Senate Rejection of Keystone XL Measure Sets Up 2015 Showdown

Keystone XL pipeline backers came up one vote short in the Senate and vowed to try again in January, when they expect to have enough support to send a bill to President Barack Obama.

The 59-41 vote yesterday to approve the pipeline fell below the 60 needed, despite pressure from co-sponsor and Louisiana Democrat Mary Landrieu, who spent days cajoling colleagues to back the legislation to boost her re-election odds.

Next year’s vote promises to be different when Republicans take control of the chamber with at least eight more members. That could be enough to win passage though short of the 67 needed to overcome a presidential veto without significant Democratic defections.

“We’ll do it next year,” said Senator Mitch McConnell of Kentucky, who is poised to be majority leader when Republicans take control in January. House Speaker John Boehner, an Ohio Republican, also has said enactment of a Keystone measure is a top priority; his chamber passed the measure last week.

Since TransCanada Corp., a Calgary-based pipeline maker, first applied to build Keystone in September 2008, it has become a proxy in a broader debate over jobs, U.S. energy security and climate change. Keystone XL would have the capacity to carry 830,000 barrels of oil a day, connecting Alberta’s oil sands to the U.S. Gulf Coast.

14 Democrats

All 45 Senate Republicans voted for the bill, joined by 14 Democrats. Next year, Republicans will have 54 members if Landrieu loses her race to Republican Representative Bill Cassidy, who is leading in polls.

In a separate vote, senators also failed to advance legislation that would have limited the National Security Agency’s ability to collect bulk phone records, making it unlikely to pass this year.

Next year the odds improve for Keystone backers. Four Democrats who have opposed the project will be replaced by four Republicans who support it: incoming Senators Joni Ernst of Iowa, Cory Gardner of Colorado, Mike Rounds of South Dakota and Shelley Moore Capito of West Virginia. If Landrieu loses a runoff Dec. 6, she will be replaced by Cassidy, who sponsored the House measure on Keystone.

In that case, Republicans would need support from 13 Democrats to override a veto.

Four of the Democrats who voted for the Keystone bill yesterday lost their re-election bids earlier this month.

Decision Limbo

Obama, meanwhile, faces no deadline to decide, meaning Keystone could remain in limbo into the next election.

The State Department, which has jurisdiction over cross-border projects, is reviewing whether the pipeline is in the national interest. Its evaluation has been delayed as it awaits a court decision in Nebraska that will determine the legality of the proposed route across that state.

Obama stopped short of threatening to veto yesterday’s bill, though he said he opposed it and favored letting the review proceed.

Last week he offered his harshest comments yet about the project, saying it would carry Canadian oil for export to markets outside the U.S. and wouldn’t create many long-term jobs.

He hasn’t said he opposes the project though.

“We’re more confident than ever that this pipeline will never be built,” said Tiernan Sittenfeld, senior vice president of the League of Conservation Voters, an environmental group.

TransCanada Reaction

Russ Girling, president and chief executive officer of TransCanada, said there is growing support for the project revealed in the votes in Congress.

“We will continue to push for reason over gridlock, common sense over symbolism and solid science over rhetoric to approve Keystone XL and unlock its benefits for America,” Girling said in an e-mail.

Some analysts said they see some potential for compromise in broader energy legislation that includes some Democratic priorities, like support for energy efficiency or wind and solar power tax credits.

“If they play their cards right and work with Democrats to overcome any concerns,” Republicans could pass a bill, said Jim Manley, a former spokesman for Senate Majority Leader Harry Reid of Nevada. “I’m not sure they want the policy. They may in fact be more interested in the issue.”

Alternatively, Republicans also could try to force Obama’s hand and attach the measure to “must-pass” spending bills, said Paul Bledsoe, a former climate change adviser to President Bill Clinton.

Pipeline’s Support

Some Republican strategists say party leaders have little reason to compromise given the broad support the pipeline among voters. A USA Today poll released Nov. 17 found more than 60 percent of Americans support the project.

“I don’t think there’s any chance Republicans are going to want to negotiate over Keystone,” said Ron Bonjean, a former Republican congressional staff member and political consultant. “They aren’t going to want to give him anything for it. It shows that he represents gridlock in Washington.”

Karen Harbert, president of the U.S. Chamber of Commerce’s Institute for 21st Century Energy, said in a statement, “There have been no indications that the Obama administration will stop ignoring the vast majority of Americans that support the pipeline, but we do know that Keystone will have even stronger support in the next Congress.”

Legacy Issue

Barry Rabe, a University of Michigan political science professor, said Obama may not want to compromise either, particularly on an issue that’s become linked to climate change which the president seems to view as a legacy issue.

“He’s had it pretty rough in Congress for a number of years now,” Rabe said in a phone interview. “It’s not clear what extending an olive branch would entail.”

While energy analysts say in many ways the oil producers have moved on, pushing other pipelines and sending more crude on rail lines, Keystone remains a political touchstone and a priority for Republicans and some oil-patch Democrats.

“The time is now to build the infrastructure to make America energy independent,” Landrieu said as she wrapped up her arguments for Keystone.

Senator Dianne Feinstein, a California Democrat, said Keystone presents “terrible environmental hazards and risks” and wasn’t needed.

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