Obama ‘out of excuses’ for delaying Keystone, GOP chairman says

It’s time for President Obama to stop dragging his feet and approve the Keystone XL oil sands pipeline, Rep. Ed Royce (R-Calif.) said Thursday.

Royce, the chairman of the House Foreign Affairs Committee, called for approval of the pipeline when the State Department’s 45-day comment period on its March 1 environmental analysis closes.

“After that the administration should be out of excuses to delay approving this pipeline. They must not come up with new excuses,” he said at a hearing.

The panel’s Keystone-focused energy hearing Thursday provided project backers fresh chances to put political pressure on Obama to approve Keystone, which would bring oil from Canadian oil sands projects to Gulf Coast refineries.

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Backers of the project were buoyed by State’s March 1 draft analysis, which did not raise major environmental red flags about TransCanada Corp.’s proposed project.

In particular, it found that approving or denying Keystone would not substantially affect the rate of oil sands development. Environmentalists, in contrast, have called the project a catalyst for carbon-intensive oil sands projects.

“The State Department’s draft supplemental environmental impact statement could not assert that there was an environmental reason to not approve the pipeline,” Royce said at the hearing of the Western Hemisphere subcommittee.

“The only rational move for the administration to make is to go ahead and approve the pipeline,” he said, arguing it would boost energy security and create jobs.

The hearing, which included multiple pro-pipeline witnesses, is part of a broader GOP effort to pressure the White House to back the project, which faces heavy resistance from climate change advocates.

The House GOP budget unveiled this week would require approval. Rep. Lee Terry (R-Neb.) is also pushing legislation that would enable Congress to greenlight Keystone.

“I have zero confidence that the State Department will act in a timely fashion,” said Terry, who offered testimony to the committee Thursday.

The president told House GOP lawmakers Wednesday that a decision would be coming soon, according to several members who attended the wide-ranging meeting between Obama and the GOP conference.

Obama also said that the project would not provide as many U.S. jobs as backers claim, but would not create the environmental harms that opponents allege, according to several lawmakers present.

That view was echoed by one of the witnesses Thursday who cautiously endorsed the project.

“The Keystone XL pipeline would not deliver the massive economic and security gains that some have claimed, but allowing the pipeline to proceed would not be the climate catastrophe that many have predicted either,” said Michael Levi, who heads the energy security and climate change program at the Council on Foreign Relations.

“Ultimately, allowing the pipeline to proceed would likely yield benefits that outweigh the associated costs,” he said, summarizing his analysis of the project, available here.

Witnesses from the American Petroleum Institute and the industry-backed Institute for Energy Research offered more full-throated endorsements of Keystone.

Royce, echoing other Keystone advocates, cited industry-backed analysis that claims building Keystone would create well over 100,000 jobs. Some GOP backers have claimed over 200,000 jobs.

But that’s far above what the State Department review concluded.

“Including direct, indirect, and induced effects, the proposed Project would potentially support approximately 42,100 average annual jobs across the United States over a 1- to 2- year construction period (of which, approximately 3,900 would be directly employed in construction activities),” the State Department analysis found.

Once the pipeline is built, operation would support 35 permanent jobs and 15 temporary jobs, mostly for routine inspections, maintenance and repairs, the study estimates.

Critics of the project, for their part, are stepping up their opposition.

An environmental group’s study released Thursday said 60 percent of the gasoline produced at refineries that would handle most of Keystone's crude is already exported.

The Oil Change International analysis is based on U.S. Census Bureau and Energy Information Administration data on Texas Gulf Coast refineries and ports, according to the group, which opposes the project.

It suggested Keystone would facilitate a bump in oil exports in the long-term.

“The changing dynamics of the U.S. oil market strongly suggest that exports would only rise over the lifetime of the pipeline. U.S. production is rising but consumption is declining and the industry will continue to maximize its profits through exports,” a summary of the study states.

— Zack Colman contributed