Pipeline Industry Applauds Revival of KXL, DAPL Projects
Pipeliners are rejoicing President Donald Trump’s signing of two executive orders to revive long delayed pipeline projects. On Jan. 24, the president signed five such orders, the first two concerned the Keystone XL (KXL) pipeline and the Dakota Access Pipeline (DAPL).
Associations and think-tanks that support the energy industry released a flurry of supportive statements praising the actions.
The Association of Oil Pipe Lines (AOPL) expressed gratitude for the moves on behalf of pipeline operators.
“We thank President Trump for giving the American people the benefits of jobs and plentiful, affordable energy that pipelines will bring,” said Andrew Black, president and CEO of AOPL.
AOPL said that the signing of the executive orders demonstrated Trump’s support for the two pipelines and for streamlining the review and approval of pipeline projects generally.
Construction of the KXL pipeline would provide more than 42,000 U.S. jobs and $2.1 billion in U.S. worker payroll, according data AOPL attributed to the U.S. State Department. While the project would support 6,800 construction jobs with $420 million in payroll, it would also lead to 4,600 manufacturing jobs with $309 million in payroll, 4,400 jobs in trade with $172 million in payroll, 2,200 jobs in finance and insurance with $131 million in payroll, 5,100 jobs in other professional services with $343 million in payroll, 2,700 jobs in health services with $141 million in payroll, and 5,700 jobs in food and accommodations with $278 million in payroll.
The State Department’s environmental review also found building KXL would do more to protect the environment and avoid greenhouse gas emissions than any alternative, including rejecting the pipeline. According to U.S. government statistics, 99.999 percent of petroleum products shipped by pipeline reach their destination safely. Since 1999, the number of incidents along pipeline rights of way is down 50 percent.
The Dakota Access Pipeline has created roughly 12,000 jobs during construction and is a critical link from the Bakken formation, which supports more than 80,000 North Dakota jobs, according to the AOPL statement. It has brought hundreds of millions of dollars in investment in heavy equipment and thousands of construction jobs to the state. DAPL has already spent more than $3.54 billion in construction and development of the pipeline and continues to invest hundreds of millions a month into the U.S. economy as it moves to finish the project. The Dakota Access Pipeline project will result in an estimated $156 million in sales and income taxes during construction and $55 million in property taxes annually.
The Consumer Energy Alliance (CEA) also praised the president’s actions, but stressed that the United States needs to build even more pipelines.
“Critical infrastructure projects like Keystone XL and Dakota Access will bring much-needed crude oil to markets, which will help create the fuel, power and products that Americans use every day,” said CEA president David Holt.
Holt added that Trump’s decision to greenlight KXL and DAPL will “create both immediate jobs and long-term economic opportunities” for people across the United States.
“But America needs even more pipelines to move forward,” he said. “As part of CEA’s Pipelines for America campaign, CEA recently released a report (see p. ??) showing how failing to construct vital oil and natural gas pipelines, which deliver fuel and electricity to our homes and businesses, will result in a 31 percent shortfall in U.S. electricity capacity by 2030.”
American Petroleum Institute (API) president and CEO Jack Gerard added to the applause, saying the Trump administration’s actions are advancing energy infrastructure projects throughout the country.
“We are pleased to see the new direction being taken by this administration to recognize the importance of our nation’s energy infrastructure by restoring the rule of law in the permitting process that’s critical to pipelines and other infrastructure projects,” Gerard said. “Critical energy infrastructure projects like the Keystone XL and the Dakota Access Pipelines will help deliver energy to American consumers and businesses safely and efficiently.
The Canadian Association of Petroleum Producers (CAPP) called the executive orders a “a major step forward for Canada, the United States and North America.”
“As our largest trading partner, the relationship that Canadian producers share with the U.S. is a critical one,” said CAPP president and CEO Tim McMillan in a Jan. 24 statement.
S.T. Karnick, director of research at the free market think-tank the Heartland Institute, said reviving the projects is a “big win” for U.S. citizens.
“Pipelines are cheaper, more reliable and safer than freight trains for transporting oil, and the increase in production means our nation’s consumers and businesses will get the best prices possible,” Karnick said. “Lower energy costs also make U.S. manufacturing more competitive. That will create well-paying jobs and put people back to work.”
Completing the pipeline projects will be a boon for U.S. jobs, according to the Institute for Policy Innovation (IPI), a conservative think-tank based in Lewisville, Texas.
“Nothing has been a bigger boost to the middle class than the nearly decade-long U.S. energy boom,” said IPI resident scholar Merrill Matthews, Ph.D. “The number of new high-paying jobs in the oil and gas industry has increased by more than a quarter million between since 2003. President Trump realizes that is a great way to grow a stronger middle class.”AOPL, API, Consumer Energy Alliance (CEA), Dakota Access Pipeline, Keystone XL