On Keystone pipeline, GOP plays Buffett card to counter Dems’ Koch claims

Senior Capitol Hill Democrats battling the Keystone XL oil sands pipeline are casting the project as a sop to the Koch Brothers, billionaire industrialists who pour money into conservative causes.

But Republicans backing Keystone are playing a billionaire card of their own in the fight over the proposed pipeline, which would bring oil sands crude from Alberta to Gulf Coast refineries.

They’re floating the idea that blocking Keystone would benefit Warren Buffett, the famed investor who supports President Obama and his push to raise taxes on the very wealthy.

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At an Energy and Commerce Committee hearing on Keystone Friday, Rep. Ed WhitfieldWayne (Ed) Edward WhitfieldWhy Republicans took aim at an ethics watchdog What Azerbaijan wants from Israel? Overnight Energy: Green group sues Exxon over climate science MORE (R-Ky.) both raised and downplayed the prospect that Keystone’s demise would be Buffett’s gain.

After Rep. Henry Waxman (D-Calif.) again chastised Republicans for refusing to bring in a Koch Industries witness, Whitfield said the major railroad that Buffett owns could be a winner if Keystone dies.

“I might say that we know that the Burlington Northern Santa Fe Railroad has direct routes right into Canada and Alberta, and that if the pipeline is not built that maybe some of that oil will move by rail into the U.S.,” said Whitfield, who heads the Energy and Power Subcommittee.


But he made the comments as a way to argue that neither the Kochs nor Buffett should be brought before the committee in the Keystone fight.

“We have not made any effort to call Warren Buffett to testify at this hearing because even though his company might benefit if the pipeline is not built, we do not think he has a direct financial interest in it,” Whitfield said. “And I really in my view do not view Warren Buffett and the Koch Brothers any different in this situation.”

The State Department’s environmental review of Keystone – a project the Obama administration rejected in January – notes that railroads could accommodate growing Canadian oil production for years if new pipeline capacity isn’t built.

The Republican National Committee’s research director, Joe Pounder, took to Twitter Friday to play the Buffett card.

He linked to a Bloomberg story that noted Burlington Northern is also benefitting as oil production in the Bakken formation “outpaces pipeline growth, boosting petroleum shipments by rail.”

Keystone, in addition to bringing oil sands crude from Alberta to the Gulf Coast, is envisioned as a way to accommodate growing volumes of oil from the Bakken formation in North Dakota and Montana.

Buffett denies any efforts to influence the fate of TransCanada Corp’s proposed Keystone XL line.

He told The Omaha World-Herald last week that he has never talked to Obama, the administration or anyone in Congress about the pipeline.

"I'm not qualified to have an opinion being neither an engineer, a geologist or having any other skill that would give me special qualifications for making a decision," Buffett told the paper.

Similarly the Kochs – whose Kansas-based conglomerate includes U.S. refineries and oil purchasing and exporting operations in Alberta – have for months strongly denied any financial stake in the Keystone pipeline.

“We are not a proposed shipper or customer of oil delivered by this pipeline. We have taken no position on the legislative proposal at issue before Congress and we are not cited in any way in that legislation,” a company official reiterated in January.

But Waxman, the top Democrat on the Energy and Commerce Committee, says unanswered questions remain about the Kochs' interest in Keystone, and at Friday's hearing attacked Republicans for refusing Democratic requests to bring in a witness from the company.

“Why is Koch Industries being placed in a witness protection program? What does the company have to hide and why does the company get special treatment while the American people are left in the dark,” he said.

The dueling Koch and Buffett references drew a lighthearted exchange at Friday’s hearing of the Energy and Power Subcommittee that Whitfield heads.

Rep. Bobby Rush (D-Ill.), the panel’s ranking member, suggested holding a hearing with both Buffett and the Kochs. “That would be a dandy of a hearing,” Rush said.

“That would be. We would get a lot of press,” Whitfield quipped.

The comments about the Buffett and the Kochs on Capitol Hill come as House Republicans are moving legislation that would mandate approval of Keystone.

The House Energy and Commerce Committee is expected to approve legislation as soon as Tuesday that would require a permit for the project, while Senate Republicans are pushing new legislation too.

Obama rejected TransCanada Corp’s permit for Keystone in January, alleging a deadline that Republicans demanded provided too little time to complete review of the project (but the administration also invited TransCanada to reapply).

Environmentalists bitterly oppose Keystone over greenhouse gas emissions and ecological damage from Alberta’s massive oil sands projects, fears of spills along the route and other concerns.

Republicans, backed by major business groups and some unions, are strongly promoting Keystone as a way to boost energy security and create jobs.