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(Reuters) – President Barack Obama on Friday rejected the proposed Keystone XL oil pipeline from Canada in a victory for environmentalists who campaigned against the project for more than seven years.
“The pipeline would not make a meaningful long-term contribution to our economy,” Obama told a press conference. He said it would not reduce gasoline prices, and shipping “dirtier” crude from Canada would not increase US energy security.
The denial of TransCanada Corp.’s more-than-800,000-barrels-per-day project will make it more difficult for producers to develop the province of Alberta’s oil sands. It could also put the United States in a stronger position at global climate talks that start in Paris on Nov. 30, in which countries will aim to reach a deal to slow global warming.
US Secretary of State John Kerry, who determined the pipeline was not in the country’s interest before Obama’s final decision, said approving Keystone “would significantly undermine our ability to continue leading the world in combating climate change.”
Keystone XL would have linked existing pipeline networks in Canada and the United States to bring crude from Alberta and North Dakota to refineries in Illinois and, eventually, the Gulf of Mexico coast.
TransCanada first sought the required presidential permit for the cross-border section in 2008, but the proposal provoked a wave of environmental activism that turned Keystone XL into a rallying cry to fight climate change. Blocking Keystone became a litmus test of the green movement’s ability to hinder fossil fuel extraction in Canada’s oil sands.
“This is a big win,” said Bill McKibben, co-founder of an environmental group which helped make Keystone a symbol of a movement to slow global oil output. Obama’s decision “is nothing short of historic, and sets an important precedent that should send shock waves through the fossil fuel industry.”
TransCanada and other oil companies said the pipeline would have strengthened North American energy security, created thousands of construction jobs and helped relieve a glut of oil.
But since 2008, the United States has experienced a domestic drilling boom which has boosted oil production 80 percent and contributed to a slump in US oil prices from above $100 a barrel to about $44.
Newly sworn-in Canadian Prime Minister Justin Trudeau, a supporter of Keystone, voiced disappointment but said the Canada-US relationship “is much bigger than any one project.”
TransCanada Chief Executive Russ Girling said the company would review its options to potentially file a new application for a pipeline to bring oil sands crude to the United States.
“Today, misplaced symbolism was chosen over merit and science, rhetoric won out over reason,” he said in a statement.
A senior US State Department official left open the possibility TransCanada could seek a different decision under another US administration, telling reporters that “for the State Department to reconsider the application at any time, the company would have to reapply.”
TransCanada had asked the Obama administration on Monday to pause the review, in a move seen by many as an attempt to postpone a decision until a new US president took over in 2017. TransCanada shares fell 5.2 percent on the Toronto stock exchange on Friday to C$42.90.
All the Democratic US presidential candidates oppose the pipeline, while most Republican candidates are in favor.
Friday’s rejection was a loss for Republicans on Capitol Hill who in January had made Keystone their top issue of the new Congress. They passed a bill that would have allowed Congress to decide on the pipeline, legislation Obama vetoed.
Sen. John Hoeven, a Republican from oil-producing North Dakota, said TransCanada would be able to challenge the decision under international trade agreements such as NAFTA or the World Trade Organization.
Obama’s decision will have a “chilling effect” on any company considering building energy infrastructure*, which could leave the United States at risk in the long term of not having the pipelines it needs, Hoeven said in an interview. [*Infrastructure refers to the fundamental facilities and systems serving a country or city necessary for its economy to function. It typically includes structures such as roads, bridges, tunnels, water supply, sewers, electrical grids, telecommunications. Energy infrastructure is the large-scale enabling technologies to transport energy from producer to consumer.]
Reprinted here for educational purposes only. May not be reproduced on other websites without permission from Thomson Reuters. Visit the website at Reuters .com.
Questions
1. The first paragraph of a news article should answer the questions who, what, where and when. List the who, what, where and when of this news item. (NOTE: The remainder of a news article provides details on the why and/or how.)
2. Why did President Obama reject the Keystone XL pipeline?
3. a) What effect will the rejection of the Keystone XL pipeline have on producers?
b) What effect will the rejection of the Keystone XL pipeline have on Obama administration officials who are fighting global warming?
c) Why is Secretary of State John Kerry opposed to the Keystone XL?
4. What did Keystone XL represent to environmental groups?
5. a) What benefits did TransCanada and other oil companies say the pipeline would have provided to the U.S.?
b) TransCanada Chief Executive Russ Girling said in a statement, “Today, misplaced symbolism was chosen over merit and science, rhetoric won out over reason.”
Rhetoric is defined as: language that is intended to influence people and that may not be honest or reasonable. Do you agree with Mr. Girling’s assertion? Explain your answer.
6. What concern does Republican Senator John Hoeven have about President Obama’s decision?
7. a) Where do the presidential candidates stand on the Keystone XL decision?
b) TransCanada had asked the Obama administration on Monday to pause the review, in a move seen by many as an attempt to postpone a decision until a new US president took over in 2017. How does your candidate stand on the Keystone issue? Find links to all candidates’ websites at: StudentNewsDaily’s 2016 Presidential Election page.
CHALLENGE: Read the “Background” and check out the links under “Resources.” Does this information change your view of the Keystone XL? Explain your answer.
Background
From an InstituteforEnergyResearch post on 9/29/11:
- Three years ago [in 2008], TransCanada proposed the $7 billion Keystone XL pipeline to bring more oil from Canada to the United States. After years of study, the State Department has yet to decide whether or not approve the pipeline. The Keystone XL should be a no-brainer—more jobs and greater access to oil from our closest ally.
