Canadian Manufacturing

Suspense lingers as Keystone pipeline saga reaches critical chapter

spokesperson wouldn't reveal U.S. President Barack Obama's intentions as Keystone XL legislation inches closer



WASHINGTON—As the long-running saga over the Keystone XL pipeline enters a critical phase, United States President Barack Obama is allowing suspense to linger for at least a few more days.

A spokesperson wouldn’t reveal the president’s intentions as the new Republican-dominated Congress prepared legislation that would force construction of the pipeline from Canada.

“I’m going to reserve judgment … until we actually see what language is included in that specific piece of legislation,” said Obama spokesperson Josh Earnest.

“I’m not prepared at this point to issue a veto threat related to that specific piece of legislation.”

It’s become accepted wisdom in Washington that the president would veto such a bill given his skeptical comments lately about the Canadian oil-infrastructure project, and also given the radical recent shift in oil economics.

Indeed, Earnest listed a series of concerns about the project at a White House briefing: It won’t lower American gas prices, would create few permanent jobs, could impact carbon emissions and, he said, still needs to undergo an as-yet-uncompleted federal review that can’t be finished until a Nebraska court renders its verdict in a dispute over the route.

But when given a chance to kill the bill the White House has, so far, kept its veto pen sheathed.

Earnest not only declined to say whether the White House would cancel the bill—he also refused to say whether it hoped Democrats voted against it.

Earnest said the president wanted to see the legislation first, in an echo of remarks Obama himself made before the holidays.

He’ll get the chance to see it soon.

A Keystone bill is expected to be introduced in the Senate as early as Jan. 6; a hearing is planned for the following day; and lawmakers could start negotiating possible add-ons to the legislation as early as Jan. 8 before a debate begins next week on the chamber floor.

The new Republican majority has anointed Keystone as its No. 1 legislative priority of the new 2015-16 Congress.

To increase the already strong chances of it passing in this new legislature, Republicans will allow Democrats to amend it.

That means the bill might be significantly bigger by the time the debate’s done.

Democrats plan to pack it with their own priorities.

High-ranking Democrat Chuck Schumer has promised provisions that would support clean energy technology, insist that U.S. steel be used in the pipeline, and restrict exports of oil from the project.

But, speaking in a weekend TV interview, Schumer said he’d still advise the president to veto the bill.

Obama would then have to make a decision: Sign the bill, or veto.

If he does the latter, he could argue that he needs more time to complete the standard review once the Nebraska case wraps up.

He made a similar move in 2012.

Congress packed an unrelated bill with a Keystone provision that demanded a decision from the president within 60 days.

Obama responded by signing the bill into law, then rejecting the pipeline on the grounds that he didn’t have enough time to finish his review, and forcing that administrative process to start all over again.

“I think we’re going to get indication of how this president wants to govern in the last two years and how he wants to work with Republicans in Congress,” Republican Sen. John Thune told Fox News over the weekend.

“This will certainly be a way in which we can measure where he’s going to come down.”

Aside from the new composition of Congress, there’s another big difference since 2012: Plummeting oil prices.

Opponents of the project have pointed to lower prices at the pumps and argued that the president no longer faces much political pressure to approve new energy infrastructure.

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