Rep. Barton says State Department reasoning an “insult” to America

A top State Department official defended the Obama administration’s rationale for denying a permit for the Keystone XL oil pipeline against attacks on Wednesday from Republicans who say the decision was politically motivated and cost jobs.

Assistant Secretary of State Kerri-Ann Jones, the point person on Keystone XL, said a Feb. 21 decision deadline imposed by Congress didn’t provide the department enough time to assess alternative routes avoiding the environmentally sensitive Sandhills region of Nebraska, which is home to a drinking-water aquifer.

“Without that information we’d also not be able to look at other factors, socioeconomic factors, environmental factors, as well as foreign policy and energy security,” Jones told the House Energy and Commerce and Committee’s Energy and Power Subcommittee. “It was not based on the merits of the project.”

Obama has said he agreed and let the department deny the permit. TransCanada Corp. has said it will reapply.

Republican supporters of the pipeline from Canada’s tar-sands region to Gulf Coast refineries were angered with last week’s decision and they vowed to pursue legislation to ensure the pipeline gets built. At the tense hearing, they said the department, which has jurisdiction over border-crossing pipelines, had studied the pipeline for more than three years.

“We fought and won World War II in less time than it’s taken so far to evaluate this project,” Rep. Joe Barton, R-Ennis, told Jones. “With all due respect, it is an insult to the American people to say that you need more time.”

Republicans won the deadline in a deal last month to extend the payroll tax cut by two months. They say the pipeline would bring needed jobs and oil. Opponents say that the jobs claims are inflated and the pipeline poses pollution risks, and that it would reroute oil already imported from Canada for export after refining.

Republicans said the department’s environmental review of the pipeline from August raised few concerns. They noted the payroll tax law deemed no additional study was necessary and gave Nebraska enough time to plot a new route through the state.

But Jones said the review was done before residents raised concerns about the proposed route through the Sandhills.

“We listened to these views, many actually supportive of the pipeline but stressing that the route needed to be moved,” Jones said.

In November 2011, just days after 10,000 pipeline opponents encircled the White House in protest, the department decided to postpone the decision, originally expected by the end of the year, until early 2013 over those concerns. The Feb. 21 deadline for determining whether the pipeline serves the national interest “was not enough time to complete the work and the analysis needed … especially given that the route had not been finalized,” Jones said.

Under grilling from Rep. Michael Burgess, R-Lewisville, Jones said the White House didn’t influence the department’s recommendation.

But Republicans insisted the pipeline’s time has come.

The Terry Bill

Rep. Lee Terry, R-Neb., is sponsoring a bill giving a different agency, the Federal Energy Regulatory Commission, 30 days to approve the pipeline and deeming it approved if the body doesn’t act.

“It’s a false excuse for using state of Nebraska as the reason for the denial,” Terry said.

The bill faces narrow odds of becoming law, but some Republicans have said they could try tying Keystone provisions to other legislation, such as a longer-term extension of the payroll tax break.

Terry’s bill “imposes narrow time constraints and creates automatic mandates that prevent an informed decision,” Jones said in criticizing the proposal. “We also feel it overrides foreign-policy and national-security considerations implicated by a cross-border permit, which are properly assessed by the State Department.”

“The legislation raises serious questions about existing legal authorities,” she added in written testimony.

Jeffrey Wright, director of FERC’s Office of Energy Projects, warned his agency doesn’t have experience with siting of oil pipelines or authority over it. He added the timeline for FERC in Terry’s bill “does not allow sufficient time to build an adequate record to arrive at a defensible decision.”

Democrats, including some who support Keystone XL, blasted the bill.

House Energy and Commerce Ranking Member Henry Waxman, D-Calif., calling Keystone XL a GOP earmark, said even if it brings new oil to the U.S. it would still be vulnerable to price spikes resulting from supply shocks in the global oil market.

“We are here on another proverbial fishing expedition by the majority party again to slice up federal regulations and oversight to help industry get what they want, and the American public be damned in the process,” said Subcommittee Ranking Member Bobby Rush, D-Ill.

Rep. Gene Green, D-Houston, said he still supported Keystone XL but couldn’t support Terry’s bill.

“I don’t think we need to be rewriting a long-standing process over one pipeline,” Green said.

Rep. Charlie Gonzalez, D-San Antonio, said he feels “time is of the essence and we need to move forthwith, but not to rush it.” He said other committee members’ claim the pipeline would lower U.S. gasoline prices is false because some of the refined oil would go for export to the highest bidder.

The committee didn’t discuss a separate proposal from Rep. Ted Poe, R-Humble, who introduced a bill yesterday that would immediately approve the pipeline via Congress.

Present in the audience were several people donning referee uniforms, which some committee members took note of.

They may have been pipeline foes who took part yesterday in an anti-Keystone XL protest, in which environmental activists donning referee uniforms sought to “blow the whistle” on a Congress they feel is in the pocket of oil companies.

“We’re looking to have the ruling on the field confirmed again and again,” House Energy and Commerce Committee Chairman Fred Upton, R-Mich., joked in welcoming them to the room.

Mike Linder, director of Nebraska’s Department of Environmental Quality, was invited to appear at the hearing but was scratched at the last minute. Terry blamed the State Department, saying that it needlessly requested federal officials appear on their own panel and that House vote two hours into the hearing prevented the committee from having another panel with Linder.

The State Department said it’s a long-standing convention to have federal officials appear on their own panel, and the decision not to have Linder appear was the committee’s.