Savage two-month lobbying battle over Keystone oil pipeline starts now

The 60-day clock for a federal decision on the Keystone XL pipeline started by the payroll tax deal will touch off a frenzied lobbying and PR battle as environmentalists and the oil industry seek to sway the decision.

The Senate voted overwhelmingly Saturday for legislation that requires the State Department to issue a permit for the pipeline to bring Canadian oil sands to Gulf Coast refineries, unless President Obama determines that it’s not in the national interest.

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The House is expected to follow suit next week, ensuring an all-out public and behind-the-scenes effort by business groups, environmentalists and other interests on both sides of the issue.

The pipeline has already been at the center of an intense lobbying effort involving at least 42 lobbying firms, associations and companies, which The Hill's Rachel Leven described here.

Jack Gerard, president of the powerful American Petroleum Institute, told E2 Saturday that the group is planning more ads and will continue orchestrate pressure on decision-makers from the “grassroots” network that backs the project.

“The president will hear from thousands of Americans before he makes this decision, perhaps hundreds of thousands,” he said.

Gerard and other industry officials call the pipeline vital. “We are continuing to aggressively advocate for the pipeline in our national security interest as well as our energy security interest,” he said.

Environmental groups oppose the project due to greenhouse gas emissions and forest damage from the energy-intensive oil sands projects, potential spills along the route and other issues.

The payroll tax bill upends the Obama administration’s decision, announced in November, to punt on making a final call on politically explosive project until after the 2012 elections by extending review into 2013.

That delay followed an aggressive campaign by green groups – activists who must quickly get their campaign back into high gear.

“We will notify our supporters today to dust off their signs and get ready to bring the message straight to the president over the next two months,” said Daniel Kessler, a spokesman for Tar Sands Action, on Saturday.

Tar Sands Action organized major White House demonstrations against the pipeline in August and November.

Friends of the Earth similarly vowed Saturday to “campaign aggressively” over the next two months.

The Obama administration and several Democrats said Friday night that inclusion of the pipeline provision is a hollow victory for Republicans. 

“By insisting on an expedited review of the Keystone pipeline that will not allow for sufficient consideration of public health and safety concerns, Republicans have effectively killed the project,” said Senate Environment and Public Works Committee Chairwoman Barbara Boxer (D-Calif.).

Administration officials Friday pointed to this week's State Department warning that if the review is compressed into the next 60 days, they’ll have little choice but to reject the pipeline permit.

But the measure nonetheless forces action before the 2012 elections on a project that creates a political quandary for the White House by splitting key parts of President Obama’s base. Environmentalists despise it while a number of major unions back the project.

And advocates of the project are pushing back against the White House and State Department claims about the effect of the 60-day permit timeline. 

Sen. Richard Lugar (R-Ind.), the author of the pipeline language, called State’s claims “blatantly misleading.”

“The ostensible reason that the State Department delayed the permit – to reroute the pipeline around the Nebraska Sand Hills region – is not subject to the 60 day limit,” his office said in a statement earlier this week. 

His office said the permit issued under the plan “would allow ample time with no set schedule for the pipeline section in Nebraska to be rerouted according to Nebraska’s state law,” while construction could commence elsewhere.

More broadly, Republicans on Saturday previewed attacks against Obama that would occur if he rejects the project.

They hope to translate the provision into a political victory in an election season dominated by the weak economy.

“And since I still haven’t heard a good reason from the White House as to why they would block it, I’m hopeful the President will do the right thing—and get this crucial project underway. The only thing standing between thousands of American workers, and the good jobs this project will provide, is President Obama,” Senate Minority Leader Mitch McConnell (R-Ky.) said Saturday.