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Fuel Freedom Staff

Democrats block Keystone XL bill in Senate

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As expected, Senate Democrats prevented a bill authorizing construction of TransCanada’s Keystone XL pipeline from advancing in the Senate.

The fate of the pipeline still remains with the State Department, because the pipeline would cross from Canada through the United States.

President Obama already has made his feelings known, saying through a spokesman that he would veto any bill that emerged from Congress.

According to media reports, Senate Majority Leader Mitch McConnell moved to end debate on the bill, a version of which had already cleared the Republican-controlled House. But Republicans could only muster 53 votes for cloture, or an end to the debate, on two separate roll calls. Under parliamentary rules, 60 votes are needed for cloture.

The New York Times reported: “The move ensures that senators will continue to debate the bill — most likely for another week — before Republicans again try to bring the measure up for a final vote.”

The GOP had no doubt hoped for more Democrats. As Politico reported:

The legislation … on Monday lost a vote from one of its longtime backers, Sen. Jon Tester (D-Mont.) — now a member of party leadership as chief of the Democratic Senatorial Campaign Committee — but picked up a vote from Sen. Michael Bennet (D-Colo.), the former DSCC chairman who has not formally signed onto the pipeline bill.

Two other Democrats who have backed stripping Obama’s power to decide on a Keystone permit, Sens. Claire McCaskill and Mark Warner, missed the Monday vote.

“I’d like to see us decide Keystone and move on,” Sen. Heidi Heitkamp, one of the pro-Keystone Democrats who voted with the GOP to cut off debate, told reporters.

Keystone’s backers initially expected the pipeline votes would end this week. But Democratic anger over the majority leader’s move to close off the debate on their amendments last week has made the pipeline bill a power struggle, with Democrats pushing McConnell to continue the freewheeling energy debate on the floor that has delved into topics ranging from climate change to eminent domain.

 

Fuel Freedom Staff

Obama, Congress draw battle lines on Keystone XL

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On the same day two Republican senators introduced a bill authorizing construction of the Keystone XL oil-pipeline extension, the White House said President Obama would veto such a bill if it reached his desk.

“If this bill passes this Congress, the president wouldn’t sign it,” White House press secretary Josh Earnest said Tuesday.

Republicans took over control of the Senate as the 114th Congress was sworn in Tuesday. The GOP, and some Democrats, have supported the pipeline project for much of the past six years that it’s been in limbo, and the party wasted no time in sponsoring a bill to pressure the Obama administration to approve it: Sens. Joe Manchin, Democrat of West Virginia, and John Hoeven, Republican of North Dakota, introduced the Senate bill, and a committee hearing is scheduled for Wednesday.

The House is expected to begin deliberations on its own Keystone bill on Friday.

The last time the House passed an authorization, in November, it was blocked from proceeding by Senate Democrats. But with fewer numbers, the measure has a greater chance of passing this time.

However, the Senate needs 67 votes — two-thirds — to override a presidential veto. As BusinessWeek reported, Hoeven says he has 63 votes in favor of approval, four shy of a veto-proof majority.

Reaction to the White House announcement ran the gamut. House Speaker John Boehner, Republican of Ohio, said in a statement:

On a bipartisan basis, the American people overwhelmingly support building the Keystone XL pipeline. After years of manufacturing every possible excuse, today President Obama was finally straight with them about where he truly stands. His answer is no to more American infrastructure, no to more American energy, and no to more American jobs.

By contrast, environmental activist Bill McKibben, writing in The Guardian, praised the effort that led to the veto threat, considering the pipeline once was considered a shoo-in for approval.

Keystone’s not dead yet – feckless Democrats in the Congress could make some kind of deal later this month or later this year, and the president could still yield down the road to the endlessly corrupt State Department bureaucracy that continues to push the pipeline – but it’s pretty amazing to see what happens when people organize.

The State Department has concluded that the 1,179-mile pipeline extension, which would carry oil-sands crude from western Canada to the Gulf of Mexico, wouldn’t significantly add to carbon emissions, but the project would create only 35 permanent U.S. jobs.

Regardless of what happens between Congress and Obama, the final decision on Keystone rests with the State Department, which reports to the president. State has responsibility because the pipeline, to be built by TransCanada Corp., would cross the Canada-U.S. border.

The Post added:

“I think the president has been pretty clear that he does not think that circumventing a well-established process for evaluating these projects is … the right thing for Congress to do,” Earnest said.

Obama rejected a Canadian firm’s application to build the pipeline in 2012.

At a year-end news conference in December, Obama sought to downplay the benefits of the pipeline. He said the benefits for U.S. citizens and workers from the pipeline would be “nominal.”

“I think that there’s been this tendency to really hype this thing as some magic formula to what ails the U.S. economy,” Obama said.

Fuel Freedom Staff

Does Keystone XL even make economic sense?

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A story in The Los Angeles Times asks a pertinent question: With the price of oil low (by recent historical standards) and continuing to fall, do the economics of the proposed Keystone XL pipeline even make sense anymore?

After all, it’s expensive to extract the kind of tar-sands oil in western Canada that would flow through the pipeline, and the price of oil has to be a certain level for the process to be profitable.

That’s why even pro-business people who are in favor of oil production are questioning whether the pipeline extension — which would be built from Canada to Nebraska, linking up with an existing line to the Gulf of Mexico — would reward investors.

With the GOP about to take control of both houses of Congress, backers of the pipeline say they are close to having a veto-proof majority for a bill that would order the Obama administration to give the project the federal permit required for pipelines that cross a U.S. border.

But “the political debate is not paralleled by the realities” in the market, said Sandy Fielden, director of energy analytics at Texas-based RBN Energy. “The economics of this project are becoming increasingly borderline.”

President Obama could use his veto pen to scuttle the legislation, but the State Department will ultimately have the final say on whether the pipeline gets approved. TransCanada Corp. still wants to build it, and GOP leadership still wants to get it done as well, economics or no.

TransCanada says investors still want it, because they’re thinking long-term and aren’t concerned about a short-term glut of oil that has suppressed prices.

“We sign binding, long-term commercial agreements with our customers so they can reserve space to deliver the crude oil they need to their customers,” Mark Cooper, a spokesman for TransCanada Corp., which would own the pipeline, wrote in an email.

The oil shippers investing in the pipeline, Cooper wrote, “have a good understanding of what the market needs over time. They do not make decisions based on short-term views or changes in commodity prices.”