TransCanada Hustles to Revive Keystone XL After Trump's Executive Order
Updated at 4:12 p.m. ET
President Donald Trump signed executive orders Tuesday giving the green light for construction of the Keystone XL and Dakota Access pipelines, two projects that stalled under the Obama administration.
TransCanada (NYSE:TRP) first sought approval for its Keystone XL pipeline in 2008, but President Obama rejected its permit application in November 2015. Energy Transfer Partner’s (NYSE:ETP) Dakota Access Pipeline is already under construction. However, the Obama administration halted the project in late 2016 amid protests by environmental and Native American groups.
The executive order on Keystone XL invited TransCanada to resubmit its proposal and directed agencies to expedite the approval process. TransCanada later released a statement saying it has begun preparing the application.
“KXL creates thousands of well-paying construction jobs and would generate tens of millions of dollars in annual property taxes to counties along the route as well as more than $3 billion to the U.S. GDP,” the company said.
Another executive order signed on Tuesday says the U.S. Commerce Department will seek to maximize the use of U.S. steel in building the pipelines. Trump also moved to expedite the permitting process for related infrastructure projects.
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Both pipelines can move forward subject to a renegotiation of terms, according to Trump. During a briefing with reporters, White House spokesman Sean Spicer said Trump wants to get the “best deal” for American taxpayers and allow anyone with concerns to “come back to the table.”
The Keystone XL pipeline would connect the Canadian oil-sands region to Steele City, Neb., the meeting point of TransCanada’s existing Keystone and Cushing Extension pipelines. As a cross-border project, Keystone XL also requires approval from the State Department. During the campaign, then-GOP candidate Trump said, if elected, he would ask TransCanada to reapply for a construction permit.
In December, the U.S. Army Corps of Engineers said the disputed segment of the $3.8 billion Dakota Access Pipeline in North Dakota would need to be rerouted. Political observers expected the move to be challenged by President Trump once he took office. Energy Transfer Partners has pursued its own challenge in court, hoping to resume construction.
The company has completed roughly 87% of the 1,172-mile pipeline. The Dakota Access Pipeline would bring crude oil from North Dakota’s oil-rich Bakken shale play to southern Illinois, where oil can then be transported to Gulf Coast refineries using an existing pipeline.
“The President’s decision is a major victory for workers and American families who will benefit from the jobs and economic growth that will surely follow the new North American oil that the Keystone and Dakota Access pipelines are expected to deliver to U.S. Gulf Coast refineries,” said Nicholas K. Akins, CEO of American Electric Power (NYSE:AEP) and chair of the Business Roundtable’s committee on energy and environment.
Energy Transfer Partners didn’t immediately respond to FOX Business’ request for comment.