Today in Cushing, Oklahoma, President Obama said that his administration would get moving right now on the southern portion of the Keystone XL pipeline from Cushing to the Gulf Coast:
We’re making this new pipeline from Cushing to the Gulf a priority. We’re going to go ahead and get that done.
At the end of February, Transcanada Corp. (NYSE: TRP) said that it planned to complete the 423-mile long section of the pipeline by mid-2013 to carry 700,000 barrels/day. The company also plans to re-apply for permits to construct the longer portion of the pipeline from Alberta to Cushing once the pipe has been re-routed.
Obama is in a difficult spot, having gotten a lot of kudos from environmentalists for killing the Keystone XL in January, but now forced to admit what he knew all along — that the pipeline needs to be built. His other major problem is that the Keystone XL pipeline is not going to reduce gasoline prices in the US, unless by a small amount. The purpose of the pipeline is to raise the price of crude from Canada’s oil sands and the oil fields of North Dakota and Montana. His Republican opponents avoid talking about that even more than Obama does.
The President’s political opponents are hammering him for not taking steps to lower gasoline prices, so he has to do something. And building the southern leg of the Keystone XL pipeline qualifies as something.