US refiners, petchems urge Congress to OK Keystone XL pipeline

16 April 2013 19:20  [Source: ICIS news]

WASHINGTON (ICIS)--US refining and petrochemical interests on Tuesday urged Congress to adopt legislation that would fast-track federal permits for the Keystone XL pipeline, saying the project would strengthen US energy supplies and spur jobs growth.

Charles Drevna, president of the American Fuel & Petrochemical Manufacturers (AFPM) said the trade group “strongly urges approval of the Keystone XL pipeline and fully supports HR-3”.

That bill, the “Northern Route Approval Act” (NoRA), would authorise various US federal agencies with jurisdiction over the pipeline and its route to immediately approve existing environmental impact appraisals and other permits so that work on the project can begin.

Pending since 2008, the 1,700-mile (2,700 km), $7bn (€5.4bn) project would involve building a 36-inch (91 cm) pipeline across five US states, bringing crude to refineries in the US Midwest as well as Texas and providing refined products to another half-dozen states.

The project is subject to US State Department approval because it crosses the US-Canada international border, and it also falls under the jurisdiction of the Department of the Interior, the Environmental Protection Agency (EPA) and the US Army Corps of Engineers, among others.

In January last year, President Barack Obama rejected a Keystone XL approval mandate passed by Congress, saying that the decision on whether to give final approval to the project needed full consideration.

HR-3 is essentially another effort by project-backers in Congress to get the pipeline approved and construction started.

Testifying in support of the bill before the House Committee on Natural Resources, Drevna said that AFPM and its members “strongly support and urge the immediate approval of the Keystone XL pipeline as a means to increasing our nation’s energy supply and enhancing national security”.

HR-3, said Drevna, “would clear any remaining roadblocks and approve construction of the pipeline that has been extensively studied and reviewed since 2008”.

He argued that completion of the Keystone XL project would bring an additional 830,000 bbls/day of crude oil capacity from Canada, making the US less dependent on less reliable foreign oil suppliers.

Drevna also said that the project would generate more than $20bn in pipeline-related capital investment and other spending in the US and create more than 20,000 manufacturing and construction jobs during the build-out. 

When the pipeline is completed, the additional supply of crude feedstock also would drive refining and petrochemical development that in turn would generate further jobs growth, he said.

The Keystone XL project is broadly opposed by environmentalists who contend that the pipeline will endanger wildlife along its course and greatly increase the risk of pipeline ruptures and oil spills.

HR-3 is likely to win approval by the Republican-controlled House of Representatives, and 17 Democrat senators joined 45 Republicans in the Senate last month to vote 62-37 in favour of the pipeline project.

While the House bill and the Senate approval vote would not be binding on Obama and the State Department, the two demonstrations of strong bipartisan congressional support for the pipeline project could help sway the White House.

($1 = €0.77)

Paul Hodges studies key influences shaping the chemical industry in Chemicals and the Economy


By: Joe Kamalick
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