The Washington Post editorial board excoriated the Obama administration for holding up the Keystone XL pipeline [emphasis mine]:
If foot-dragging were a competitive sport, President Obama and his administration would be world champions for their performance in delaying the approval of the Keystone XL pipeline.
Last Friday afternoon, the time when officials make announcements they hope no one will notice, the State Department declared that it is putting off a decision on Keystone XL indefinitely — or at least, it seems, well past November’s midterm elections. This time, the excuse is litigation in Nebraska over the proposed route, because that might lead to a change in the project that various federal agencies will want to consider. The State Department might even decide to substantially restart the environmental review process. This is yet another laughable reason to delay a project that the federal government has been scrutinizing for more than five years.
As for the pipeline’s routing, planners and regulators have already considered all sorts of options through Nebraska, and they already shifted the route once. Neither route posed environmental concerns of a sort that would justify concluding that Keystone XL is outside the national interest. It is bizarre to imagine that a new route from an even more careful process in Nebraska would significantly increase environmental concerns.
The administration’s latest decision is not responsible; it is embarrassing. The United States continues to insult its Canadian allies by holding up what should have been a routine permitting decision amid a funhouse-mirror environmental debate that got way out of hand. The president should end this national psychodrama now, bow to reason, approve the pipeline and go do something more productive for the climate.
That will leave a mark.
UPDATE: This political cartoon illustrates how these delays have become a farce.
Oil production on the Fort Berthold Indian Reservation in North Dakota has become so large that it would rank among the top 10 oil producing states in the nation, a tribal leader said Tuesday.
Tex Hall, chairman of the Three Affiliated Tribes — Mandan, Hidatsa and Arikara — said the more than 1,000 wells in the Fort Berthold Indian Reservation produce in excess of 180,000 barrels of oil a day. Compared directly with state production, that puts them among the top 10 oil producers in the nation.
"It's a modern day gold rush. It's a modern day Deadwood, South Dakota," he said in a video statement that was broadcast at the tribe's third annual oil and gas expo at the 4 Bears Casino in New Town, North Dakota.
The tribes are also building an oil refinery to process Bakken oil.
Energy development is working for North Dakota, and with the right energy policies found in Energy Works for US produced by the U.S. Chamber’s Institute for 21st Century Energy, it can work all across the country.
While some environmental groups applauded the latest delay of the Keystone XL pipeline, unions whose members would be building it ripped the administration. Sean McGarvey, President of North America’s Building Trades Unions, AFL-CIO, called it “a cold, hard slap in the face for hard working Americans who are literally waiting for President Obama's approval and the tens of thousands of jobs it will generate.”
Laborers' International Union of North America (LIUNA) general president Terry O’Sullivan was more colorful, saying, "It’s clear the administration needs to grow a set of antlers, or perhaps take a lesson from Popeye and eat some spinach."
The Keystone XL pipeline isn’t the only energy issue dividing anti-energy environmental groups and unions who want jobs for their members. Over the weekend, the Associated Press reported that development of shale energy using hydraulic fracturing had strong union support in Pennsylvania:
"The shale became a lifesaver and a lifeline for a lot of working families," said Dennis Martire, the mid-Atlantic regional manager for the Laborers' International Union, or LIUNA, which represents workers in numerous construction trades.
Martire said that as huge quantities of natural gas were extracted from the vast shale reserves over the last five years, union work on large pipeline jobs in Pennsylvania and West Virginia has increased significantly. In 2008, LIUNA members worked about 400,000 hours on such jobs; by 2012, that had risen to 5.7 million hours.
In his Keystone XL statement, McGarvey head of the building trades union asked a good question:
Why does President Obama continue to side with radicals instead of the middle class that, twice, put him office, and supports this project by a significant majority?
Out of work American union members would like to know.
The continued delays on permitting the Keystone XL pipeline—the latest of which came last Friday—illustrate clearly why America needs a streamlined permitting process.
Keystone has become the poster challenge for delays and lost opportunities. For well over 5 years, American workers have been idled, while our nation continues to import oil from unfriendly nations that could have been displaced by Canadian oil from Keystone XL.
