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Keystone XL Pipeline: How Long Will the Jobs Last?

Jan Lee
Jan Lee | Wednesday July 31st, 2013 | 11 Comments

Keystone_XL_Polar_Endeavour_31930_Walter_SiegmundIs the Keystone XL pipeline that TransCanada wants to construct from the Alberta tar sands to southern U.S. ports worth 20,000 U.S. jobs, or 2,000?

According to TransCanada, it depends upon your political leanings.

Last week, during an interview with New York Times, President Obama suggested that TransCanada’s estimation that the project would yield as many as 20,000 U.S. jobs might be less than realistic.

“(My) hope would be that any reporter who is looking at the facts would take the time to confirm that the most realistic estimates are this might create maybe 2,000 jobs during the construction of the pipeline,” said Obama, who noted that the construction phase is only expected to take a couple of years. After that, “we’re talking about somewhere between 50 and 100 (jobs).”

“I wouldn’t think the president would come out externally and in the media and actually agree with the Republicans regardless of what he might think in private,” responded TransCanada spokesperson, James Millar in an interview with the Calgary Herald  last Sunday.

Millar’s comment may be a bit of a surprise to some environmental groups that have expressed frustration with Obama’s apparent vacillation over the issue. After he advocated for a hold on the project in late 2011, the Sierra Club and other anti-Keystone XL pipeline advocates accused the president of going back on his word this year as the project moved ahead. Just last June, Obama stated that he would not support the Keystone XL if it would “significantly” worsen climate change.

But then, partisan standpoints do appear to play a part in the Keystone XL pipeline issue. It’s no secret that some of the Keystone XL pipeline’s largest supporters in the U.S. happen to be Republican. Last week, Huffington Post reported that at least a dozen Republican lawmakers had written “lobbyist-inspired” letters  in support of the project. The article criticized the fact that there were noticeable similarities in the wording of most of the missives.

Keystone_XL_Fuel_Barrels_Trevor_McInnisAnd TransCanada knows that it enjoys the support of Republican lawmakers. Opensecrets.org reports that TransCanada’s contributions to Republican candidates running for office in 2012 out-distanced what it contributed to Democratic candidates by more than 4 to 1. Its contributions to House representatives since 2010 have gone almost exclusively to Republican members.

As to Obama’s comment about TransCanada’s numbers, his comment sounded more like a news lead to a reporter than a fact. In the end, it will be up to the reporters on the beat to look at the historical job growth in new industries and figure out which total best fits.

But it would seem to me that the renewable energy sector could offer some insight into this issue. Like the proposed Keystone XL pipeline, wind and solar take an inordinate amount of construction before they are up and running. They give back to communities in the form of secondary industry growth, but after the wind farm or solar park are up and running, well, it’s good to go. Meanwhile, they have given birth to new businesses and new opportunities.

Perhaps the question that pundits need to ask when figuring out who is right, is what Keystone will be able to offer back to communities in the form of secondary industries five, 10, 20 years from now. Will there be more pipes to lay? More shipping routes to create? Is that the plan? And how will that benefit the U.S. as we strive to move toward more sustainable energy sources?

As always, it will be interesting to see what the president’s next step is, while both sides vie for support. If anything, his latest comment suggests that he’s well aware that it’s a complicated topic, and that good fact checkers, just like those many pipe layers that TransCanada keeps talking about, need to know how to use their skills to dig.

Oil tanker photo courtesy of Walter Siegmund.

Oil barrels photo courtesy of Trevor McInnis


▼▼▼      11 Comments     ▼▼▼

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  • Murray_B

    Greetings from western Canada.

    This entire debate is happening way out in left field and it needs to get real. Texas is running short of oil and must import more to keep their refineries running. Currently most of this oil is coming in by tanker. Now Exxon wants to bring in oil by pipeline from an affiliate in Canada that extracts bitumen. The obvious alternative to this is to close the refineries in Texas and build them in Canada to upgrade the bitumen there. That is very likely to happen soon because it is too costly to keep moving hydrocarbons by tanker or rail.
    The real choice here is whether it is better to keep the jobs in Texas or move them up to Canada. As a Canadian I say cancel that pipeline, Eh!

    • ssj12

      Where do you get your info? You know the USA exported more oil than it took in last year right?

