The latest legal setback for the Keystone XL pipeline could have broader implications for the nation as a whole if environmentalists are successful in putting a halt to a project expected to create thousands of jobs.
Earlier this week, Federal Judge Brian Morris revoked a nationwide water crossings permit that TC Energy, the company building the pipeline, needs to cross a series of rivers and streams between North Dakota and Nebraska.
Although the ruling doesn’t immediately shutter the project, it creates a logistical nightmare by forcing the U.S. Army Corps of Engineers to redo an environmental assessment that Morris said failed to adequately consider the pipeline’s effect on endangered species. TC Energy needs the water crossings permit for future construction on the 1,200-mile route.
“It’s always going to be something,” said Ben Lieberman, a senior fellow with the Competitive Enterprise Institute. “A lot of things have to go right in order for a project to get a green light, and only one thing has to go wrong to stop it. Opponents of these projects have a great many bites of the apple and a number of occasions, administratively or through the courts, to slow things down or stop them.”
With the coronavirus-afflicted country reeling from staggering job losses and a national unemployment rate that could hit double-digits, pipelines should be considered among the infrastructure projects that can jump-start the economy, Liberman added.
Dan Kish, a senior fellow with the Institute for Energy Research, called Keystone “the most-studied, most-litigated and most advanced pipeline of its kind.”
“The judge’s decision, which is also liable to affect other job-creating projects throughout the U.S., appears to be nothing less than economic sabotage at a time of national emergency,” Kish said.
A study from the Perryman Group estimated that, over the long term, the Keystone Pipeline could create upwards of 250,000 spin-off jobs. Estimates on the number of shorter-term construction jobs range from 2,500 to 9,000.
The Trans-Alaska Pipeline, which created more than 21,000 construction jobs at its peak, helped grow Alaska’s energy industry after oil companies increased investments in the state as a result of the pipeline.
Experts have pointed out that the Keystone pipeline will help the Gulf states, which will need workers at the end of the pipeline.
Also, pipelines like Pennsylvania’s Mariner East 2 that delivers natural gas liquids from the Marcellus and Utica shale fields could hook into Keystone, which would benefit those states both in terms of jobs and investments in energy sectors.
Officials from both parties and the White House have called for infrastructure projects to be part of the country’s economic recovery from the COVID-19 pandemic. A spokesman for Grow America’s Infrastructure Now, a coalition of businesses, trade associations, and labor groups, said Morris’ ruling could imperil energy projects as a whole.
“Keystone XL was permitted after years of careful review and received the necessary approval from both the U.S. Army Corps and State Department,” said spokesman Craig Stevens. “But the pipeline’s decade-long permitting battle has energy developers thinking twice before investing in new energy infrastructure projects.
“Infrastructure development, like Keystone XL, requires regulatory certainty and a straightforward permitting process that ensures these investments, which cost hundreds of millions of dollars, are able to proceed with construction and safely operate once completed.”
It’s likely this is what the environmental groups who cheered Morris’ ruling had in mind.
“[The] ruling sends a clear signal nationwide that people and the planet must come before profits for polluting corporations,” said a spokesperson for Friends of the Earth.
“Whether they like it or not, the Corps cannot skirt foundational environmental laws,” the Natural Resources Defense Council added.
“[The] ruling confirms, once again, that there’s just no getting around the fact that Keystone XL would devastate communities, wildlife, and clean drinking water,” according to the Sierra Club.
The Keystone XL pipeline was commissioned in 2010 to bring up to 830,000 barrels of oil per day from Alberta, Canada, to Nebraska where it will connect with TC Energy facilities already in place for transport to Gulf Coast refiners.
The company, which just announced a $1 billion investment from the government of Alberta, Canada, expects the pipeline to begin operations in 2023.
