Why the U.S. Government Needs to Approve the Pipeline Project
By Andrew Black
In the spring of 1829, a 20-year old Abraham Lincoln pushed off from the banks of the Ohio River on a flatboat full of produce and hogs. Joining him was friend Allen Gentry, son of a local merchant who had commissioned the two young men to deliver the cargo to market. Lincoln and his friend set off from Indiana, passing the new state of Illinois, created just nine years earlier, but still very much an isolated frontier land. Railroads would not come to the state for decades, and not a single road connected Illinois with any other state. The 200 people living 400 miles north on the shores of Lake Michigan would not form the town of Chicago for another four years.
Passing through these wilds, Lincoln and Gentry journeyed on the Ohio and Mississippi rivers 2,400 miles round-trip, to deliver and sell their cargo in New Orleans. Lincoln repeated the trip himself two years later, traveling this time from his newly adopted state of Illinois. As a teenager, Lincoln helped dig the Louisville and Portland Canal along the Ohio River. He earned money rowing people out to steamers in the river on a boat he built himself.
In all of these exploits, Lincoln learned the value of transportation infrastructure. As historian Doris Kearns Goodwin described in her Lincoln-era history, Team of Rivals, “Primitive roads, clogged waterways, lack of rail connections … were not merely issues to Lincoln, but hurdles he had worked all his life to overcome in order to earn an ampler share of freedom. These ‘improvements’ to the infrastructure would enable thousands of farming families to emerge from the kind of poverty in which the Lincoln family had been trapped, and would permit new cities and towns to flourish.”
In fact, “internal improvements,” as building infrastructure was known at the time, was a key campaign promise of Lincoln’s in his candidacy for state legislature. His 1832 announcement included this promise: “Time and experience have verified to a demonstration, the public utility of internal improvements. That the poorest and most thinly populated countries would be greatly benefitted by the opening of good roads, and in the clearing of navigable streams.”
Lincoln was a supporter of internal improvements legislation in the Illinois legislature, and spoke out as a U.S. Congressman against Democratic President James Polk’s veto of an internal improvements bill in 1846.
Polk’s veto of infrastructure improvement legislation was greeted harshly back in Chicago, now a growing city. Historian Michael Burlingame relays that “when news of the presidential veto reached Chicago, ships there lowered flags to half-mast, and a sandbar at the harbor’s entrance was christened ‘Mount Polk.’ Downed trees in rivers became known as ‘Polk stalks.’”
So, it is ironic that supports of President Barack Obama recently invoked President Lincoln as a symbol against transportation of oil sands-derived crude oil via the Keystone XL pipeline in a letter to the president on May 9. More than 150 wealthy donors to the president’s 2008 and 2012 campaigns noted Obama’s admiration for President Lincoln and his fight for the 13th Amendment. These supporters of the president believe his decision on Keystone XL “holds comparable urgency and importance, not strictly as a pipeline decision, but as a presidential choice that will signal a fundamentally new direction for our nation.”
As a student of our 16th president, Obama will be well-versed in Lincoln’s support for transportation infrastructure. In addition to support for water infrastructure early in his career, Lincoln was a great supporter of connecting the nation through rail infrastructure, signing legislation to encourage construction of the Transcontinental Railway. With the economic benefits of pipeline construction overwhelming, it is easy to imagine Lincoln as a strong supporter of new pipeline infrastructure.
Construction of the 1,179-mile Keystone XL pipeline to deliver Canadian crude oil to the United States will provide more than 42,000 U.S. jobs and $2.1 billion in U.S. worker payroll, as described in the Draft Supplemental Environmental Impact Statement (DSEIS). Notably, the Keystone XL project will support not only thousands of construction jobs, but also many thousands more manufacturing, professional and service jobs. States along the construction route will benefit from the Keystone XL pipeline, but so will nearly every state in the nation. Keystone XL will spur construction contract purchases of $3.1 billion, including $1.53 billion in construction activity, $750 million in materials purchases and $860 million in supporting construction management, inspecting and engineering activities.
Analysis of the project derived from economic modeling incorporating data from the U.S. Bureau of Economic Analysis, U.S. Bureau of Labor Statistics and the U.S. Census Bureau confirms the thousands of jobs and billions of dollars in payroll this project will generate. Of the 42,100 jobs Keystone XL will spur, more than 12,000 are from the four states the project will cross — Montana, North Dakota, South Dakota and Nebraska — and an additional 30,000 jobs are from states across the country. While Keystone XL will support 6,800 construction jobs with $420 million in payroll, it will also lead to 4,600 manufacturing jobs with $309 million in payroll, 4,400 jobs in trade with $172 million in payroll, 2,200 jobs in finance and insurance with $131 million in payroll, 5,100 jobs in other professional services with $343 million in payroll, 2,700 jobs in health services with $141 million in payroll, and 5,700 jobs in food and accommodations with $278 million in payroll.
Pipelines are the safest way to deliver crude oil and petroleum products compared to other modes of transportation. In 2012, pipelines transported more than 13.5 billion barrels of crude oil, gasoline, diesel and jet fuel across the United States. Of all of the crude and petroleum products delivered in 2012, 99.9996 percent of those barrels reached their destination safely. A study reviewed by the U.S. State Department considered miles traveled and volumes carried and found pipelines had an accident rate of 0.6 per billion ton-miles, while rail had an accident rate of 20.5 per billion ton-miles, more than 33 times higher than pipelines.
Overall pipeline safety performance continues to improve. Over the last 10 years, according to the operator managed Pipeline Performance Tracking System, the number of releases nationwide from onshore transmission pipelines are down 59 percent, and the number of barrels spilled are down 43 percent. Moreover, industry efforts addressing historic reasons for pipeline incidents have led to considerable safety improvements. Corrosion as the cause of pipeline incidents is down 76 percent over the last 10 years, third-party damage (such as a utility operator digging near a pipeline with a backhoe) is down 59 percent, operator error is down 53 percent, equipment failures are down 26 percent, and pipe material failures are down 23 percent. Substantial industry spending on pipeline safety shows pipeline operators are committed to ensuring the utmost safety. In 2011, pipeline operators spent more than $1.1 billion on pipeline integrity management programs to evaluate, inspect and manage their infrastructure networks.
American workers need the jobs the Keystone XL pipeline will provide. American consumers need the supply benefits the Keystone XL pipeline will provide. President Lincoln would have recognized these benefits and supported the Keystone XL pipeline. We hope President Obama does too.
Andrew Black is president and CEO of the Association of Oil Pipe Lines (www.aopl.org).