The Canadian company behind the controversial Keystone XL oil pipeline called it quits on the project Wednesday, ending a decadelong standoff over the $8 billion pipeline that promised to transport 830,000 barrels of crude oil across the American plains each day. The decision to end construction on the project, which was first proposed by Alberta-based TC Energy, then known as TransCanada, is a remarkable victory for environmental activists and indigenous groups, both of whom fought hard against an additional pipeline slicing south from Alberta, Canada down through Montana, South Dakota, and into Nebraska, where it would join up with existing pipelines that would carry oil to the Gulf Coast.
TC Canada’s decision to scuttle what amounted to an extension of a pipeline system that already exists comes on the heels of President Joe Biden’s cancellation of the company’s permit to carry out construction. Nearly 300 miles of the pipeline had been built after former President Donald Trump on his first day in office reversed an Obama-era prohibition on the project. In 2018, however, a federal judge blocked further construction because the Trump administration failed to perform the environmental reviews required to receive a so-called presidential permit from the State Department for a cross-border project of that scale. The pipeline has languished since and, despite lobbying from the company to the incoming Biden administration to revive the deal, Biden revoked the permit, all but killing the pipeline.
Biden couched his Keystone decision as an environmental one as part of a broader, much needed shift away from fossil fuels to combat climate change. Biden didn’t see ponying up U.S. government support for a new pipeline as an indicator of American credibility on the issue as he tried to reassert some semblance of American leadership on the global stage. Environmentalists had targeted the pipeline construction as a procedural way to take on Big Oil and slow American oil consumption. The crude transported from the oil sands in Alberta required more processing than other forms of oil extraction, meaning it emitted more greenhouse gases in the process. Protests by indigenous groups and activists led to court challenges over use of land for the pipeline. There were also worries about that the proposed route through Nebraska cut through the Ogallala Aquifer, which provides groundwater for millions across the Plains States.
The politics of oil has changed over the last decade, as have the economics; falling oil prices have made big, pricey fossil fuel projects less attractive. The oil industry and Republicans, however, have resorted to well worn lines, criticizing Biden’s revocation of TC Energy’s permit as a jobs killer, while making vague protestations about American “energy independence.” The oil was coming from Canada, which is not a part of the U.S., so it’s not really a question of independence. TC Energy said it would cut more than 1,000 construction jobs when it suspended operations, but most of those jobs were only temporary anyway. The State Department pegged the number of full-time positions that the pipeline would bring at closer to 50.
In announcing the decision, TC Energy didn’t give much of an explanation for its decision, but the Wall Street Journal reports it did say “that going forward it would build its businesses in shipping and storing natural gas, liquid fuels and power to meet growing North American demand for cleaner fuels.” And that, while not the final destination, sounds a lot like progress.
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