KEYSTONE XL:

House panel approves bill overriding Obama's pipeline veto

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A bill giving the Federal Energy Regulatory Commission 30 days to sign off on the Keystone XL pipeline is headed to the House floor after clearing a key panel today, 33-20, with three Democrats and all but one Republican voting in favor.

The Energy and Commerce Committee advanced the proposal by Rep. Lee Terry (R-Neb.) to override President Obama's rejection of the $7 billion project after dismissing five Democratic amendments, including a ban on the export of crude shipped through the XL link and a mandate that at least three-quarters of the steel used to construct it be manufactured in North America. Democrats Mike Ross of Arkansas, John Barrow of Georgia and Jim Matheson of Utah voted with the GOP, while Republican Charlie Bass of New Hampshire voted with the minority.

Today's vote paves the way for the full House to take up the Terry measure next week as part of a long-term transportation bill, although that broader legislation could yet stall amid thanks to nascent opposition from conservatives.

Before that fight is waged, however, partisan tussling continued over the benefits that Republicans and the oil industry promise would accrue to U.S. consumers if Keystone XL were built. The biggest tensions flared over Rep. Ed Markey's (D-Mass.) bid to block export of the Canadian oil sands crude that the pipeline would carry, as Republicans questioned the downside of sending the oil to other countries after American workers refine it.

"So what if the crude oil goes on the world market?" Rep. John Shimkus (R-Ill.) asked today. "Don't we understand commodity products? The more supply on the world market, the lower the price, if demand stays the same."

In fact, the projection that Americans would see lower gasoline prices from the pipeline rests on a series of complex variables -- including Gulf Coast refiners' ability to respond to lower profit margins as regional crude costs shift -- and is not guaranteed, even by oil industry analysts (Greenwire, Jan. 31).

Markey's defeated amendment did provide lawmakers a rare moment of levity, as Rep. Joe Barton (R-Texas) asked the Massachusetts Democrat whether he would impose a similar restriction on the desserts he sold at Fenway Park during his younger years.

"Did you only sell ice cream to people who said, 'I'm going to eat it in front of you right now'?" Barton quipped, to which Markey shot back: "I had an 'Eat in the United States' rule. You had to eat it in Red Sox Nation."

Steel and eminent domain

Among other Democratic amendments defeated today were a proposal from Rep. Mike Doyle (D-Pa.) to ensure that U.S. steelmakers benefited more strongly from the project and a plan from Rep. Bobby Rush (D-Ill.) to prevent sponsor TransCanada Corp. from using eminent domain powers against landowners along the pipeline's path.

"I don't believe there to be one ounce" of U.S.-made steel set aside for the pipeline, Doyle said today. While Republicans countered that layoffs are already occurring at an Arkansas facility thanks to the rejection of Keystone XL, Doyle noted that the company in question used Indian rather than U.S.-made metal.

Yet the Doyle amendment exposed political fault lines that have long threatened to undercut environmentalists' victorious lobbying effort against Keystone XL, which they oppose due to the high emissions generated by oil sands crude development.

The Pennsylvanian was one of several Democrats who said today that were it not for the GOP push to punch back at Obama's rejection of the pipeline, they would support its eventual construction.

"We can benefit from the pipeline, but I want it done right," Rep. Eliot Engel (D-N.Y.) said.

Bass, the lone Republican to vote against the Terry legislation, was one of three majority-party members to oppose a July bill that would have fast-tracked a decision on the pipeline.

Other amendments

In addition to rejecting the Markey, Doyle and Rush amendments largely along party lines, the Energy and Commerce Committee also beat back a proposal from Rep. Anna Eshoo (D-Calif.) that would have postponed a FERC decision on the XL line until federal pipeline safety regulators complete a study of the risks of Canadian oil sands crude.

Another Democratic amendment turned down, from Rep. John Dingell of Michigan, would have codified the executive order that originally gave President Obama's administration the power to review and reject the project.

The lone amendment approved, offered by Terry, further strengthened the bill's pro-pipeline thrust by preventing FERC from attaching any additional conditions beyond the several dozen already agreed to as part of the administration's environmental review process.