Despite Trump Pledge, No Requirement for U.S. Steel in KeystoneBy
Made-in-America directive won’t apply, White House says
Trump told U.S. Steel CEO project would use American steel
The Keystone XL pipeline won’t be required to use American-made steel to earn construction approval from the Trump administration, the White House said Friday, despite President Donald Trump’s repeated claims.
The president’s executive order mandating the use of U.S. steel is “specific to new pipelines or those that are being repaired,” White House spokeswoman Sarah Sanders told reporters aboard Air Force One on Friday.
“Since this one is already current, under construction, the steel is already literally sitting there, it would be hard to go back,” she said.
That’s welcome news to TransCanada Corp. as its moves forward with the $8 billion project. The pipeline would span 1,179 miles (1,897 kilometers) from Alberta through three states -- Montana, South Dakota, and Nebraska -- before connecting to an existing network feeding crude to U.S. Gulf Coast refineries. The line would carry as much as 830,000 barrels of oil a day, including some from North Dakota’s Bakken shale.
In 2012, the company said it expected half of the 821,000 tons of steel needed to construct the pipeline to be produced inside of the United States. The remainder of the steel was expected to be imported from Canada, Italy, and India.
But exempting Keystone XL from the president’s requirement to use American steel would seem to fly in the face of Trump’s public comments. Trump has repeatedly boasted that he forced pipeline companies to agree to use U.S. steel in their projects.
During a Feb. 23 meeting with manufacturing CEOs at the White House, Trump told U.S. Steel Corp chief executive Mario Longhi that “the pipe is coming from the U.S.” for the Keystone project, as well as Energy Transfer Partners LP’s Dakota Access pipeline.
“We put you heavy into the pipeline business because we approved, as you know, the Keystone Pipeline and Dakota,” Trump told Longhi. “But they have to buy -- meaning, steel, so I’ll say U.S. Steel -- but steel made in this country and pipelines made in this country.”
During a Feb. 16 press conference, the president said that in exchange for using “the powers of government to make that pipeline happen” the administration “want them to use American steel.”
“And they’re willing to do that, but nobody ever asked before I came along,” he said. “Even this order was drawn and they didn’t say that. And I’m reading the order, I’m saying, why aren’t we using American steel? And they said, that’s a good idea. We put it in.”
He repeated the claim a day later during a tour of a Boeing Co. plant in South Carolina.
“You probably saw the Keystone pipeline I approved recently, and the Dakota,” Trump said. “And I’m getting ready to sign the bill. I said, where is the pipe made? And they told me not here. I said, that’s good -- add a little sentence that you have to buy American steel. And you know what? That’s the way it is. It’s the way it’s going to be.”
Trump told a similar story later that weekend at a Feb. 18 rally in Melbourne, Florida.
Noting that he had had moved to “begin the construction” of the Keystone and Dakota projects, Trump said that as he was about to sign the order, he asked who would be manufacturing the pipe.
“Something this audience understands very well, right?” Trump said. “Simple question. The lawyers put this very complex document in front. I said, who makes the pipe? They said, sir, it can be made anywhere. I said, not anymore. So I put a little clause on the bottom: The pipe has to be made in the United States of America if we’re going to have pipelines.”
A White House official who would only discuss the pipeline issue on the condition of anonymity said the Commerce Department was working on a plan for the president’s order requiring U.S. steel, so the administration couldn’t implement it until that effort had completed. Moreover, the official said, because the Keystone XL pipeline is currently under construction it does not count as a new, retrofitted, repaired, or expanded pipeline.
Asked about the issue, TransCanada issued a statement saying it continued “to be encouraged as our Presidential Permit application makes its way through the approval process.”
“This project will support U.S. energy security, create thousands of well-paying U.S. jobs and provide substantial economic benefits,” the company said.
Canada’s U.S. ambassador, David MacNaughton, said Friday in an interview that negotiations on Keystone’s route are going "extremely well" with federal authorities and "I don’t see any big hurdles" from the Trump administration. He called the outlook for the project "very positive."
— With assistance by Andrew Mayeda, and Josh Wingrove