In one of his first acts in office, President Joe Biden signed an executive order revoking the construction permit for the Keystone XL pipeline, which would have routed approximately 830,000 barrels of crude oil a day from Canada to Nebraska on its way to Gulf Coast refineries. Biden’s move — the latest development for a project that has become a flashpoint for the climate change debate — was applauded by environmentalists and American Indian groups but sparked objections from the oil industry.
The controversial project has spanned multiple presidential administrations. Former President George W. Bush approved the original Keystone pipeline, which began operating early in former President Barack Obama’s first term. When the proposed Keystone XL pipeline expansion was announced in 2008, American Indian groups and environmentalists pressured Obama to stop it over concerns that it could spill and would promote production of dirty oil sands in Alberta, Canada. He eventually rejected the permit, but former President Donald Trump reversed that decision early in his presidency.
Biden rejected the permit as part of his commitment to move toward a “sustainable climate pathway” and promote clean energy. “The Keystone XL pipeline disserves the U.S. national interest,” the executive order stated. “The United States and the world face a climate crisis. That crisis must be met with action on a scale and at a speed commensurate with the need to avoid setting the world on a dangerous, potentially catastrophic, climate trajectory.”
Environmentalists, including the Natural Resources Defense Council (NRDC), applauded the move. “It makes the United States once more part of the global climate solution — not the problem,” NRDC Interim President Mitchell Bernard said in a statement. “It makes clear that the country is moving away from dirty fossil fuels and toward cleaner, smarter ways to power our future.”
Indigenous groups also spoke out in support of the order to revoke the permit since the pipeline would run near and could endanger tribal land and waterways. “This project is an extension of the racial, environmental and social injustices we have suffered,” Harold Frazier, chairman of the Cheyenne River Sioux Tribe in South Dakota, said in a statement. “Stopping this project protects our children and future generations and gives them the opportunity to thrive in a world that we leave them, rather than trying to survive what we damaged for them.”
Local policymakers and oil and gas stakeholders called on the president to consider the economic ramifications of his decision. On a phone call with Biden following the announcement of his order, Canadian Prime Minister Justin Trudeau expressed his country’s “disappointment” and “underscored the important economic and energy security benefits of our bilateral energy relationship as well as his support for energy workers,” according to a statement released by his office.
Jason Kenney, the premier of Alberta, said Biden’s move was an “insult” and a “gut punch.” Kenney’s administration invested about $1.5 billion in the Keystone project in 2020, and the premier pushed for Trudeau’s administration to consider trade sanctions, which Trudeau declined to issue.
Montana Gov. Greg Gianforte (R) said the pipeline was a potential “lifeline” for his state. “Over $100 million in annual taxes that we were counting on to pay for teachers, to pay for law enforcement, to pay for infrastructure — we need this in rural Montana,” Gianforte said in an interview on Fox & Friends. The pipeline also had support from Montana Democrats, including Sen. Jon Tester, who encouraged Biden to meet with advocates and opponents before making a decision.
Industry leaders say that canceling the project would cause short-term and long-term job losses since the pipeline was anticipated to create new jobs in the oil industry in the Gulf of Mexico. An estimated 1,000 construction jobs were lost after Biden’s order. Gifford Briggs, the Gulf Coast regional director for the American Petroleum Institute, told a local news outlet there was a “good likelihood that companies in Louisiana were planning on working on the Keystone Pipeline, so those jobs will be lost.”
TC Energy, the company behind Keystone XL, said in a statement ahead of the executive order that the move “would directly lead to the layoff of thousands of union workers and negatively impact ground-breaking industry commitments to use new renewable energy as well as historic equity partnerships with Indigenous communities.”
Although no action has been announced, TC Energy or the province of Alberta could file a lawsuit against the Biden administration over the decision. It is unlikely a lawsuit would succeed in overturning Biden’s rejection.
For more background, see the February 2016 issue of Congressional Digest on “Combating Climate Change.”
