Why Keystone XL Is Already a Boon to American Workers

By Energy FOXBusiness

(TransCanada)

The on-again, off-again Keystone XL pipeline has already fueled jobs in the U.S., and manufacturers like Siemens (SIEGY) are ready to put Americans to work if and when TransCanada (TRP) resurrects the project.

Continue Reading Below

TransCanada officially reapplied late Thursday for approval to restart construction of the pipeline, after earlier in the week President Trump signed executive orders to green light the project, which stalled under the Obama administration.

"This privately funded infrastructure project will help meet America's growing energy needs as well as create tens of thousands of well-paying jobs and generate substantial economic benefit throughout the U.S. and Canada," TransCanada CEO Russ Girling said in a statement.

The Keystone XL order directs the U.S. State Department to complete its review within 60 days of TransCanada’s submission of a permit application. The company’s initial permit application was denied by the Obama administration in 2015, seven years after TransCanada first sought approval.

While seeking a green light from the federal government, TransCanada spent more than $2 billion on pipe and other parts for Keystone XL. Many of those components were stored in warehouses, waiting for Keystone XL to become reality.

In the project’s early stages, TransCanada contracted German manufacturer Siemens to equip 35 pump stations with hundreds of components. Five U.S. plants in Ohio, Pennsylvania, Illinois, Mississippi and Texas produced motors, variable-speed drives, automation hardware and other equipment for Keystone XL. The products were shipped in 2014, according to Siemens.

Continue Reading Below

Welspun Tubular, a company that employs roughly 500 people at a factory in Little Rock, produced 700 miles of pipe for TransCanada. The project generated more than 600 factory jobs over an 18-month period, according to congressional testimony by CEO David J. Delie in 2013.

TransCanada still owns the pipe, the company confirmed to FOX Business. Given the regulatory delays, TransCanada has kept most of the pipe stored in Little Rock. Some of the pipe made by Welspun was used to construct another section of the Keystone system from Cushing, Okla., to Houston, Texas.

“Building the Keystone XL and Dakota Access pipelines will lower energy costs and create jobs across the country and in Arkansas at places like Welspun Tubular,” Sen. Tom Cotton (R-AR) said this week in a statement.

According to a State Department report from January 2014, Keystone XL—if completed—is expected to support the equivalent of about 42,100 total full-time jobs annually during the pipeline’s two-year construction phase. The project was pegged to put an estimated 16,100 workers into action through direct hiring, including 3,900 construction workers. The remaining jobs are considered indirect hires that result from related spending.

TransCanada has said Keystone XL, which is projected to cost as much as $10 billion, would support 9,000 construction jobs in the U.S.

The 1,179-mile pipeline would be an extension of an existing system that starts in Canada and runs south from North Dakota to the Gulf Coast in Texas. Keystone XL is designed to provide a direct route from the Canadian oil sands to Steele City, Neb. From there, oil can travel to refineries along the Gulf Coast.

More from FOX Business

What do you think?

Click the button below to comment on this article.