The Impact of Biden Blocking the Keystone Pipeline

Posted on Tuesday, February 16, 2021
by AMAC, Bob Carlstrom
keystone xl

Biden Acts Immediately Against U.S. Fossil Fuel Energy Independence and Kills Jobs in His Broad Reaching Executive Order That Stops Development of the Keystone Pipeline

President Joe Biden spent his first day – January 20 — in the White House signing a spate of executive orders aimed at undoing the policies of the Trump administration, including a broad ranging one to ostensibly protect the environment. This document contains several provisions designed to set the stage for the restoration of increased regulatory costs upon, and lost opportunity for fossil fuel energy development. Section 6 contains an order that revoked the permit for the construction of the Keystone XL pipeline because it was deemed “not consistent with [his] Administration’s economic and climate imperatives.” Biden’s order revokes the permit that was granted March 29, 2019, by then-President Donald Trump to reverse former President Obama’s blocking the pipeline company TC Energy’s request for a permit in 2015.

The Keystone XL pipeline is an international project to build an 875-mile pipeline to carry a heavy crude oil mixture from Western Canada to Steele City, Neb., where it would connect with another leg stretching to Gulf Coast refineries. While a voluminous State Department report on the Keystone XL pipeline found in 2014 that it would not significantly contribute to carbon pollution, its opponents say the pipeline threatens Canadian rivers and forests. And the project has become a symbol for the political debate over fossil fuels. Construction began in April 2020, and to date, only a 1.2-mile section of the pipeline had been completed in Montana near the U.S.-Canada border.

On that same day, oil and gas producers association — American Petroleum Institute (API) — President and CEO Mike Sommers issued a statement on Biden’s incoming presidency criticizing his executive order, saying: 

“… (R)evoking the Keystone XL pipeline is a significant step backwards both for environmental progress and our economic recovery. Pipelines are the safest, most environmentally friendly way to transport energy, and the economy cannot recover at full speed unless we deliver reliable energy from where it is to where it is needed. The Keystone XL Pipeline has been through more than 10 years of extensive environmental reviews, and today’s announcement is a slap in the face to the thousands of union workers who are already a part of this safe and sustainable project. This misguided move will hamper America’s economic recovery, undermine North American energy security and strain relations with one of America’s greatest allies.”

Pipeline company TC Energy projects substantial job losses because of Biden’s action:

“The decision would overturn an unprecedented, comprehensive regulatory process that lasted more than a decade and repeatedly concluded the pipeline would transport much needed energy in an environmentally responsible way while enhancing North American energy security. The action would directly lead to the layoff of thousands of union workers and negatively impact ground-breaking industry commitments to use new renewable energy as well as historic equity partnerships with Indigenous communities.”

Coal and natural gas state West Virginia Sen. Joe Manchin wrote Biden asking him “to reconsider” his executive order. Mr. Manchin, who introduced the first Keystone XL bill in 2012, noted that “pipelines continue to be the safest mode to transport our oil and natural gas resources and they support thousands of high-paying, American union jobs.”  In other words, the pipeline is more environmentally safe than transporting by rail in which derailments have and may well continue to cause substantial spills.

Similarly, AFL-CIO President Richard Trumka said regarding job losses in a recent interview with Axios on HBO that the Laborers’ International Union of North America was right to say it would cost 1,000 existing union jobs and 10,000 projected construction jobs, and  he was skeptical about the veracity of Biden administration vague promises that those laid off would be trained for and given “green jobs,” such as build solar panels. 

In addition to those direct pipeline development jobs lost and the impact upon their families, there will doubtless be a significant economic “ripple effect” causing further job losses in related goods and service industries, stores, and businesses in the towns of those who lost jobs, and lost revenues to the impacted states and local governments and school systems. 

Inasmuch as the President quickly signed 30 executive orders in his first three days of holding office, to reject or block the progress made by the Trump Administration without examination, the question logically arises as to whether he even knew what the impact would be on jobs and families.  Were they just placed by his advisors in front of him to sign without presenting him with a complete discussion of the issues and impacts?  Time will tell… and we hope at not too great a cost to our Nation.