      • Murray_B

        Holy crow, where do you get your information? The U.S. has not been a net exporter for decades. Many reserves in Canada are counted as U.S. reserves for some reason but a whole lot of Canadian oil crosses the border to the U.S. every day. There is a good map at http://www.pipeline101.com/Overview/crude-pl.html
        Do you see all the red trunk lines? Those are large lines carrying crude to the U.S. See the junction point in Canada? That is the city where I live and it is south of the 2 trillion barrel Athabasca Tarsands reserve. [Why the official U.S. government estimate is only 2 billion barrels is anybody's guess.] That reserve is so large that it can supply total world demand for 350 years before it is exhausted.
        Anyway I will let you know when Exxon’s affiliates start laying down the new refineries because at that point contracts will have been signed and all those refinery jobs will leave Texas permanently.

        • J_N_Lee

          Great discussion, Murray_B and ssj12. Thanks for the comments!

          I did a double-check and while ssj12 is correct that there was a solid exporting industry (thanks for mentioning this!), the stats stop in 2009. Congress began limiting exports in the 70s after the Arab oil embargo. But it is my understanding as well, that Texas oil fields have been running down, which is why the fracking business has such a large push (a side note is that it actually was attempted vigorously in the ’80s in Colorado with remarkably dismal results, so the fact that it’s going strong now may have as much to do with perceived need as new technology).

          That said, there’s been discussion in Congress about starting up new exports. But it’s important to note I think, that such exports would be based on the “new” industries, such as fracking, not on old reserves in, for example, TX.

          And I tip my hat to you across the prairies, Murray. I hale from Vancouver, so it’s an interesting discussion to hear on both sides of the border. Many points to be considered on *both* sides.

        • ssj12
        • J_N_Lee

          Thanks for the stats! I’ll follow that up with a bit more research; you’ve got my curiosity about what seems to be conflicting reports.

        • Murray_B

          I tip my hat [or would if I wore one] to you too, J_N_Lee. In my youth I often vactationed near Vancouver because I have many relatives there. It is a beautiful city and a great place to visit.

          What shocks me about current political debates is how delusional politicians have become. The important thing about the pipeline to Texas is not the 50 jobs the pipeline would create but the forty-some thousand that will be retained by using Canadian feedstock. Otherwise, all of those jobs, forty-some thousand + 50, are likely to move to Canada when the Texas refineries are shut down and new ones are built in Canada.

          As an Albertan I suppose I should be glad to hear that jobs will be moving here but I’m not. I just can’t see how major Canadian industries that rely on exporting to the U.S.can continue to operate when so many Americans are no longer able to afford what we produce. How can anyone with little or no disposable income keep buying things made with Canadian resources? It makes no sense.

          In the long term we will all be better off if those jobs stay in Texas where they belong.

        • ssj12
        • Murray_B

          Sorry, SSJ12 but I am not that interested in reading some theoretical and possibly erroneous material about the oil industry and the environment. So many groups are lying these days it is hard to know what is really happening. Remember the lie about how the O.P.E.C. oil embargo started the Energy Crisis. Yeah, right! An embargo in late ’73 caused “mile long” lineups in the summer of ’72. Sheesh, who makes this stuff up?

        • ssj12

          Government

          And do you know what is the only reason we are not in full economic meltdown? The petrodollar (US/OPEC deal).

        • Murray_B

          Our governments do lie, ssJ12, but do you know what actually caused the “mile long” lineups? It was misguided emissions legislation that compelled automakers to drastically reduce NOx emissions. This also forced them to dramatically reduce the efficiency of most car engines. The reduced efficiency caused environmentally-friendly vehicles to burn nearly twice as much fuel as previous models. It did not take long before the oil companies could not refine gasoline fast enough to satisfy the increased demand so they ran out of fuel and the crisis began. Have you ever heard any environmentalist admit those laws were a mistake? How about their telling us that the orginial life gas, carbon dioxide, is a poisonous pollutant?

          Most corporations also lie as do most lobby groups and the stuff in the mainstream media is often pure fantasy. Today it is pretty much all bunk all of the time from all sources and still they wonder why there is a growing crisis of confidence. Perhaps the decreasing trustworthyness has contributed to the current economic problems but It is kind of hard to tell without access to accurate information.

          It is a mystery why the Keystone XL debate seems to be focusing on the Canadian pipeline company that is to carry the oil to Texas, The carrier is not as important as the reason why a U.S.-owned company with refineries in Texas wants to bring oil feedstock down from their partially-U.S.-owned affililiates in Alberta. This debate needs to get real before the window of opportunity closes and Texas loses even more jobs [they once made computers, Guiberson diesels, and etcetera there] than they already have.