Just as the Obama administration exhausted its arsenal of stall tactics and seemed resigned to approving construction of the Keystone XL pipeline, Nebraska threw one final roadblock in the way of this job-creating project. Lancaster County Judge Stephanie Stacy overturned the law that allowed Gov. Dave Heineman to give formal approval to Keystone, and the fate of the pipeline now rests in the hands of the state’s Public Service Commission. The commission has no reason to further delay the project, and should act quickly to deliver jobs to Americans eager to pick up a shovel.
Keystone XL, which when completed will connect the oil reserves of Alberta, Canada to refineries in Texas, is to be built in two stages. The southern half, spanning from Kansas through Texas, is complete, but unfounded environmental concerns have held the pipeline’s northern half hostage. Fortunately, a recently released and highly anticipated State Department study confirmed what many of us have long known to be true: the rewards of constructing the northern half of the pipeline seriously outweigh the negligible risks.
The comprehensive environmental study examined the pipeline project in a variety of contexts and found that most of the environmental lobby’s fears–from oil leaks to the pipeline’s effect on climate change — were unfounded. In fact, the United States’ decision to build or not build the pipeline will have little to no effect on the amount of greenhouse gases created by the Albertan oil reserves, which the Keystone XL project would link to American refineries.
If America is unable or unwilling to build the pipeline, the State study anticipates that the Albertan oil will be shipped by rail, creating more serious economic and environmental problems. Most of the oil would be sent to Canada’s ports on the Pacific, from which it will be shipped to China, the world’s worst carbon polluter and a chief economic rival of the U.S. The study found that the emissions costs of shipping the oil by diesel-fueled locomotive and tanker could be up to 42 percent higher than shipping it by pipeline.
The report also swept away concerns about the pipeline’s potential to impact the Ogallala Aquifier, the massive water table that supplies fresh water to 82 percent of the High Plains region. Green activists had warned farmers and ranchers that a pipeline leak could ruin their water supply, but the State Department found that the Aquifier’s geographic characteristics would work naturally to limit both the spread and impact of any spill.
The State Department’s study did not only dispel some negative myths about Keystone, it also reaffirmed the that the project will be a boon to the American economy. The pipeline will create 42,000 direct and indirect jobs over its two-year construction period-and contribute $3.4 billion to the economy. Although many of these jobs would be temporary, they would provide opportunities in the blue-collar construction sector for thousands of Americans, taking out-of-work Americans off government assistance and reintroducing them to the workforce.
The pipeline will also carry more direct benefits, in the form of 830,000 barrels of oil per day, ticketed for domestic refineries. By increasing global supply and reducing shipping costs, the oil from Keystone XL will reduce the prices of fuel and home heating for American consumers.
Keystone’s impact will be felt at the local level, too. State and local governments in the Plains region stand to reap over $5 billion in revenue (mostly from property and excise taxes) over the pipeline’s lifetime. That money will allow municipalities to spend more on education and infrastructure, without raising taxes for homeowners.
This isn’t the first time Nebraska has been the state standing in the way of Keystone XL. Two years ago, the state’s Sandhills region became a convenient poster child for the environmental lobby, which sought to cancel the entire project because the pipeline would pass through this area used for ranching. Gov. Heineman resolved this manufactured crisis by approving an alternate path for the pipeline. Now, the state’s Public Service Commission must act quickly, and put pressure on the White House by removing the final obstacle from Keystone’s path.
Jason Stverak is president of the Franklin Center for Government and Public Integrity.