Obama administration rejects Keystone XL pipeline

View Photo Gallery —  The controversial Keystone XL pipeline has been under review for more than three years. Environmental groups have argued that the extraction of oil sands contributes to climate change and the pipeline poses leak risks. Supporters of the project say it will create jobs and enhance energy security. Here’s a look at some of the key players in the pipeline plan and the protests against it.

Sierra Club Executive Director Michael Brune said in a phone interview that the White House is sending a strong message to voters in rejecting the pipeline, demonstrating Obama’s “enduring commitment to breaking our dependence on oil.”

Republicans and their allies are just as eager to make the pipeline a decisive issue in the presidential election. U.S. Chamber of Commerce President Thomas J. Donohue issued a statement Wednesday saying, “This political decision offers hard evidence that creating jobs is not a high priority for this administration.”

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Raising the stakes in a bitter election-year fight with Republicans, President Obama on Wednesday rejected a Canadian company's plan to build a 1,700-mile pipeline to carry oil across six U.S. states to Texas refineries. (Jan. 18)

Raising the stakes in a bitter election-year fight with Republicans, President Obama on Wednesday rejected a Canadian company's plan to build a 1,700-mile pipeline to carry oil across six U.S. states to Texas refineries. (Jan. 18)

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The jobs issue has been a major point of contention. Ads taken out by pipeline supporters routinely say the project would create 20,000 jobs. But TransCanada’s Girling has said that Keystone XL would create 20,000 “job-years” — including 13,000 for direct construction and 7,000 for supply manufacturers. Construction would last two years, and the number of construction workers employed each year would total 6,500, Girling has said.

Moreover, TransCanada has already spent $1.9 billion buying pipeline parts, reducing the number of supply-chain jobs that could be created in the future.

Nonetheless, James T. Callahan, president of the International Union of Operating Engineers, called Obama’s decision “a blow to America’s construction workers” in “the sector hardest hit by the recession.”

Obama tried to defuse one criticism on Wednesday by saying his administration will explore ways to relieve the pipeline bottleneck that is slowing oil shipments between a major terminal in Cushing, Okla., and the nation’s Gulf Coast refineries.Oil produced in Montana and North Dakota is being taken by truck and train to refineries.

The American Petroleum Institute has been waging a no-holds-barred television ad campaign hammering Obama on the pipeline permit. During the week of Jan. 9, the API spent $605,510 on ads in six states and the District, according to CMAG/Kantar Media. The largest amounts were spent in crucial electoral battlegrounds in the Midwest, including Illinois, Michigan and Ohio.

API President Jack Gerard said Wednesday that Obama’s decision was “a clear abdication of presidential leadership.”

But Stephen Brown, vice president of federal government affairs for the oil refiner Tesoro, said he was not surprised. “Today’s decision will be a fairly easy one for the White House to make,” he wrote in an e-mail. “No one who was planning on voting against the president would have been won over simply because of the approval of Keystone.”Engler said, “I just think the timing was such that the politics got in the way of the decision and that it will be approved pretty quickly once the elections are out of the way.”

Staff writers David Nakamura, Karen Tumulty, David A. Fahrenthold and T.W. Farnam contributed to this report.

 
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