The Pipeline of Strife

Barack Obama must soon decide whether to give the green light to the controversial project to build the Keystone XL pipeline, designed to carry Albertan oil to refineries in Texas. The stakes are high and not easily reconcilable.

Somewhere between economy and environment lies the heart of Barack Obama’s balance. The pressure is high for a “yes” from Washington for the TransCanada project. Canada, the main trading partner of the United States, has already signified that a refusal would be taken poorly, threatening Washington with trade retaliation. Ottawa has invested more than $100 billion in oil sands over the last 10 years, which makes the Keystone XL project vital for the prosperity of Canada, particularly for Alberta, which hopes to double its production of oil by 2025 to 3.7 million barrels per day.

But the pressure also comes from the inside. According to a Harris Interactive poll, 69 percent of Americans approve of the construction of the pipeline. Project proponents argue it would be in the interest of energy security and economic growth in the United States. The Republicans obviously support this project of $7 billion and 20,000 jobs, but they are not alone. Some elected Democrats and pro-jobs unions are also of the opinion that this initiative would help reduce unemployment, likely the largest challenge to the United States.

In contrast, environmental groups, who gave their support to Obama in the last election, resolutely await the decision from the White House. Environmentalists strongly oppose a project that would only contribute to the explosion of greenhouse gas emissions, in addition to involving significant risks of leakage. The oil from the oil sands is more corrosive and more viscous than conventional oil, which increases the risk of ruptured pipelines, environmentalists warn.

Obama is sensitive to environmental discourse. He himself advocated the urgency of the fight against global warming twice in recent weeks. He knows he would suffer an extraordinary lack of credibility if he gave his approval to the TransCanada project.

In the short term, the Keystone XL project would pay off for the United States. In the longer term, it is a different story. By authorizing the TransCanada project, Washington would increase its dependence on “dirty” oil for decades to come and contribute to the expansion of one of the most polluting industries in the world. Considering the astronomical environmental costs of climate change, I’m not sure if the Keystone XL project would be as profitable as its champions claim.