- Because the pipeline crosses the border from Canada, the State Department must decide whether the pipeline is in the “national interest.” This should be a simple question. Is it in the “national interest” to get oil from Canada, our largest trading partner and most reliable ally, or should we import more oil from more hostile countries? Even without considering the economic arguments, it should be that simple.
- The economic arguments for the pipeline are also persuasive. The construction of the pipeline alone will create 20,000 jobs. States along the route are projected to receive an additional $5.2 billion in property tax revenue.
From a Bloomberg News editorial posted 9/26/11:
- In deciding whether to allow Keystone XL to run through six American states, the only relevant question is whether it would be safe. The State Department, with help from the Environmental Protection Agency, has studied the risks. It has determined that, as long as TransCanada complies with all laws and regulations, builds Keystone XL properly and operates it safely (although some minor spills would be expected), the pipeline would have “no significant impacts” on wetlands, water supplies or wildlife along its route.
- Keep in mind, the U.S. is crisscrossed by thousands of miles of pipelines carrying crude oil, liquid petroleum and natural gas. One of these is the Keystone 1 pipeline, which already carries crude from the oil sands. Yes, these pipes sometimes leak — spectacularly last year (2010) when almost 850,000 gallons of oil spilled from a ruptured pipe in Michigan. Far more often, when leaks occur, they are small and self-contained.
- Pipeline opponents have implied that if the U.S. doesn’t buy Canada’s oil, then companies will be discouraged from developing the oil sands. But it’s unrealistic to assume that the oil couldn’t be sold elsewhere. Yes, today’s business plan calls for sending most of it south — some 700,000 barrels a day through Keystone XL. If the U.S. blocks that conduit, though, we can reasonably expect that another pipeline would be built to Canada’s west coast, where the oil could be sent by tanker to China and elsewhere.
The opposing viewspoints on global warming are:
- The earth’s climate is warming as a result of human actions; an extreme change in the earth’s climate is going to occur, caused by greenhouse gas emitted by the world’s use of fossile fuels (coal, oil, gas). This temperature change will result in catastrophic problems in the environment. Humans must drastically reduce the consumption of fossile fuels immediately. To prevent this man-made climate change, countries need to restrict energy use (reduce use of gas and oil).
Liberals generally hold this view. Check out two liberal organizations which defend this viewpoint:
Natural Resources Defense Council and Greenpeace. - Human activity does not affect the earth’s temperature. Burning fossil fuels (gas, coal and oil) does not cause climate change. The earth’s climate changes naturally, but not so much that it will cause a change of catastrophic proportions. An extreme change in the earth’s climate will not happen. There are natural warming and cooling trends over time. In the 1970′s a coming ice age was predicted, but now that scare has been replaced with the current global warming scare.
Conservatives generally hold this view. A conservative organization which supports this view is: FriendsOfScience.
NOTE: The UN climate conference (of Dec. 2007) met in Bali to discuss global warming met strong opposition from a team of over 100 prominent international scientists, who warned the UN that attempting to control the Earth’s climate was “ultimately futile.” The scientists, many of whom are current and former UN IPCC (Intergovernmental Panel on Climate Change) scientists, released an open letter (Dec. 13, 2007) to the UN Secretary-General questioning the scientific basis for climate fears and the UN’s so-called “solutions.”
Read the complete letter here.
Global warming is an important issue to understand. The theory that man’s use of fossil fuels (burning coal, oil and gas for energy, which produces carbon dioxide, or CO2) is causing an imminent catastrophic change in the climate – global warming– is believed to be true by many scientists, climatologists, citizens, the mainstream media and Hollywood celebrities, and was made popular by former Vice President Al Gore’s movie “An Inconvenient Truth.” People who believe in this theory say we must reduce the amount of carbon dioxide produced by limiting/reducing the amount of fossil fuels we use, or by purchasing offsets.
The belief that man’s activities are not causing an imminent catastrophic change in the climate is held by many other scientists (see MIT’s Professor of Meteorology Dr. Richard Lindzen’s commentary in Newsweek). This view is very unpopular in the media and widely condemned by those who believe man-made global warming is fact. See Newsweek magazine’s online presentation “The Global Warming Deniers.” Those who do not believe man is causing the global temperature to rise don’t believe it is necessary to reduce the production of CO2 by reducing our use of fossil fuels or to purchase carbon offsets.
- Greenhouse gases are components of the atmosphere that contribute to the greenhouse effect. Some greenhouse gases occur naturally in the atmosphere [water vapor, which is the most abundant], while others result from human activities such as burning of fossil fuels such as coal, oil and gas. Greenhouse gases include water vapor, carbon dioxide, methane, nitrous oxide, and ozone. (from wikipedia.org)
- Carbon offsetting involves paying others to remove or [contain] 100% of the carbon dioxide emitted from the atmosphere – for example by planting trees – or by funding ‘carbon projects’ that should lead to the prevention of future greenhouse gas emissions, or by buying carbon credits to remove (or ‘retire’) them through carbon trading. These practices are often used in parallel, together with energy conservation measures to minimize energy use. (from wikipedia.org)
Resources
What do energy pipelines transport? Find the answer at: pipeline101.com/Overview/commodities.html
Read about crude oil pipelines at pipeline101.com/overview/crude-pl.html
For a detailed map of all pipelines in the U.S., click here and scroll down.
Read about Keystone pipeline at:
- instituteforenergyresearch.org/2011/09/29/keystone-xl-more-energy-and-more-jobs
- wikipedia.org/wiki/Keystone_Pipeline
- instituteforenergyresearch.org/analysis/an-economic-analysis-of-keystone-xl
Daily “Answers” emails are provided for Daily News Articles, Tuesday’s World Events and Friday’s News Quiz.
