Commerce President and CEO Thomas Donohue

Chamber touts Keystone XL, domestic energy to create jobs

by Puneet Kollipara

Energy topped the U.S. Chamber of Commerce’s annual list of priorities for boosting the economy, as the group’s president urged approval of the Keystone XL pipeline and further exploitation of domestic oil, gas and coal resources.

Chamber President Tom Donohue called energy a “game changer” for the U.S. today in Washington in his annual State of American Business speech, which sets out priorities to boost the economy. For 2012 Donohue also suggested stopping an “avalanche” of energy and business regulations, reforming Social Security and Medicare, boost intellectual property protections and using other policies that can promote growth “without raising taxes or adding to the deficit.”

He said the nation could create more than 1 million jobs by 2018 developing oil, natural gas and coal — a claim promoted by the American Petroleum Institute (but decried by a top Democratic lawmaker). Pointing to the oil boom in North Dakota, where unemployment has fallen below 4 percent, he said the U.S. “is on the cusp of an energy boom that is already creating hundreds of thousands of jobs, revitalizing entire communities and reinvigorating American manufacturing.”

To tap those resources, the U.S. should “speed up permitting and end many of the restrictions that have put key areas off-limits,” he said, though he didn’t give examples. He said the nation should harness both conventional and alternative sources and expand efficiency and nuclear power.

He also urged the Obama administration to approve TransCanada’s Keystone XL pipeline that would carry tar-sands oil from Alberta, Canada to refineries in the Gulf Coast . Like other supporters, Donohue said its construction would create 20,000 jobs and more down the road, and the 1,700-mile pipeline would provide energy from a friendly neighbor.

“The project has passed every environmental test,” Donohue said, adding that some labor unions have been “screaming” in support of it. “There is no legitimate reason, none at all, to subject it to further delays.”.

Donohue’s remarks add to rising pressure from industry and Republican supporters on Obama to approve Keystone XL as a Feb. 21 deadline imposed by Congress for a decision approaches. The pipeline has posed a political dilemma to the administration, whose decision will surely anger some of Obama’s supporters: environmental groups and many Democratic fundraisers who oppose Keystone XL, or some labor groups that support it.

The State Department delayed a decision on the pipeline in November until early 2013, citing the need to study alternative routes taking the pipeline away from an critical aquifer in Nebraska. The decision also deferred the politically challenging decision until after the 2012 election. The State Department, which has authority because the pipeline would cross an international border, warned that the arbitrary deadline wouldn’t provide enough time for the study, required by the law, perhaps dooming the project.

Pipeline opponents contend the pipeline would create at most 6,000 temporary and few permanent jobs, while promoting dirty tar sands oil that poses a high pollution risk and could be exported by Gulf refiners. Opponents also cite a government analysis in saying the pipeline wouldn’t affect U.S. oil imports from Canada.

They sought to upstage Donohue the night before he even gave his speech.

Jeremy Symons with the National Wildlife Federation, a conservation advocacy group, cited those claims in blasting Donohue and the Chamber for supporting the “Keystone XL scam.”

He accused the Chamber of being “taken over by the biggest oil companies with the deepest pockets.”

“It really has nothing to do with jobs and everything to do with our rights to protect our water and our lands,” Symons told reporters in a conference call yesterday.

Donohue told reporters after his speech he wasn’t surprised about what environmentalists were saying.

“It is really a very hard argument to make that the [Keystone] XL pipeline is not a sound thing to do,” Donohue said.

“They’re safe, they’re environmentally friendly, and I’d rather have the oil here than have it go to Asia,” Donohue added, seemingly alluding to a TransCanada executive’s suggestion the company might look to Asian markets if Keystone XL is rejected.

The back-and-forth over the speech adds to separate ongoing debate among stakeholders.

“It will indeed be an election issue, API President Jack Gerard told reporters this year in warning of major consequences for Obama if the administration rejects Keystone XL. API has launched a pro-Keystone XL television ad in six Midwestern states and the District of Columbia.

On Wednesday, House Energy and Commerce Committee Chairman Fred Upton, R-Mich., pointed to Iran’s threats to cut off the Strait of Hormuz, a path for transporting one-fifth of the world’s oil, in arguing Keystone XL “will guarantee America has a secure energy source despite attempts to cut off supplies by hostile nations.”

The Natural Resources Defense Council, an environmental group opposing Keystone XL, has rejected that argument as flawed, saying that prices on imported oil are governed by global market forces.

“That’s not really what this debate is about,” Anthony Swift, staff attorney with NRDC, said in a recent interview.

Swift has said additional tar-sands capacity won’t come online quick enough to address any supply shock Iran creates. And pointing to a government study, he said the Keystone XL pipeline won’t affect U.S. imports from Canada through at least 2030.

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