economic effects “permeating the entire economy” and will produce “sizeable gains from the construction stimulus.”

While the pipeline originates in Canada, it would also have been a boon to oil production here in Montana. “Some people say this pipeline is just about the oil sands; it is not. It is also about Bakken [Shale] oil in Montana,” noted Gov. Brian Schweitzer. The project is also estimated to provide Montana with $60 million in new property taxes annually.

Keystone XL would also be a boon to our national security, cutting down our dependence on oil from unfriendly countries. Oil provided by the completed pipeline could replace about half of what we’re currently importing from the Persian Gulf.

But despite the obvious benefits, some environmentalist critics spread disinformation about the project. They claimed that crude from oil sands has a much bigger carbon footprint. That’s just not true. Greenhouse gas emissions from Canadian oil sands are similar to that of oil we’re currently importing from many foreign sources, such as Venezuela and Nigeria.

Critics also claimed that oil sands crude is more corrosive. That’s also just not true. Large parts of the country are already using gasoline produced from oil sands without problems…and have been for decades.

Some Keystone opponents are simply committed to stopping all energy production in its tracks. But that’s just not feasible. The U.S. Energy Information Administration (EIA) estimates that due to population growth, we’ll need 16 percent more energy than what we currently consume by 2035.

While we can and should invest more in renewable energy, the EIA projects it will only make up 13 percent of our energy sources by 2035. We have no choice but to build up our infrastructure for traditional energy sources.

Ultimately, stopping the Keystone XL pipeline won’t do anything for the environment. Canadians are going to ramp up oil production no matter what. If a pipeline doesn’t facilitate selling to the U.S. market, there’s a rapacious energy market across the pacific in Asia and they’ll sell it there. And the carbon footprint could end up being much bigger because the oil is being shipped farther.

For years now, our partners in Canada have grown increasingly impatient with the Keystone XL delays. Canadian Natural Resources Minister Joe Oliver recently complained that opponents of the pipeline were taking a “quintessential American approach: sue everyone and anyone to delay the project even further.”

That criticism stings because there’s a little bit of truth to it. But, ultimately, American workers, not frivolous lawsuits and petty politicking, are what this country is all about.

Fortunately, there is still a compromise available. In its denial, administration officials made it clear that their concerns center around the roughly 20 percent of Keystone running through the Sand Hills region in Nebraska and the Ogallala aquifer. Importantly, officials were not opposed to the project overall—they just wanted more time to study these particular areas of the project.

That leaves 80 percent of the pipeline good-to-go. And those sections have already undergone over two-years of thorough environmental review.

Regulators should allow construction to start on these uncontested parts of the pipeline. Doing so will immediately stimulate these desperately need jobs, while giving the administration additional time to evaluate those parts of the pipeline that it’s actually concerned about.

There’s nothing else to study for 80 percent of Keystone. Let’s get started there.