Obama ‘Out of Touch’ With Americans, Alberta Minister Says

U.S. President Barack Obama is “out of touch” with Americans for putting environmental concerns ahead of potential jobs and oil that could be supplied by a Canadian pipeline to the Gulf Coast, said Alberta Energy Minister Ron Liepert.

A proposed extension of TransCanada Corp. (TRP)’s C$13 billion ($13.3 billion) Keystone pipeline to the Gulf of Mexico has been delayed as the U.S. State Department considers whether to approve the project. The extension would transport 700,000 barrels of crude a day from Alberta and create thousands of jobs as it traverses six states, Liepert said.

“The American people spoke last fall that jobs trump everything else in this country right now,” Liepert said in an interview at Bloomberg headquarters in New York. “I would strongly encourage those elected and those in Cabinet positions to start to make some tough decisions on what the American people want, not necessarily what the administration is advocating for.”

TransCanada expects to directly employ 13,000 people to build the Keystone extension, Chief Executive Officer Rus Girling said on April 29. The project could contribute about $20 billion in economic stimulus for the U.S., he said.

Increased imports of oil from Alberta, along with expanding U.S. production of natural gas and opening areas currently off- limits to drilling, would contribute $194 billion in revenue for the U.S. government and create a million additional jobs over the next 15 years, the American Petroleum Institute said May 14.

Environmental Concerns

Alberta’s oil sands have been the focus of campaigns by environmental groups including Greenpeace that highlight the carbon emissions, water pollution and habitat destruction associated with production of oil from tar-like bitumen-soaked sand in the northern part of the Canadian province. U.S. residents in areas that would be crossed by the pipeline have opposed the project, citing concerns about environmental damage if the pipeline should leak.

“I think the administration today is highly influenced by the environmental movement, and there’s a lot of foot-dragging relative to the approval of projects that are seen to have, quote, environmental impact,” said Liepert.

A spokesman for the Obama administration did not immediately respond to a request for comment.

A revised environmental study issued April 15 by the State Department reaffirms support for the Keystone extension. Secretary of State Hillary Clinton said in October that the department was “inclined” to approve the pipeline. The State Department said last month it expects to decide by the end of the year.

Proposed Protection

In an effort to quell environmental criticism inside Canada, the province government on April 5 proposed a protection plan that would bar drilling on 20,000 square kilometers (7,722 square miles) of land, larger than the state of New Jersey, in the Lower Athabasca region in northeastern Alberta.

The province also has established an oil sands monitoring panel to make recommendations on how to protect the water, air and land of northeastern Alberta. The group, headed by a former TransCanada chief executive officer as well as a former president of the University of Lethbridge, will report its findings to the government next month.

Investment in the oil sands may rise to C$15 billion this year from C$13 billion in 2010, according to the Canadian Association of Petroleum Producers. It estimates reserves of 173 billion barrels of oil in the province based on current technology.

Alberta will likely win investment in the form of minority stakes from Chinese and other Asian companies as they seek energy security, Liepert said. Improvements in technology will likely boost production beyond the targeted 3 million barrels per day by 2020, he said.

To contact the reporters on this story: Jim Polson in New York at jpolson@bloomberg.net; Jeremy van Loon in Calgary at jvanloon@bloomberg.net

To contact the editor responsible for this story: Susan Warren at susanwarren@bloomberg.net.