Trump Administration Grants Pipeline Permits Without All His Promised Conditions

  • President had said Americans should get ‘significant’ profits
  • Keystone, Dakota pipelines approved without promised changes

Trump Says Keystone XL Approval Is a 'Great Day for Jobs'

President Donald Trump vowed to win a "better deal" for Americans before approving the Keystone XL and the Dakota Access oil pipelines, promising to extract concessions and force the builders to use U.S. steel.

Now his administration has authorized both projects -- with those conditions mostly unmet. The outcomes illustrate the limits of the president’s power and poke holes in the carefully crafted image of Trump as a dealmaker so good at twisting arms that he wrote a book about his negotiating prowess.

“Donald Trump’s promises on these pipelines are like the pipelines themselves: hollow," said Senator Ed Markey, a Democrat from Massachusetts. "The only promises being kept with approval of these pipelines will be the ones made to Big Oil who want to export this dirty oil to thirsty foreign markets at the expense of our environment and our economy."

TransCanada Corp. says it has agreed to increase the amount of U.S. steel in the pipeline, after diverting some of the foreign-made stock it planned to use to other projects. And White House press secretary Sean Spicer called it "an even better deal for the American people than before he took office."

Read more: More Hurdles Ahead for Keystone XL, TransCanada Head Tells Trump

"TransCanada will finally be allowed to complete this long overdue project with efficiency and with speed," Trump said in the Oval Office on Friday. He cast the announcement as part of a "new era" of energy policy that will lower costs for families, reduce U.S. dependence on foreign oil and create thousands of jobs. 

Trump had conditioned his support for Keystone XL even before he moved in to the White House. In North Dakota last May, Trump said he would approve TransCanada’s proposed pipeline in exchange for a "better deal" that ensures U.S. taxpayers get "a significant piece of the profits."

Even as he revived consideration of Keystone XL and the Dakota Access pipelines in January, Trump said authorizations were "subject to terms and conditions to be negotiated by us."

The same day, Spicer said Trump would "make sure that he is looking or working with all parties involved" in the fight over the Dakota Access Pipeline, including tribes that were opposed to the project.

Previous story: Dakota Access OK Came as Tribe Chief Flew to Meet Trump Team

"The president has shown through his business life that he knows how to negotiate a great deal where parties come out ahead," Spicer said. "And he’s willing to sit down with all of the individuals that are involved in the Dakota pipeline to make sure that it’s a deal that benefits all of the parties of interest, or at least gets them something" that they want.

But approval for the Dakota pipeline was announced as Standing Rock Sioux Tribe chairman Dave Archambault II was on an airplane heading for Washington and what he said he believed would be negotiations. The chairman canceled his meeting with administration officials after learning of the decision.

In January, Trump signed a presidential memo compelling the Commerce Department to take up to six months to develop a plan that would force new, retrofitted and expanded U.S. pipelines to use iron, steel and other materials made in the country.  Under that document, if the pipe is made with steel or iron partially finished outside the U.S. it shouldn’t count. It has to be produced in the U.S. "from the initial melting stage through the application of coatings," Trump said in the memo.

"You want to put pipelines under our lands, you’re going to make the pipe in this country," Trump said.

Trump reiterated that vow several times, including during a Feb. 23 meeting with manufacturing CEOs at the White House. He told U.S. Steel Corp. Chief Executive Officer Mario Longhi that “the pipe is coming from the U.S.” for the two projects.

Prior story: Despite Trump Pledge, No Requirement for U.S. Steel in Keystone

But Keystone XL won’t be entirely made-in-the-U.S.A. The Commerce Department is still reviewing the feasibility of the requirements, and rulemaking to codify them could take another year or more.

"Keystone XL is going to be built with foreign steel, imperil people all along the pipeline route while feeding exports, and exacerbate our climate crisis if built," said David Turnbull, campaigns director for Oil Change International. "Trump has shown us that he doesn’t have a clue how the energy industry actually works, and he and his team are in over their heads when it comes to negotiating on behalf of the American people."

TransCanada announced Friday that it will use more U.S. steel in the project than originally planned. It previously estimated that about half of the 660,000 tons of steel used in the U.S. portion of Keystone XL would be supplied by domestic producers -- specifically a pipe mill in Little Rock, Arkansas. The remaining 50 percent would come from pipe mills in Canada, Italy and India.

200 Miles

A TransCanada spokesman said the company had "agreed to purchase 200 miles of pipe manufactured in the United States to replace pipe we deployed to other TransCanada projects."

TransCanada President Russ Girling noted that the company had already bought most of the materials for Keystone, with the majority purchased in the U.S. The rest will be made by American manufacturers "to the best of our abilities," Girling told reporters outside the White House on Friday.

That’s not good enough, said Tom Steyer, the billionaire activist who heads NextGen Climate.

"Trump promised that Keystone XL pipeline would be built with American steel or it wouldn’t be built, period. He lied," Steyer said in an emailed statement. "Once again, he is bowing to corporate polluters and Russian oligarchs in a deal that harms the safety, health and prosperity of American families."

Dakota Access, meanwhile, was already 84 percent built by the time the Army Corps of Engineers granted a necessary easement for Energy Transfer Partners LP to finish the project last month.

Jane Kleeb, president of the activist group Bold Alliance, wryly noted on a conference call that the steel for Keystone XL was purchased long ago and "is sitting in a field in North Dakota -- and has been for the past five years."

"It is, yet again, another lie that the president has said to the American people," Kleeb said.

— With assistance by Ari Natter, and Meenal Vamburkar

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