(The Center Square) – Sixteen Republican attorneys general, led by Montana Attorney General Austin Knudsen, have called on President Joe Biden to reinstate the permit for the Keystone XL pipeline after learning that his administration wants to increase oil imports from Canada.
“The oil you now want to import from Canada is the same oil that would have flowed through the Keystone XL pipeline, which would have transported nearly a million barrels per day – not only from Canada but from the Bakken oilfields in Montana and North Dakota – to American refineries,” the attorneys general write.
“The hypocrisy would be stunning if it weren’t so insulting to American energy workers and those in rural communities who benefited from the pipeline’s many economic opportunities.”
In their April 18 letter, they argue, “We have repeatedly asked you to reconsider this misguided (and we continue to believe unlawful) decision,” referring to a letter AG Knudsen and 13 AGs sent Biden in February 2021. In it, they warned of the serious detrimental consequences that would result from halting the pipeline.
If Biden didn’t reverse his decision, they argued, “Americans would ‘suffer serious detrimental consequences,’ consumers would pay higher prices, and our allies would become further dependent on Russian and Middle Eastern oil.”
More than a year later, the AGs said, “We hate to say we told you so.”
One solution to rising costs, sky-high gas prices and supply shortages is to prioritize domestic energy production, the AGs argue. They called on Biden “to reverse the damage you have done and provide relief for struggling families and businesses. It’s never too late to admit your mistakes.”
Now, “Just over a year later,” they add, “new record high gas prices are seemingly set every day, economy-wide inflation – the highest in 40 years – is straining the budgets of American families, and European countries are unable to impose oil and gas sanctions on Russia without risking an economic recession.
“Instead, European countries are spending $1 billion per day on Russian oil and gas and literally funding Vladimir Putin’s invasion of Ukraine in the process.”
The pipeline project took years to obtain some of the most strenuous environmental and regulatory approvals, including through years of delays and lawsuits during the Obama administration. However, construction began after President Donald Trump approved the project, issuing the Keystone XL’s 2019 Presidential Permit.
The 1,200-mile pipeline was designed to carry crude oil from Hardisty, Alberta, Canada, through Montana and South Dakota to Steele City, Nebraska.
The existing pipeline stretches from Hardisty to Steele City, and then branches off to reach refineries in Houston and Nederland, Texas, and in Pekota, Illinois.
Biden revoked the permit via executive order on his first day in office, saying the pipeline “disserves the U.S. national interest.” Instead, he argued, the U.S. “must be in a position to exercise vigorous climate leadership” and canceling the pipeline would help put the world “on a sustainable climate pathway.”
Communities and small towns in Montana, South Dakota and Nebraska began to expand after an influx of construction workers moved to areas along the pipeline's path after Trump’s authorization. With them, a range of supporting businesses and services also increased. After Biden's executive order, the growth died overnight. Thousands of workers lost their jobs and left seeking work elsewhere. Most supporting businesses closed, and families moved out seeking work elsewhere. The small towns along the pipeline's path that had expected economic and population growth, and states expecting increased revenue, instead suffered significant losses.
"It's not just about a pipeline – it's about the investments real South Dakotans made in response to a project that earned all its permits and was already under construction," U.S. Rep. Dusty Johnson of South Dakota said at a round table last year. "It's about the hotel owner who made upgrades, the gym owner who hired extra staff, and the gravel pit owners who purchased new equipment. Cancelling the Keystone XL Pipeline with a flick of the pen destroyed the investment made by thousands of everyday Americans."
One year later, the small South Dakota town of Philip is barely holding on.
“We are the collateral damage," West Central Electric Cooperative CEO Jeff Birkeland told Fox News. "Our one chance in a lifetime to get some opportunity, some growth, to lower our rates for our members, and he took it away from us.”
Montana is estimated to lose $58 million in tax revenue annually in addition to losing the benefits of future easements and leases, and several counties losing their single-biggest property taxpayer, Knudsen said.
Nationally, it’s estimated that the pipeline would have strengthened U.S. GDP by more than $3 billion, carried roughly 830,000 barrels of oil a day from Canada to the U.S., and directly and indirectly provided up to 26,000 jobs. Roughly 11,000 of them were instantly lost after Biden canceled the pipeline.
In addition to halting Keystone XL, the Biden administration implemented a range of restrictions on domestic production and within months, gas prices reached a seven-year high. As gas and other prices kept climbing, the administration continued to impose regulatory restrictions on domestic production, instead turning to OPEC+ countries, including Russia, Saudi Arabia, and Venezuela, to produce more oil.
Of this approach, the AGs argued, “Your vitriolic language and vilification of the American fossil fuel industries while holding out your hand to the despotic foreign leaders whose interests directly conflict with American values has undoubtedly depressed American energy development both on- and off-shore.”
The AGs called on Biden to reauthorize the pipeline, provide regulatory certainty to companies willing to build it, and prioritize domestic energy development “to prevent future economic hardship for Americans.”