Obama poised to back revamped Keystone
President Barack Obama ordered u.s. government agencies on Wednesday to fast track approval of the southern leg of the Keystone XL pipeline, boosting TransCanada Corp.’s plans for speedy construction of the $2.3-billion project.
Before a speech Obama is to give today in cushing, okla., the White house said the president is issuing a memorandum to U.S. government departments to “expedite” permitting of the planned pipeline.
Transcanada executive Robert Jones, vice-president of the existing Keystone pipeline, will be at Obama’s side at the speech, although the Calgary company declined to speculate on what the president might say.
The president had signalled his support for the southernmost portion of Keystone XL as a stand-alone pipeline that would not require more rigorous review and a special presidential permit.
“We’re obviously pleased with (Obama’s backing), and like we said before, whether it’s legislation or things that different agencies are able to do, any efforts to expedite the approval of this project” are welcome, said a Transcanada Corp. spokesman, Shawn Howard.
Transcanada opted to proceed with the southern leg of Keystone XL, now formally called the Gulf Coast project, following Obama’s rejection of the company’s application for a permit to build the entire 2,700-kilometre pipeline from Hardisty to the Gulf Coast. It has said the southern leg could be complete by mid-2013.
“The Gulf Coast project already has had three years of environmental and technical reviews done. All that work is done, and all that work applies to here,” Howard said.
“We need some final permits and that is what we are working on securing.”
According to the White House, Obama will issue an executive order, first announced in his State of the Union address, “to make faster permitting and review decisions for vital infrastructure projects” in the U.S.
The executive order will direct U.S. agencies by the end of April to identify “regionally and nationally significant infrastructure projects” — including pipelines — for better tracking and review. A separate steering committee will be set up to develop, by the end of May, clear timelines for speeding up approval.
A “specific memorandum” will be issued designating the pipeline as the “top priority” because of the need to relieve a glut of oil at the Cushing hub, the White House said.
“The president has been very clear . . . about his support for the building of the pipeline, the so-called Cushing pipeline,” said White House spokesman Jay Carney, “because of the glut of oil in Cushing and the need to move that product to the Gulf for refining.”
That glut has pulled down oil prices in North America, increasing the discount for Canadian crude to U.S. price benchmark West Texas Intermediate oil, and WTI to Europe’s Brent oil price.
Obama’s speech today in Cushing is part of a four-state tour aimed at promoting his “all of the above” approach to increasing u.s. energy independence, a wide-ranging policy he says encourages responsible oil production alongside development of alternative energy sources.
By backing the southern leg of Keystone XL, Obama is trying to walk a fine political line. He wants to limit potential electionyear damage from Republicans who say his opposition to the larger Keystone XL route has cost the U.S. thousands of construction jobs and could lead to higher gas prices.
At the same time, he is hoping environment a lists will continue to give him credit for denying Keystone XL even as he approves its southern portion.
So far, the plan isn’t working — he’s managed to anger both environmentalists and energy companies at the same time.
“We completely disagree with anything that would fast track or expedite federal permits for the southern leg of the Keystone XL pipeline,” said Susan Casey-lefkowitz, international programs director for the Natural Resources Defense Council.
A quartet of top U.S. oil industry executives said Obama’s backing of the southern leg amounted to a half-measure.
“Approval of the entire Keystone XL pipeline should happen now — not after the election,” the oilmen wrote in an editorial published Wednesday in the oklahoman newspaper. The authors included Harold Hamm of Continental Resources, Aubrey Mcclendon of Chesapeake Energy, Larry Nichols of Devon Energy and Tom Ward of Sandridge Energy.