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President Trump Approves Construction of Keystone XL Pipeline from Alberta to Nebraska

Following through on a January executive action, President Trump announced Friday that he was approving the oil pipeline that his predecessor had rejected over a year ago. Oil is already flowing from Steele City, Nebraska to Gulf Coast refineries.
March 27, 2017, 8am PDT | Irvin Dawid
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On March 24, President Trump's State Department "signed and issued a Presidential Permit to construct the Keystone XL Pipeline," announced the Calgary-based pipeline builder, TransCanada Corporation. As posted in January upon the president's signing a memorandum giving conditional approval to the Alberta to Nebraska pipeline, the pipeline will carry oil sands crude from Alberta and Bakken oil from North Dakota to the Gulf Coast refineries.

As readers who have followed the nine-year Keystone XL saga (see the Associated Press timeline, which begins in March 2008 with the original Keystone pipeline approval and September 2008 filing by TransCanada for a new Keystone XL routewill recall, former President Obama rejected the trans-national pipeline on Nov. 6, 2015.

Oil has been flowing through the southern, 487-mile leg of the pipeline (Phase III) from Cushing, Okla. to the Port Arthur, Texas region since January 2014. Phase II, from Steele City to Cushing, began operation in 2011. All that was missing was that Presidential Permit to enable a new (hence the "XL") trans-national crossing that required a Republican president to succeed President Obama.

Keystone Pipeline Route

Courtesy of Wikipedia: Keystone Pipeline Route, Phases 1 through 4.

However, the saga doesn't end with Friday's approval. The 1,179-mile Phase IV "shortcut" running from the oil sands of Alberta, Canada, through Montana to Steele City, Nebraska still faces hurdles before it can transport 830,000 barrels a day of oil sands crude from Alberta and Bakken crude from North Dakota, reports Clifford KraussThe New York Times' national energy business correspondent.

It needs the approval of the Nebraska Public Service Commission and local landowners who are concerned about their water and land rights. Protests are likely since the project has become an important symbol for the environmental movement, with the Canadian oil sands among the most carbon-intensive oil supplies

Krauss describes the "mixed-blessing" reaction by Prime Minister Justin Trudeau: good for the Canadian economy, but a likely setback for meeting his climate targets. [See related post this month on Trudeau's award from the energy industry.]

What happened to U.S.-manufactured steel for the pipeline?

Remember President Trump's insistence, solidified in a presidential memorandum on Jan. 24, that pipelines that run through the United States be manufactured domestically?

"We are -- and I am -- very insistent that if we're going to build pipelines in the United States, the pipe should be made in the United States," Trump said on Jan. 24. []. Krauss writes that "the White House has since suggested that the Keystone project would not be subjected to those rules because it is not a new project."

However, the Sierra Club provides a different explanation for Trump's reversal: "According to reports, TransCanada's threat to continue [it's $15 billion] NAFTA suit contributed to the White House decision to renege on Trump's promise that the pipeline would be made with U.S. steel." An hour after President Trump made his announcement, TransCanada dropped its suit, the Club reports.

Notwithstanding President Trump's announcement in the White House on Friday that "[i]t’s a great day for American jobs and a historic moment for North American and energy independence," don't expect President Trump to appear at any Ohio steel plants announcing new jobs.

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Published on Friday, March 24, 2017 in The New York Times - Energy & Environment
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