WSJ Distorts Facts to Promote Keystone XL Pipeline

Blog ››› ››› EMILEE PIERCE

In advance of Sunday's massive protest against the proposed Keystone XL pipeline, the Wall Street Journal's Collin Levy issued a flawed column, which regurgitates false claims in an effort to belittle the pipeline's opponents. Arguing that the pipeline would create "13,000 union jobs" and "another 118,000 spin-off jobs" -- without significant irreparable damage to the environment -- Levy asks: "who needs energy security or job creation when you have environmental activists?"

Say what? There are a number of problems here:

1. As we noted the last time the Journal tried to whitewash the Keystone XL pipeline, it's not credible to claim that the pipeline will create "13,000 union jobs and 118,000 spin-off jobs." These figures are drawn from a widely criticized study conducted by the Perryman Group and funded by the pipeline's owner, TransCanada. Further, they aren't even properly cited by the Journal.

The Perryman Group uses extremely opaque assumptions to conclude that the pipeline would result not in 118,000 jobs -- but in 118,935 "person-years of employment." Said differently, that's 118,000 temporary jobs lasting one-year.

Those projections are a lot higher than estimates arrived at by Cardno Entrix, a State Department contractor with financial ties to TransCanada, and the Cornell Global Labor Institute. In fact, the Cornell study - the only independent study not funded by TransCanada - found that the pipeline could actually destroy more jobs than it creates.

As Think Progress documents:

[Researchers at Cornell] find that between 500 and 1400 temporary construction jobs will be created, with a negative long-term economic impact as gas prices rise in the Midwest and environmental costs are borne.

Why this tremendous discrepancy? Examining TransCanada's business operations, the Cornell Global Labor Institute report finds that TransCanada has already purchased most of the steel it intends to use for the pipeline from India; that most of the work will be conducted by people already employed by TransCanada; and that the Perryman Group included already-completed pipeline projects in its job-creation estimates. [Think Progress, 11/4/11]

2. Several analyses - including one prepared for the Department of Energy - show that the Keystone XL pipeline will not reduce U.S. dependence on foreign oil. The pipeline's proponents stress that it will enhance energy security by reducing our reliance on oil from unstable regions, including the Middle East and Africa. But, as demonstrated in the report prepared for the DOE, "U.S. crude oil imports" from the Middle East, Africa, Canada and other countries are "insensitive" to "whether or not KXL is built."

Why? Because the vast majority of the tar sands oil to be transported from Canada to the Gulf Coast by way of the KXL pipeline won't be kept on American soil. Instead, much of it is expected to be exported overseas. As documented by the New York Times, six companies have "already contracted for three-quarters of the oil. Five are foreign, and the business model of the one American company -- Valero -- is geared toward export."

Indeed, Valero's September 2011 presentation to its investors clearly shows how the company plans to export diesel and jet fuel from its Gulf Coast refineries, while importing gasoline from its Pembroke refinery in the U.K.

3. There is strong evidence -- including TransCanada's abysmal safety record -- that the pipeline poses serious threats to public health. Citing an Environmental Impact Review conducted by Cardno Entrix for the State Department, Levy suggests there is no credible evidence that the pipeline would leak and even chides President Obama for "play[ing] to the fear" when he acknowledged on Omaha TV that Nebraskans wouldn't even want "extra jobs" "if it means our kids are potentially drinking water that would damage their health."

Formal investigations related to the State Department's use of Cardno Entrix aside, KXL will traverse 6 major Texas rivers, as well the Ogallala aquifer, which supplies water for twenty percent of U.S. irrigated farmland and more than 2 million people.

If TransCanada's record is any indicator, the chance of more than one spill is high. The first leg of TransCanada's Keystone pipeline system had 12 spills in its first 10 months of operation, prompting the U.S. Government to issue a Corrective Action Order and temporarily suspended the pipeline's operations. Six months earlier, the Hazardous Materials Safety Administration ordered TransCanada to dig up 10 sections of pipe after government-ordered tests indicated that defective steel may have been used. Keystone XL will use steel from the same Indian manufacturer.

Nationally, the record isn't much better. The New York Times reported that there are more than 100 significant oil pipeline spills annually "and the percentage of dangerous liquids recovered by pipeline operators after a spill has dropped considerably in recent years."

But who needs credible jobs estimates or important facts when you have The Wall Street Journal?

Posted In
Environment & Science, Energy
Wall Street Journal
Collin Levy
We've changed our commenting system to Disqus.
Instructions for signing up and claiming your comment history are located here.
Updated rules for commenting are here.