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A blow to Keystone XL Clinton gives up waiting for Obama to deliver final ruling on pipeline, arguing project a distraction to tackling climate change GARY PARK For Petroleum News
When she was U.S. secretary of State through most of the Keystone XL review by her department, Hillary Clinton said she was favorably inclined to endorse the project in the name of energy security over opposition to importing production from Canada’s oil sands.
She said at the time that although oil sands bitumen might constitute “dirty oil,” it was a vital part of a “very hard balancing act” between importing crude from Venezuela, Nigeria, Libya or the Middle East and the pursuit of new clean energy technologies.
Five years later she has made a complete turnaround, which, regardless of whether President Barack Obama issues a presidential permit for Keystone XL, may have pounded a final nail in the plan to ship about 700,000 barrels per day of crude bitumen from Alberta and 100,000 bpd from the North Dakota Bakken to refineries on the Texas Gulf Coast.
Some observers believe Obama, as a diplomatic gesture, will delay his final verdict until after the Canadian election on Oct. 19; others are counting on him deliver a death sentence at any time.
Clinton, in a tight race to win the Democratic Party presidential nomination, said in mid-July she did not want to second-guess Obama on the file.
Town-hall verdict For reasons many think are designed to win over environmentalists and wealthy Democratic donors who have invested heavily in lobbying the Obama administration to turn down Keystone XL she delivered her verdict on Keystone XL at a town-hall meeting in Iowa on Sept. 22.
“I oppose it,” Clinton declared. “I oppose it because I don’t think it’s in the best interest of what we need to combat climate change.”
She argued the prolonged debate over the pipeline is a distraction from efforts to tackle climate change.
Clinton appeared to target Canadian oil with a tweet: “Time to invest in a clean energy future ... not build a pipeline to carry our continent’s dirtiest fuel across the U.S.”
She later told the Des Moines Register that she had told the White House a few weeks ago that she could not remain silent much longer.
“Make no mistake: today is clear proof that social movements move policies,” said 350.org, a Rockefeller-funded organization that has played a key role in making Keystone XL a national issue.
“Thanks to thousands of dedicated activists around the country who spent years putting their bodies on the line to protect our climate, we’ve taken a top-tier presidential candidate’s ‘inclination to approve’ Keystone XL, and turned it into yet another call for rejection,” the activity group said in a statement.
Interest groups credited Ohio Gov. John Kasich, one of the array of Republican candidates for president, quickly answered his own question on “why” Clinton has taken her stand.
“Because she runs a campaign where she appears to serve interest groups,” he said.
Of the others in the Republican race, Jeb Bush has frequently pledged to approve the pipeline if he enters the White House, partly to improve what he calls battered relations with Canada.
Canadian Prime Minister Stephen Harper, who once described approval of the pipeline by Obama as a “no brainer” and insisted he would “not take ‘No’ for an answer,” carefully sidestepped the latest development.
“This is not a debate between Canada and the U.S.,” said Harper’s campaign spokesman Stephen Lecce. “We know the American people support the project. We will not engage in presidential primary debates.”
Canadian politics But what Clinton has done indirectly is force pipeline politics into the Canadian election campaign, where Harper has been an unwavering backer of the major project, Liberal leader Justin Trudeau has shifted his position before endorsing Keystone XL, while New Democratic Party leader Thomas Mulcair has flatly rejected the project.
The Canadian Association of Petroleum Producers said it remains solidly behind Keystone XL and its job-creation and economic-growth potential.
Greg Stringham, marketing vice president of CPP, told the Globe and Mail that over the past six years the pipeline has been vetted twice by the U.S. State Department and received passing grades, as part of an “extensive regulatory and environmental review that made it clear the project will cause no undue environmental impacts, including no substantive change in greenhouse gas emissions.”
TransCanada noted that a recent American Petroleum Institute poll showed 68 percent of Americans support Keystone XL and 67 percent said the failure to approve the application has hurt the U.S. economy.
“The U.S. imports millions of barrels of crude every day, so where do the Americans want their oil to come from?” asked a TransCanada spokesman.
An Enbridge spokesman said his company will continue to “focus on ensuring governments understand the fundamentals so they can best adapt to the changing needs and requirements of the industry.”
“Do they want it from Iran and Venezuela where American values of freedom and democracy are not shared? Or do they want Canadian and American crude oil transported through Keystone XL? We have always believed the answer is clear,” he said.
TransCanada on Plan B Robert Nark, an energy analyst with 3Macs, said the “line in the sand” for Keystone XL was crossed long ago because of the stalling in the Obama administration, which finally forced TransCanada to move to its Plan B - the Energy East project.
Meanwhile, the volumes of Canadian crude being refined on the Gulf Coast has tripled since 2008 when TransCanada first announced Keystone XL by using rail and more circuitous pipeline routes.
“We’re able to move the amount we’re generating out of the oil sands today,” said Michal Moore, an expert on energy and environmental policy at the University of Calgary’s School of Public Policy.
“We’re doing fine,” he said. “It’s the future capacity that’s an issue.”
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