By

Alain Sherter /

MoneyWatch/ January 19, 2012, 7:00 AM

Keystone pipeline: How many jobs really at stake?

President Obama's move Wednesday to reject a permit to build the Keystone XL pipeline drew fire from supporters of the project, with a spokesman for House Speaker John Boehner telling CBS that the decision threatens to "destroy tens of thousands of American jobs."

Yet exactly how much work Keystone, a proposed 1,700-mile pipeline that would transport oil from Alberta, Canada, to the Texas Gulf Coast, would generate remains in dispute. Transcanada (TRP), the energy giant bidding to build the pipeline, projects the undertaking would create 20,000 jobs in the U.S., including 13,000 positions in construction and 7,000 in manufacturing.

That figure, based on a report by a consulting firm hired by Transcanada to assess the project's economic impact, has been widely cited by Keystone backers on Capitol Hill. Other estimates advanced by supporters of the pipeline have been even more optimistic, with the U.S. Chamber of Commerce claiming it could create 250,000 permanent U.S. jobs. 

Obama denies Keystone XL permit
Official: White House to nix US-Canada pipeline
Transcanada: New route for pipeline nearly done

But subsequent analysis suggests that Keystone's job-creating potential is more modest. The U.S. State Department calculated last year that the underground pipeline would add 5,000 to 6,000 U.S. jobs. One independent review of Keystone puts that number even lower, with the Cornell University Global Labor Institute finding that the pipeline would add only 500 to 1,400 temporary construction jobs. The authors of the September report also said that much of the new employment stemming from Keystone would be outside the U.S.

Transcanada itself cast doubt on its employment forecast when a vice president for the company told CNN last fall that the 20,000 jobs Keystone would create were temporary and that the project would likely yield only "hundreds" of permanent positions.

Another reason for the discrepancy appears to stem from what that 20,000 figure really means. As Transcanada has conceded, its estimate counted up "job years" spent on the project, not jobs. In other words, the company was counting a single construction worker who worked for two years on Keystone as two jobs, lending fuel to critics who said advocates of the pipeline were overstating its benefits.

The Cornell researchers concluded:

The construction of KXL will create far fewer jobs in the U.S. than its proponents have claimed and may actually destroy more jobs than it generates....

The claim that KXL will create 20,000 direct construction and manufacturing jobs in the U.S. is unsubstantiated. There is strong evidence to suggest that a large portion of the primary material input for KXL -- steel pipe -- will not even be produced in the U.S.


In a statement, President Obama attributed the decision to block construction of the pipeline to "the rushed and arbitrary deadline insisted on by Congressional Republicans," saying it "prevented a full assessment of the pipeline's impact, especially the health and safety of the American people, as well as our environment."

The furor is likely to continue, highlighting the intense election-year politics around Keystone. In urging Obama to approve the project, for instance, Boehner said on Wednesday that the pipeline would create 100,000 new jobs.

© 2012 CBS Interactive Inc.. All Rights Reserved.
17 Comments Add a Comment
linkicon reporticon emailicon
modelx08 says:
I SAY LETS DO THIS!!!!!!
reply
linkicon reporticon emailicon
mickey1111111111 says:
4truthjusticeATAW
legalizing marijuana will create more jobs and more taxes
going to school and retrain on jobs that are on demand today would also help but the keystone pipeline is not the answer
reply
linkicon reporticon emailicon
HowardJanet says:
A coworker of mine recently published an article about why people should oppose the keystone pipeline and how it will affect the country. You can read it here. http://myadvo.us/z2OUSu
reply
linkicon reporticon emailicon
HowardJanet says:
Once again, the President has placed our true national interest—the health and safety of citizens, our drinking water, our air, and our lands—above the interests of Big Oil. The decision also affirms the President's commitment to a cleaner and more secure energy future.

Those of us living in DC and key electoral battleground states know just how much Big Oil cared about this decision. We were inundated in the last few weeks with more than $600,000 worth of American Petroleum Institute ads declaring that the pipeline is in the country's national interest.
reply
SirGareth replies:
linkicon reporticon emailicon
How is the national interests of the USA preseved by reverting to a pre-industrail society?

As I recall, before we had affordable energy (which is of no concern to the leftist politcal tryants who buy all of the oil they want and bill it to the taxpayer); is Moochele Obama worried that the taxpayera might not pay for her scores of taxpayer funded megaton oil consuming vacation junkets?

In the pre-industrial age the Indians had no cheap enegy and could not process their wastes so they fouled their water and moved on.

Is this Obama's plan?

The average life span of a pre-industrial man was about 40 years; the only place its lower than this in the USA today is in the ruins of the Democrat control wastland cities like Detriot and Philly.

Those of you living in Washington DC are part of the parasite society who have no idea of how the money you steal from productive America is generated. You are the enemy within - If Iran nuked you it would be doing the nation a favor - Washington the city that takes half of our cash but produced the most vile BS to ever destroy a nation - this is the real pollution
linkicon reporticon emailicon
rbindc says:
ATAW,

Your call for us to develop our oil resources implies that somehow American citizens will benefit from this. Not likely and not much.

When an oil company (whether US or foreign-owned) produces oil on US land it sells that oil at the world price, which is set by the OPEC cartel. American motorists don't benefit from that oil production, just because it is US-sourced, because the price of gasoline and other refined products are determined by the world oil price. The oil company makes huge profits while the US citizens are left with a smaller resource base of oil for future development.

What we could do is make US citizens a silent partner with any oil company producing our oil. We could do this by including in the auctions for oil tracts a requirement for the purchasing company to rebate to the federal government 50% of the profits it earns from that tract. That's about the only way to align oil company profits with the interests of average Americans who are not sitting on big stock portfolios like to top one percent fat cats.

