Tuesday, February 07, 2012

House E&C Committee Approves Keystone XL Pipeline Bill

Feb 7: The House Energy and Commerce (E&C) Committee held opening statements on February 6, on the markup of H.R. 3548, the North American Energy Access Act [See WIMS 2/6/12], and continued the markup and final vote of 33-20 today. The approval was largely along party-lines where Republicans outnumber Democrats 31-23. A number of Democratic amendments were defeated. The bill will now go to the full House where it is expected to be folded into the House Energy and Infrastructure Jobs Act (H.R.7) [See WIMS 2/1/12] when that legislation comes to the House floor for a vote this month.
    The bill gives the Federal Energy Regulatory Commission authority and oversight over the pipeline's permit and construction. The legislation requires FERC to approve the pipeline's permit within 30 days, with the Final Environmental Impact Statement (FEIS) prepared by the U.S. State Department as the basis for its decision. The legislation gives FERC 30 days to approve a Nebraska re-route after the State's governor has completed necessary environmental review and approved it.
    A Republican release indicates that Republican members touted the pipeline's numerous economic and energy security benefits while some Democrats attempted to distract the debate by suggesting the pipeline would be built to facilitate oil exports. Energy and Power Subcommittee Chairman Ed Whitfield (R-KY) said, "This argument is nothing more than red herring." 

    Whitfield pointed to a
Department of Energy memorandum which he said refutes Democrats' argument that the oil transported by Keystone would be sent to China, concluding Gulf Coast refineries will likely consume additional Canadian oil sands well in excess of what would be provided by the Keystone XL pipeline. It also concludes that exports of Canadian oil sands from Port Arthur, Texas, are unlikely. Republicans said, "To suggest the Keystone XL pipeline would be built to ship oil to China defies both common sense and economic sense. If the goal were to get Canadian oil to Asian markets, it would be far easier to build a much shorter pipeline to the west and ship the oil to China -- a project Canada is considering now that President Obama has further-delayed the pipeline's construction."
    Energy and Commerce Chairman Fred Upton (R-MI) said, "We have been told that the new pipeline is not designed to increase supplies here, but rather to export supplies from the Gulf to other countries, including China. But that doesn't pass the common sense test. The real risk of losing out on this energy comes from not building the pipeline. If the U.S. refuses to allow this project to move forward, then not a single drop will come through Keystone XL to refiners in the Midwest and Gulf Coast. The Canadian government would have little choice, as they have made clear, but to pursue other markets for its growing oil production, including construction of a pipeline to the Pacific coast for export to China."
     Representative Lee Terry (R-NE), author of H.R.3548 said, "The Keystone XL pipeline will greatly enhance America's energy security. With this proposed pipeline our crude imports from Canada could reach 4 million barrels a day by 2020, twice what we currently import from the Persian gulf. Enhancing our energy partnership from Canada will strengthen America's energy future. Each additional drop of oil from Canada offsets a drop of OPEC oil."
    In an opening statement Chairman Upton said, "Some have questioned the widely used estimates that more than 100,000 jobs would be created by the pipeline project, including 20,000 direct jobs in construction and manufacturing. Opponents derisively claim the number could be as few as 5,000 jobs. Now, I tend to believe the labor unions and TransCanada, who have actually signed Project Labor Agreements specifying how this pipeline will be built, and by how many workers. But I have to question the project's opponents, who are so quick to dismiss their low-ball estimate of 5,000 jobs -- ignoring the fact that 5,000 jobs would make Keystone XL a much better job creator than many taxpayer-funded projects funded under the stimulus package. Before Solyndra went under, it employed 1,100 people and cost taxpayers over half a billion dollars. Today, Solyndra isn't creating any jobs except for a few bankruptcy attorneys."
    Chairman Upton also said, ". . .there is reason to question the claims that stopping the pipeline is the right thing to do environmentally. Without Keystone XL, Canada's rising oil production will reach its end users via increased use of tankers, barges, trains, and trucks -- all of which are riskier modes of transport than pipelines. The administration's own Final Environmental Impact Statement concludes that there is nothing to be gained by rejecting the pipeline."
    In an opening statement Ranking Member Henry Waxman (D-CA) said, "If we approve the Keystone XL pipeline, we might help with job creation in other countries. But it won't do much for the United States. A green light for Keystone will lead to massive imports of transmission pipe manufactured overseas. I'm sure the steel mills in India or China will be delighted. Canada will be able to export its tar sands to the global market, rather than having to sell it at a discounted rate in the Midwest. And because the products will be exported from a Foreign Trade Zone, China will be pleased that it can buy petroleum products without having to pay U.S. Customs duties. . .
    "The American people will bear the risks, and Big Oil will reap the rewards. With this pipeline, we get more carbon pollution . . . more dangerous oil spills . . . land seizures by a foreign company . . . and higher oil prices in the Midwest. Big Oil gets the ability to extract more profits from the Midwest . . . a conduit for exporting tar sands products to China . . . and the green light to exploit the tar sands at maximum speed, regardless of the consequences.
    "President Obama listened to the differing views of American citizens and made a responsible decision. He would not approve the pipeline through the ecologically fragile Sand Hills area in Nebraska, but the State Department would consider an alternative route. Nebraska is taking the time to find a route that is acceptable, and the President is making sure that he has all the information he needs to make the right decision. This bill takes the opposite approach. It gives the pipeline an unprecedented regulatory earmark. It directs FERC to approve the pipeline even though we don't yet know what route it will take through Nebraska. . .
    "I wanted to know why Koch would tell the U.S. Congress one thing and the Canadian government the exact opposite. Unfortunately, Chairman Upton and Chairman Whitfield have refused to invite Koch to testify. So we are left with unanswered questions. Why is Koch Industries being placed in a witness protection program? What does the company have to hide? And why does the company get special treatment while the American people get left in the dark?. . . This pipeline is a bad idea, and so is this bill."
    Democrats offered amendments which were defeated relating to: regarding restrictions on use of eminent domain (defeated); barring the exportation of any pipeline products; requiring the President's approval; requiring a review of the risks associated with transporting diluted bitumen; and requiring that at least 75% of the iron and steel used be produced in North America.
    Access a release from House Republicans (click here). Access the Republican markup website for background information, full text, webcast and opening statement (click here). Access the Democratic markup website for Democratic amendments, webcast and opening statement (click here). Access legislative details for H.R.3548 (click here). [#Energy/KXL]
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