EDITORIAL: No More Keystone Excuses
The Wall Street Journal
March 3, 2013
President Obama’s spokesmen claim that cutting $43 billion out of a $3.8 trillion federal budget this year will be an economic disaster, though investors seem unconcerned. But if Mr. Obama wants shovel-ready spending stimulus today, why doesn’t he finally approve the Keystone XL pipeline? It won’t cost taxpayers a dime.
On Friday the pipeline from Canada through six U.S. states to the Gulf Coast received another boost when a State Department study found there would be no significant damage to the environment. This follows Nebraska Governor Dave Heineman’s endorsement in January of a revised pipeline route that now skirts around the Sand Hills region of his state. All of which means the White House has run out of excuses to keep delaying approval of a $5.3 billion private investment that would provide some 16,000 direct jobs and more downstream.
The State Department study, the fourth such U.S. review in four years, found once again that the pipeline wouldn’t make much difference to climate change. The Alberta tar sands are the world’s third largest reservoir of oil, and Canada is going to develop them one way or another. …
If the Alberta oil doesn’t flow south to America via the Keystone XL, it will flow west to China via other pipelines or rail. It will also flow to the Gulf Coast by other means, including pipelines and rail to East Coast ports, and then via tankers in the Atlantic and around Florida. Keystone XL will have a smaller “carbon footprint” than these alternatives. …
Thus the issue is not whether the oil will flow but how much Americans will benefit. A rule of thumb is that for every dollar of imported foreign oil, North America receives about 10 cents of the economic benefit. The Venezuelans, Saudis and others get the rest. The benefit from oil produced in North America is roughly 80-90 cents of each $1. This includes the cost of producing and transporting the oil, and the ancillary jobs and sales that flow from it. The Keystone XL has also reserved space for about 250,000 barrels a day of oil produced in the U.S., which means a new and environmentally safer outlet for oil from the booming Bakken fields of North Dakota. …
Read the full editorial online here.