And before you launch into a knee-jerk diatribe, let me just say that if doing something that benefits ALL of our citizens is labeled SOCIALISM, so be it.
reply
SirGareth replies:
linkicon reporticon emailicon
Wow great plan - Mexico did this in the 1930's and thats why their economy really has had the jump on us ever since.

There they have an avalance of stupid peasants that beleive communism kinda works - Our goverment union schools are trying their best to duplicate the stupidity of the Mexican peasants - we're well on our way now.
linkicon reporticon emailicon
Darr247 says:
If you saw the mess the Enbridge pipeline made in Michigan when they dumped 1.5+ million gallons of crude into the Kalamazoo River (of course, Enbridge claims it was "only" 750,000 gallons), you would question their ability to safely put/run a pipeline ANYwhere.

I would much rather see a pipeline run across Canada to bring natural gas down to the USA from our North Slope wells, instead of just flaring it off like they do now (completely wasting it) while the oil companies pump out crude from the same wells to load onto tankers. A natural gas pipeliine would create just as many jobs as Keystone XL, and would eliminate the alleged "need" to risk polluting our aquifers by 'fracking' for NG, while simultaneously helping to lower the price of a fuel that's cleaner-burning-than-coal (most non-renewables electric-generating plants built in the last 20 years burn NG, not coal).

The false threat to export the oil-sands elsewhere is a red herring, because actually the pipeline to Canada's west coast was planned to be built BEFORE Keystone XL anyway, and would be required for the Keystone XL pipeline to even function. The Alberta-to-BC pipeline will be a twin run, with the westbound pipe carrying diluted oil-sands, and the eastbound pipe carrying water to dilute the oil-sands, making the sludge pumpable. Part of that water was also going to dilute the Keystone XL's oil-sands, so not building Keystone XL will just mean they don't have to pump as much water east.

The anti-liberals (they are _not_ "conservatives" and couldn't accurately define what a conservative is if you provided them with a dictionary) should learn to do a little data-mining of their own on a subject before blindly parroting the FauxNewz-foreign-national-meddler's, and/or the oxycontin-addict's, anti-social propaganda.
reply
bestplaceonearth replies:
linkicon reporticon emailicon
I agree Darr, we absolutely should build the natural gas pipeline, in addition to the Keystone. And thx for confirming that pipelines are "allowed" in western Canada, helping correct the nonsense below. The average US failure rate is 0.13 per 1000 miles per year. Taken across our 500,000 miles of pipelines the falure rate is still a very small number, especially considering that much of our collective wealth and ability to afford the great society we live in is based on a hydrocarbon economy. And before you go there, alternate energy is decades away from replacing our hydrocarbon-based economy, believe me I've worked in traditional and alternate energy for much of my career, primarily in R&D, and know what's feasible. BTW -- could have done without the name-calling at the end...
SirGareth replies:
linkicon reporticon emailicon
If you really want to see the most vile pollution to ever destroy a state look to the leftist political pollution that has destroyed the entire rust belt (every decaying city a monument to leftist causes).

The red states have no rust belts, no vile political pollution. Why are they thriving while the rust belt Democrats states are toxic
linkicon reporticon emailicon
tsigili says:
Perhaps the issue is.....not only are a significant number of jobs involved, but it is a step towards energy independence, where we stop buying oil from the middle east, and funding our enemies!
reply
sjc_1 replies:
linkicon reporticon emailicon
We buy less than 10% of our oil from the middle east. If we started building and operating synthetic fuel plants turning natural gas into gasoline, we could eliminate 10% of our imported oil altogether.
linkicon reporticon emailicon
sjc_1 says:
The Canadian west coast will not allow pipelines nor refineries, so they want to bisect the U.S. with a leaking pipe, leave the refinery pollution in the Gulf and ship the final product around the world from our shores.

The Republicans want you to believe that this is all in the best interests of the American people with no provisions that ANY of the fuel will stay in the U.S. What a con job and people keep falling for all of this bull.
reply
bestplaceonearth replies:
linkicon reporticon emailicon
Sorry SJC British Columbia has 2 oil refiners: Burnaby Refinery, Burnaby, (Chevron Corporation), 52,000 bbl/d and Prince George Refinery, Prince George, (Husky Energy), 12,000 bbl/d. You might try some facts to persuade people but then again maybe you're satisfied with simply serving as a repeating station for nonsensical blowback from your liberal fellow travelers...
linkicon reporticon emailicon
charliediana says:
You talk of the jobs created from the building of the Keystone XL, saying that the jobs would be only in the construction field, I beg to differ with you.

When a pipeline construction company moves into an area to start laying pipe:
They have to rent an area for their warehouse, equipment yards, and pipe yards. They then use as many local businesses as possible to stock their warehouse. (Pipelaying is not just big equipment but the thousands of items used daily by their employees) I know not all of these items are made in America but a very large portion are. Here you need to contact a Parts Man for one of the major contractors and they can give you a very good ides.
The people who are employeed by the construction company move into the area: they pay rent, they buy groceries, they eat out, they have to have all the necessities that everyone else does, they are usually still paying bills for their homes where they actually live. You are looking at anywhere from 200 to 500 people moving into an area. Looks like extra income for somebody to me.

You say they are only temporary jobs, tell that to a family that has no income and can go to work even temporarly and put food on their table or pay their rent.
reply
linkicon reporticon emailicon
bestplaceonearth says:
One additional thought... President Obama said "The rushed and arbitrary deadline insisted on by Congressional Republicans prevented a full assessment of the pipeline's impact..." If he felt rushed by the end-February deadline, why didn't he at least take the extra 5-6 weeks time to "assess" and then annoucne he didn't have time? Seems like he had his mind made up and didn't even bother taking the 2 months he had to consider this important jobs creating project.
reply
See all 17 Comments