After more than a decade of political football, Canadian developer TC Energy formally canceled the construction of the Keystone XL pipeline earlier this month. President Biden dealt a death blow to the project by revoking its cross-border permit on his first day in office, leaving TC Energy with little choice but to scrap the pipeline construction. This rash decision by the Biden Administration is just the latest example of politics being used to cripple the U.S. energy boom.
Keystone XL would have safely transported 800,000 barrels of crude oil per day from Canada’s oil sands to refineries in the U.S., creating more than 11,000 good-paying union jobs. Estimates suggest that Keystone XL would have reduced American dependence on Venezuelan and Middle Eastern crude imports by 40%. With pipelines becoming less of an option, crude oil will likely be crossing the border by way of trains and trucks, which are far more prone to accidents.
Another consequence of canceling pipelines? More global reliance on OPEC. The oil embargoes of the 1970s should remind us how that plays out.
After years of energy security brought on by the American shale boom, it makes little sense to step back from building pipelines and give OPEC and Russia even more control over world oil markets. The International Energy Agency (IEA) is already calling on the cartel to ramp up crude supplies through March 2022 to meet demand. The U.S. would have been able to step in to fill those supply gaps if not for the White House policies that seek to punish fossil fuel companies. Prices are on the rise as well, as the world gets back to normal after more than a year of dealing with the Covid 19 pandemic.
The cancelation of Keystone XL may have enormous implications for how other pipeline projects may fare during the Biden Administration. While TC Energy did everything it could to ensure it met the demands of all relevant parties, even committing to net-zero emissions throughout its lifetime, the Keystone project still got the ax. However, President Biden has declined to wade into the debate over controversial pipelines already operating, such as Line 5 or Dakota Access. These actions suggest that while the President may not close existing pipelines, new ones will not be approved. Additionally, funding for new pipelines is not mentioned in the administration’s $2 trillion infrastructure plan.
Of course we need to continue cutting emissions, but handcuffing the oil and gas industry is not the answer. Pipelines are the safest way to transport oil and natural gas supplies and ensure energy security. America should lead the way, not disappoint our allies and cancel lucrative jobs. Unfortunately, if the trend of canceling pipeline projects continues, the missed opportunity of the Keystone pipeline may just be the tip of the iceberg.