Published on -1/30/2013, 10:32 AM
Recall the firestorm created during last year's presidential election surrounding the Keystone XL pipeline? When President Barack Obama rejected the $7 billion project by TransCanada because the proposed route through Nebraska passed under the Ogallala Aquifer, he was hailed by the left as a champion for the environment and reviled by the right as a jobs-killer.
As so often happens with projects caught up in political maelstroms, neither side was correct. But expect to hear even more from both now that the proposal is positioned away from sensitive areas in Nebraska -- and the overall matter is back in front of the federal government.
A quick review of the facts:
* The 1,700-mile long Keystone pipeline will carry 700,000 barrels of crude oil from Alberta, Canada, to refineries along the coast of the Gulf of Mexico.
* Much of the route is constructed. The presidential permit, which is issued by the U.S. State Department, is needed simply because the pipeline crosses the U.S.-Canadian border.
* Nebraska Gov. Dave Heineman approved a new route through his state that avoids both the Ogallala and the sensitive Sandhills region.
* Extracting crude from the oil sands in Alberta is a dirtier process than other sources, which threatens to increase greenhouse gas emissions. Forests need to be clear-cut to get to the sands. Extracting the oil from tar sands and then liquefying it in order to flow through a pipeline almost doubles the greenhouse gases produced from other sources.
At issue from a political perspective hasn't been the facts, however. The project has been portrayed as a classic battle between capitalists and environmentalists. Allow the project and you increase the effects of global warming. Disallow the project and not only is free enterprise stifled, but an enormous number of U.S. jobs will not be created.
As it turns out, most of the rhetoric is ... rhetoric. Not surprising, in our eyes.
Consider the environmental claims. The EPA has estimated an additional 27 million metric tons of greenhouse gases will be spewed into the air if the Keystone XL pipeline is built and carries the maximum volume. The figure is derived by comparing average U.S. crude oil.
We do not doubt such analysis. But we also realize for all the green efforts taking place or discussed, the world still moves on fossil fuels. Alternative energy sources have not been developed on massive enough scales to replace the power produced by oil and coal. The United States and other developed nations simply won't give up standards of living in hopes they'll be reinstated. Developing nations don't take kindly to suggestions they do without the things others have come accustomed to.
If the Keystone project is rejected, the alternative would be worse from an environmental perspective. Alberta will pull the crude from the tar sands. If the U.S. doesn't want it, China does. There already are plans for a different pipeline to go west to the Pacific coast and ship the crude by tanker. Tankers have a much higher incidence rate than pipelines. And, the greenhouse gases still will be produced.
The jobs argument is even flimsier. TransCanada originally suggested the project would produce 20,000 jobs in the U.S., including 13,000 positions in construction and 7,000 in manufacturing. That number kept increasing. U.S. House Speak John Boehner said the project would create 100,000 jobs. The U.S. Chamber of Commerce said 250,000 permanent U.S. jobs would be created.
The State Department wasn't as optimistic. It suggested only 5,000 to 6,000 positions would result. The Cornell University Global Labor Institute ratcheted it down to a mere 500 to 1,400 temporary construction jobs.
In an interview with CNN, the company said most of the jobs would be temporary and the number of permanent positions in the U.S. would number in the "hundreds."
It strikes us as obvious this project does not offer much in the way of stimulating our economy. Kansas already knows that from its experience with the portion that runs across the eastern part of the state, connecting Nebraska with Oklahoma. The state used eminent domain to obtain the private property needed, then proceeded to give TransCanada 10 years of property tax exemption -- effectively robbing local governments of some $50 million in public revenue. The decade-long moratorium was granted without a request from TransCanada; the firm said it would have built the route regardless.
All is not lost for the Sunflower State, however. Wichita-based Koch Industries controls almost 25 percent of all tar sands crude oil that's imported into the U.S. At least somebody will prosper from the project.
Truly, the only way to look at the project is whether we want oil from a neighboring friend or continue to rely on imports from the volatile Middle East. That is the decision facing the president and the State Department.
Our recommendation: Approve the project and let the oil flow. The Keystone XL project is decidedly the lesser of two evils.
Editorial by Patrick Lowry