Keystone XL for Growth, Jobs, Security

Mark Green
Posted March 24, 2017

With the Trump administration making good on its pledge to expeditiously approve the Keystone XL pipeline, we can look at the project for what it would be – a significant piece of North American energy infrastructure that holds the promise of supporting broad economic growth and strengthening American energy security. API President and CEO Jack Gerard:

“Today’s action to approve the Keystone XL pipeline’s cross-border permit is welcome news and is critical to creating American jobs, growing the economy, and making our nation more energy secure. … Approval of this project is an important step to recognizing the benefits that come from U.S. energy infrastructure. … Moving forward, we strongly urge the individual states, which stand to benefit from the Keystone XL pipeline, to approve this important project.”

Gerard refers to needed approvals from certain states before pipeline construction can start. These decisions should be based on the project’s merits, on the economic and growth benefits it likely will deliver at state and local levels.

In Nebraska, for example, the U.S. State Department estimated that Keystone XL’s construction would generate 4,500 jobs, $149 million in employee earnings and $11.7 million in local tax revenues in the pipeline’s first year of operation. These are benefits to individual workers and their families and to counties and communities along the project’s route. From the Keystone XL statement of North America’s Building Trades Unions:

“[W]e are not only excited, but invigorated and optimistic, over the construction of this critical piece of energy infrastructure. It is refreshing that projects serving the national interest are now gaining Presidential support and expedited timelines to reach a permitting decision. … Further, we are delighted that the men and women who make their livelihoods in the construction industry will no longer suffer the indignity of having their chosen careers demeaned as nothing more than ‘temporary jobs’ by out-of-touch politicians.”

More broadly, the five analyses State conducted for President Obama (used by the Trump team) – which said the pipeline wouldn’t significantly impact climate or the environment – projected that Keystone XL would support more than 42,000 jobs during its construction, generate more than $2 billion in employee earnings and contribute about $3.4 billion to the U.S. economy.

Beyond the numbers, Keystone XL would deepen the United States’ energy partnership with Canada, our No. 1 source of imported crude oil, strengthening a mutually beneficial trading relationship. In addition to the safe, reliable energy the U.S. imports from Canada, there are a lot of U.S. goods going back the other way -- enough so that for every dollar the U.S. spent in 2016 on imports from Canada, more than 90 cents were returned from U.S. exports sold to Canada. The U.S. and its North American neighbors have an opportunity through two-way energy flows, to share in growth and energy security as the three-country market moves closer to self-sufficiency.

The other big point about Keystone XL is what it could portend for the future. As we’ve argued before, Keystone XL – as well as the Dakota Access Pipeline – signals the United States is embracing its new energy reality by moving forward to build a more modern infrastructure – potentially $1.15 trillion in private capital investment that could create more than 1 million jobs. Once a rallying point for an anti-progress, anti-energy agenda, Keystone XL soon may represent a new era of progress on projects with wide public benefits. If the project is built – as increasingly looks likely – it will illustrate that the U.S. can indeed do big things again. The U.S. Chamber’s Tom Donohue:

“We applaud President Trump’s decision to approve the project and prove to the world that America is capable of tackling the major infrastructure improvements necessary for a modern economy. This pipeline, and countless other projects around the nation, will improve America’s energy security, create jobs, and help get the economy back on track.”