Biden’s Mistake of Revoking the Keystone XL Permit

Photo by Steve Rhodes is licensed under CC BY-NC-ND 2.0.

On his first day in office, President Joe Biden revoked the permit for the Keystone XL  through an executive order. Despite the potential political and environmental fallbacks of the pipeline, the economic benefits of the construction of the Keystone XL demonstrate that President Biden made the wrong decision. The pipeline, a 1,200 mile addition to the already existing pipeline complex, was designed to carry 830,000 barrels of oil per day from Alberta, Canada down to the Gulf Coast where the oil would be refined. The Keystone XL project was originally proposed in 2008 by energy companies TransCanada Corporation and ConocoPhillips, its joint owners. The proposed addition has received both significant support and backlash from Americans and Canadians throughout the past decade. 

The addition of Keystone XL will bolster both state and national economies. The existing pipeline, which transports oil across numerous American states, has shown that states will reap economic benefits by expanding it. As of 2014, the implementation of the southern section of the Keystone pipeline had piped $2.1 and $3.6 billion into the economies of Oklahoma and Texas, respectively. Such pipelines also create revenue for state and local governments in the form of property taxes. Specifically, Keystone XL will generate roughly $70 million in state and local taxes during the construction process and $55.6 million annually in property taxes. From the newfound revenue, states and cities will have more flexibility in their spending, and local communities will be able to improve the livelihood of their citizens through services such as restoring roads and enhancing the education system. 

Beside the economic gain from the pipeline construction, the pipeline would also produce many job opportunities to those in need of work. If Keystone XL had gone on as planned, it would have created more than 26,000 jobs, according to a study from the State Department. As a result of Biden’s executive order, thousands of workers are now out of a job, which hurts even more during the COVID-19 pandemic.

Those against Keystone XL may argue that the rise of renewable energy makes the pipeline a bad investment. However, even as new, cleaner energy sources become widely available, the consumption of oil in the United States will remain stable, if not increase, making it a vital factor when deciding whether or not to approve Keystone XL. Oil’s share of total domestic energy production will likely be in a similar position by 2040, so our need for oil will remain relatively the same, with or without the pipeline. 

Americans will benefit more from cheaper oil prices, which is made possible by Keystone XL. Without it, America will be forced to rely on less stable trading partners, such as Venezuela and the Middle East. Meanwhile, Canada, one of the United States’ most trusted allies, would ship their oil to India. Canada would make this decision based on economic reasoning as shipping is significantly less expensive than transporting the oil via railroads, which would be the mode of transportation without the Keystone XL. Pipelines, however, are much safer and cheaper than rail. As a result, Americans and the world will not be consuming any less oil; rather, what changes is where the oil comes from.

Keystone opponents argue the pipeline extension will lead to environmental consequences. Oil spills are notorious for their disastrous harm to ecosystems and wildlife; the BP Deepwater Horizon rig spilled over 130 million gallons of oil into the Gulf of Mexico, and there are signs that animals in the region are still suffering the damaging effects 10 years later. Many of those who sided with Biden are rightfully worried about the dangers that mismanaged pipelines and rigs can pose to the environment. However, the Keystone XL is nowhere near as mismanaged. The State Department commissioned five separate studies on the pipeline. Each of them returned results saying Keystone XL posed minimal risk to the environment and would have little to no effect on global warming. Biden revoked the permit to protect the environment, but the environment would not have even been affected. 

Interference with Native American territories presents another drawback to Keystone XL. TransCanada needs permission from the local tribes in order to use their land for the pipeline, as neither the national or state governments can grant the authority for construction workers to dig through Native American land. However, based upon the economic benefits mentioned above and the proven safety of the pipeline, numerous tribal leaders have no objection to the Keystone XL. There are, of course, tribes who are adamantly opposed to it. For the tribes where this is the case, it is more than possible for the pipeline to be rerouted. 

In short, Biden should have given the Keystone XL a green light. There are ample reasons for why it would have been a valuable asset for the United States. America benefits from stable, low gas prices, and environmentalists should rest assured that the pipeline operates with net zero emissions. If TransCanada could find a path for the pipeline that does not interfere with unwilling landowners, then there is little reason to reject the Keystone XL.