Keystone is just the latest in a slew of projects that has been held up by the current system. In fact, every year that major projects are stalled or cancelled because of a dysfunctional permitting process and a system that allows limitless challenges by opponents of development, millions of jobs are not created. For example, 351 stalled energy projects reviewed in one 2010 study had a total economic value of over $1 trillion and represented 1.9 American jobs not created.
The Chamber has been a strong and consistent voice in favor of a better process. In fact, our Institute for 21st Century Energy’s new Energy Works for US platform contains “Modernize the Permitting Process for Our Nation’s Infrastructure” as one of its 9 core planks. Specifically, the Energy Institute recommends a 2 year time limit on the State Department review process for proposed international projects (such as Keystone) as well as legislation to streamline and enhance coordination of the regulatory review, environmental decision-making, and permitting process for major construction projects. The recommendation would prohibit requiring more than one Environmental Impact Statement and one Environmental Assessment per project (except for supplemental documents). The Energy Institute also makes specific recommendations related to the permitting of electricity infrastructure, which is also a critical problem.
Some elements of the Chamber’s recommendations have been included in legislation. For instance, the Chamber and business community have endorsed H.R. 2641, the “Responsibly and Professionally Invigorating Development (RAPID) Act of 2013” and S. 1397, the “Federal Permitting Improvement Act of 2013.” These bills would help address the endless regulatory process that is stifling investment and hurting our energy infrastructure.
Democrats, Republicans, the White House, and the business community all agree that we must remove needless red tape that stalls and often kills major development projects: For this to occur, permit streamlining is a must.
Here’s an example of how the benefits of the shale energy boom radiate beyond the oil and gas industry. The Wall Street Journal reports that Home Depot opened only one store [subscription required] this past fiscal year, and it was in Minot, North Dakota, near the Bakken shale formation.
Home Depot went there because energy production is driving economic growth:
"If you had said to me seven years ago, you'll be opening a store in Minot, North Dakota, I would have asked, Why?" Chief Executive Frank Blake said in an interview. "One of the great stories of the U.S. is the shale oil development, and it's happening in areas where we don't have a lot of stores now."
Michael Glazer, CEO of Stage Stores, wishes his company had stores in North Dakota right now. He told the newspaper:
There's a correlation between the energy boom and county employment rates. And wherever energy comes in, jobs follow and people spend more at our stores.
He also posted a map showing that every county in the state saw at least 14% per-capital personal income growth from 2007-2012.Map: Per-capita personal income growth, 2007-2012
It’s no wonder Home Depot has expanded there.
Other major retailers see these trends as well:
Home Depot is among a number of retailers including Wal-Mart Stores Inc. and GameStop Corp. targeting oil and gas towns in North Dakota, Texas and Louisiana, in an otherwise dour environment for retail real estate.
Natural Gas Intelligence reports that cities in or near energy-rich areas are growing the fastest, according to a Census Department study:
Of the nation's 10 fastest-growing metropolitan statistical areas, six were within or near the Great Plains and near to some of the country's largest oil and gas fields, including Odessa, TX; Midland, TX; Fargo, ND; Bismarck, ND; Casper, WY and Austin-Round Rock, TX.
The same was true of micropolitan statistical areas, those ranging in size from 10,000 to 50,000 people, near oil and gas development. Seven of the fastest growing micro-areas were located in or near the Great Plains, with Williston, ND, ranked first in growth, followed by Dickinson, ND, and Andrews, TX.
Jobs and economic growth created by increased domestic energy production are drawing people to these cities. Businesses follow.
States that aren’t sitting on top of energy deposits also benefit from the shale energy boom, according to a 2012 report by IHS for the U.S. Chamber’s Institute for 21st Century Energy. For example:
Among non-producing states, fabricated metal manufacturing in Illinois, software and information technology in Massachusetts, and financial services and insurance in Connecticut are examples of central players in the US unconventional oil and gas supply chain.
The report noted, “By 2035, unconventional oil and gas will add almost $475 billion dollars to the economies of the lower 48 US states.”
As seen by what’s happening in North Dakota, this growth will also ripple outward into the broader economy.