Obama Rejects Argument Keystone Will Add Jobs, Cut Fuel Cost

Nov. 14 (Bloomberg) — President Barack Obama offered his

clearest critique of the case for the Keystone XL pipeline,

signaling a confrontation with Republicans as they try to force

approval of the project starting today.

“Understand what this project is: It is providing the

ability of Canada to pump their oil, send it through our land

down to the Gulf where it will be sold everywhere else,” the

president said today during a visit to Yangon, Myanmar. “It

doesn’t have an impact on U.S. gas prices.”

The statement repeats a main point used by opponents of the

project, including former hedge fund manager and now Democratic

fundraiser Tom Steyer. He and other critics have argued the

heavy crude from Alberta’s oil sands that will be carried by

Keystone is destined for overseas markets.

Supporters argue the project will create jobs and that the

oil is likely to stay in the U.S. and reduce the price of

gasoline for consumers.

Obama, during a news conference with Aung San Suu Kyi, the

Myanmar opposition leader, was asked by a reporter about a

scheduled vote in the House today and the Senate next week on

legislation that would approve the project over his objections.

Democrats said it will be the eighth time Republicans

sought to pass Keystone-related legislation. The difference this

time is the promise of Senate action on the same bill next week,

where it faces a closer vote. The Republican-led House will vote

about noon and probably pass the bill.

U.S. Review

Obama said his review, led by the State Department because

the pipeline would cross a border, shouldn’t be circumvented.

“This is a process that is supposed to be followed,” he

said. He said he would judge the project on whether it or not it

accelerated climate change or if it reduced energy costs and

gasoline prices for Americans.

“I have to constantly push back against this idea that

somehow the Keystone pipeline is either this massive jobs bill

for the United States or is somehow lowering gas prices,” Obama


Obama’s press secretary, Josh Earnest, said earlier this

week that legislation to override the government’s pipeline

review process wouldn’t be welcomed at the White House.

In the past, “we have indicated that the president’s

senior advisers at the White House would recommend that he veto

legislation like that,” Earnest told reporters yesterday in

Myanmar, where Obama is attending a summit.

Predicts Rejection

Michael McKenna, a Republican energy strategist and

president of MWR Strategies in Midlothian, Virginia, said he

believes Obama won’t allow the pipeline to be built.

“I don’t know how he could be any clearer,” he said.

Pipeline opponents said they were encouraged by Obama’s


“President Obama is standing with farmers, ranchers and

tribal families as we fight to protect our land and water,”

said Jane Kleeb, founder of BoldNebraska, a group that says the

pipeline is a threat to the state’s water resources and


The project would directly create the equivalent of 3,900

jobs during two years of building, according to a State

Department analysis. The total will shrink to 50 permanent

positions when the pipeline is operating, according to the


The department said the pipeline probably wouldn’t be a

significant contributor to global warming because the oil sands

would be developed and the crude sent to market even if Keystone

wasn’t approved. Rail roads and other pipelines have expanded

their capacity to move the oil to refineries.

The State Department suspended its review earlier this year

because of a legal challenge in Nebraska over the route’s path.

Obama said until the route was certain, “it’s very hard to

finish that evaluation.”

The House bill is H.R. 5682.

To contact the reporter on this story:

Jim Snyder in Washington at


To contact the editors responsible for this story:

Jon Morgan at


Steve Geimann

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