Keystone pipeline issue becomes a headache for the White House

October 7, 2011

The question of how best to handle the federal permit for the TransCanada Keystone XL pipeline extension — which will transport crude oil 1,700 miles from Alberta to Texas — has evolved from a backwater process at the State Department to a high-profile political headache for the Obama administration.

Until recently, it appeared that TransCanada, arguing the pipeline will provide thousands of jobs as well as a safe and secure oil supply to the United States, was likely to obtain a federal construction and operating permit. Nearly a year ago, Secretary of State Hillary Rodham Clinton said she was “inclined” to approve the pipeline.

Labor unions also have endorsed it as a source of jobs.

But the fierce resistance from grass-roots environmental activists — more than 1,250 were arrested in demonstrations outside the White House in late August and early September — and from some influential donors has helped make it a defining environmental question for the Obama administration. Opponents argue that oil extraction from Canada’s “tar sands” produces more greenhouse gases than other forms of crude because it is so energy intensive. That the pipeline traverses environmentally sensitive habitat in the Great Plains has also made it controversial.

On Friday, hundreds of Americans both supporting and opposing the project delivered often-emotional testimony at a public hearing held by the State Department at the Ronald Reagan Building in the District. Attendees cheered speakers they agreed with, shouted or hissed at those they opposed, and those who testified occasionally cried or yelled as they made their points.

The White House, meanwhile, is making higher-level officials available for meetings with environmentalists about the pipeline. It requested additional briefings from State Department officials in the wake of the protests, and Democratic campaign officials are working to assure donors that Obama is committed to clean energy.

“As with many topics, this is an issue that outside groups raise to officials at the White House,” White House spokesman Clark Stevens said. “While we have made clear that the State Department is assessing the project on behalf of the federal government, it should not be a surprise that the White House would be updated on that progress, especially as the process moves along.”

“Until the sit-in, we were meeting with mid-level State Department officials. That has changed,” said Susan Casey-Lefkowitz, who directs the international program for the Natural Resources Defense Council, an advocacy group. Referring to the White House, she added, “They now see this politically as an important issue for them, as they look at the environment, and climate specifically.”

Several donors said the pipeline issue, along with Obama’s recent decision to withdraw a proposal to strengthen national smog standards, had made them question their political support for the president.

Barbarina Heyerdahl, who together with husband Aaron gave nearly $120,000 to either Obama or the Democratic National Committee between 2008 and 2011, has informed the DNC that neither of them will back his 2012 campaign if the administration signs off on the pipeline.

“There’s a whole suite of things I’m distressed by, but the tar sands is the make-or-break issue,” said Heyerdahl, who lives in Shelburne, Vt.

Jabe Blumenthal, who co-chairs the board of the Seattle-based group Climate Solutions and gave the maximum personal contribution to Obama in the last election, just turned down an invitation to a high-dollar event in Seattle. He added that Obama’s fundraisers told him they think the White House is starting to focus on the Keystone decision, but they remain confident environmentalists will ultimately back the president over any Republican rival.

“They may be right. But not when it comes to me,” he said.

On Tuesday, two students from Washington University in St. Louis raised enough money to attend a $250-a-person Obama fundraiser there, during which they unfurled signs written on their clothes and cried out during his remarks, “Please stop the pipeline!” Obama did not directly respond to them, though he commented later in his talk, “We’ve got a couple people here concerned about the environment.”

Hundreds of members of the Laborers’ International Union of North America filled the auditorium at Friday’s hearing; Brent Booker, who directs the union’s construction department, said the project will provide “thousands of jobs” to his members.

“Our members are in dire need of paychecks,” he said in an interview, adding that TransCanada has agreed to provide “middle-class wages” and health insurance for pipeline workers.

Bob Van Der Valk, who lives in Terry, Mont., and works as a petroleum industry analyst, said in contrast to oil shipped in on tankers from overseas, “this pipeline will make money for us.”

“It’s capitalism and it’s good,” he said, to scattered boos.

Shortly afterward, two Nebraska women broke down in tears as they testified. Alaura Luebbe, a rancher’s daughter, sobbed as she spoke of her ranch being threatened by the project, while activist Jane Kleeb declared, “We are the Sand Hills lovers. We are the Ogallala Aquifer lovers. And we are begging you — not asking, we are begging you — to deny this pipeline permit.”

The State Department is in the process of deciding whether the pipeline is in the national interest and has said it will make a final decision on the permit by the end of the year.

Juliet Eilperin is a White House correspondent for The Washington Post, covering domestic and foreign policy as well as the culture of 1600 Pennsylvania Avenue. She is the author of two books—one on sharks, and another on Congress, not to be confused with each other—and has worked for the Post since 1998.
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