Two of the world's wealthiest men – who might not always be on exactly the same political page – have joined the battle over the Keystone XL pipeline, and both have landed on the side of the project.
Former New York Mayor Michael Bloomberg is urging politicians to put politics aside and look at the project as a way to make progress on climate change. And even though he has a vested interest in crude-by-rail through the ownership of BNSF Railway, Berkshire-Hathaway CEO and Obama supporter Warren Buffett is challenging the administration's stand on the project and stresses the importance of U.S.-Canadian relations.
The Bloomberg initiative
Canada’s ambassador to the United States Gary Doer said he remains hopeful that “people are going to work towards getting broader proposals” to end bilateral wrangling over Keystone XL.
He said that possibility is reflected in a proposal floated by Michael Bloomberg, former mayor of New York and now a United Nations special envoy on climate change.
While emphasizing he did not want to become embroiled in U.S. domestic political issues, Doer said there is also talk about attaching an XL provision to a major infrastructure or budget bill from Congress that President Barack Obama would have greater difficulty vetoing.
The Bloomberg initiative was laid out in a public letter issued Feb. 25 titled a “Keystone solution for all, including Canada,” in which he said Democrats and Republicans are talking “past each other, because each cares more about gaining a political advantage than a policy achievement.”
“Yet a path exists for (Obama) to transcend these differences and allow both sides to declare victory,” Bloomberg said.
Contrary to conventional wisdom, he said the pipeline “could open up a rare opportunity to achieve progress on climate change” by setting aside feuding between Democrats and Republicans if the White House seized the chance to “negotiate a broader, climate-friendly deal that far more than offsets the potential impact of the pipeline.”
Bloomberg said the timing is right for talks, with the Canadian government “under pressure to take a more aggressive approach to climate change in the run-up to the United Nations conference in Paris this December.”
He urged Obama and Prime Minister Stephen Harper to “engage in talks that can lead to a (climate change) agreement that will benefit both of our nations’ economies and environments.”
Bloomberg said the “endless partisan debate (over the pipeline) has gotten us nowhere,” arguing that the gridlock that defines Washington should not curtail diplomacy, nor stand in the way of progress on climate change.
Buffett lends a voice
XL gained a strong ally March 2 when billionaire investor Warren Buffett, a leading contributor to Obama campaigns, challenged the administration’s handling of the pipeline file.
“I think that we have enormous interest in working with Canada, as they have in working with us,” he said in an interview with CNBC. “The oil is going to get sold. If we make it more difficult for them, who knows how they’ll feel about making things more difficult for us some day.”
Because of Buffett’s major investments in railroads it had been thought that he would favor rejection of XL.
Instead, he argued that Canada has been a “terrific partner over the decades” in developing North America’s valuable oil resource.
“For us to thumb our nose at them ... is not what I would do,” he said.
The pro-XL movement also gained support from the Washington Post, whose “Fact Checker” feature took issue with Obama’s repeated claim that the pipeline would only serve to export Canadian crude.
The newspaper gave Obama its lowest truth-telling score - “Four Pinnochios” - in noting that the pipeline would also carry Bakken crude from North Dakota and Montana to Gulf Coast refineries.
As well, it said Obama is at odds with State Department review, suggesting that report has “clearly” not been read by the White House. If the president does not agree with those findings “he should begin to make the case why it is wrong, rather than assert the opposite, without any factual basis,” The Post said.
Doer saluted the notion of a Canada-U.S. agreement, noting that Canada has repeatedly offered to regulate oil and natural gas in partnership with the U.S. the way it has done on automobile emissions.
But he also cautioned that XL would likely encounter new court challenges if the pipeline regulatory process becomes part of Canada-U.S. deal-making.
“On the issue of having a quid-pro-quo for Keystone, we think that’s against the national-determination rules,” Doer said, referring to the U.S. regulatory process for pipelines that allowed Obama to veto the XL bill.
Meanwhile, TransCanada has again injected itself into the U.S. regulatory process in a letter challenging some of Obama’s latest talking points on the pipeline.
The company quoted findings by the consulting firm of IHS Energy that said the bulk, if not all crude oil in the pipeline would be refined in the U.S., with at least 70 percent of the finished products remaining in the U.S.
Obama has often claimed XL would do little for the U.S. economy, but would merely be used as a conduit across the U.S. for exporting Canadian crude beyond North America.
Obama comments
In his first public comments since vetoing the XL bill, Obama reiterated that position.
“I’ve already said I’m happy to look at increasing pipeline production for U.S. oil,” he said in an interview with WDAY television in Fargo, North Dakota. “But Keystone is for Canadian oil, sending it down to the Gulf. It bypasses the U.S.”
White House press secretary Josh Earnest told reporters Feb. 24 that Obama’s veto of legislation to fast-track XL was strictly about the legislation and not the project.
Earnest said it is “certainly possible” that Obama could eventually approve the pipeline once the State Department completes its review and makes a recommendation.
