Hurry Up on Job-Creating, Tax-Generating Keystone XL Pipeline, TransCanada Exec Tells Congress

By Susan Jones | April 11, 2013 | 10:56am EDT

TransCanada is now building a southern section of the Keystone XL pipeline. This segment does not cross an international border and therefore does not require U.S. government approval. (AP Photo)

( - The man in charge of TransCanada's pipeline business says it's time to "proceed expeditiously"with the Keystone XL Pipeline.

"The project will reduce the United States' reliance on higher-priced foreign oil and replace it with stable, secure supplies from both Canada and the U.S. It will create high-paying American jobs, inject billions of dollars into the U.S. economy, and pay millions in taxes for decades to come. This project is needed, the benefits are clear, and time is of the essence to move forward," Alex Pourbaix told a House Energy and Commerce subcommittee on Wednesday.

Because the pipeline crosses the U.S.-Canada border, the project requires U.S. government permission. Since 2008, when TransCanada first applied for a presidential permit, the State Department has reviewed and re-reviewed all aspects of the pipeline.

But President Obama -- apparently not wanting to anger his environmentalist supporters before the election -- denied the permit last year. Seizing on a deadline imposed by Republicans, the Obama administration said it needed more time to determine if the project was in the national interest.

TransCanada has re-filed its application for the northern leg of the pipeline, but as Pourbaix told the committee on Wednesday, "it appears that a decision on the pending Presidential Permit application is many more months down the road."

Pourbaix praised Republican legislation that would remove the requirement for a presidential permit and clear the way for construction to begin, and he thanked the committee for holding a hearing "which serves to call attention to the need for a prompt decision on this application..."

In addition to energy security, Pourbaix listed the "significant economic benefits" the pipeline would bring to the United States, as follows:

-- Keystone XL Pipeline construction requires no government subsidy or expenditures; The project is privately funded and financed and is shovel-ready, waiting only for the pending Presidential Permit decision.

-- Construction would contribute approximately $3.4 billion to U.S. GDP.

-- Construction contracts, materials, and support services purchased in the U.S. would total approximately $3.1 billion.

-- Approximately 10,000 construction workers hired for 4- to 8-month seasonal construction periods (approximately 5000-6000 per construction period) would be required to complete the proposed Project. (When expressed as average annual employment, this equates to approximately 3,900 jobs).

-- A total of 42,100 jobs throughout the United States would be supported by construction of the proposed Project. 12,000 would be in the project area states (South Dakota, Nebraska, Kansas, and Montana).

-- Total earnings generated by the project would be approximately $2.053 billion.

-- Effects on minority and low-income populations would generally be small and short term. Risks associated with potential spills would not be disproportionately borne by minority or low-income populations.

-- Total estimated property taxes from the proposed project in the first full year of operation would be about $34.5 million, spread across 31 counties in three states. Other sales, use, and fuel taxes would accrue during two years of construction.

-- Construction camps could generate a total of about $2 million in tax revenues.

Addressing safety concerns, Pourbaix noted that the pipeline system is subject to "comprehensive pipeline safety regulation" overseen by the U.S. Department of Transportation's Pipeline and Hazardous Materials Safety Administration (PHMSA).

"Above and beyond the PHMSA regulations, Keystone has agreed to comply with 57 additional Special Conditions that go beyond the existing PHMSA regulations that have been developed by PHMSA for the Keystone XL Project," he said.

Even the State Department has concluded that "[s]pills associated with the proposed Project that enter the environment are expected to be rare and relatively small."

After four-plus years of "thorough and comprehensive environmental" review," there's no reason for further delay, Pourbaix concluded: "I would suggest that it is time to bring this process to a close and proceed expeditiously to a final approval of the Keystone XL Pipeline."

At his confirmation hearing in January, Secretary of State John Kerry said "it will not be long" before TransCanada's application comes across his desk: "And at that time, I'll make the appropriate judgments about it," he said.

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