Briefing on the Keystone XL Pipeline

Special Briefing
Kerri-Ann Jones
Assistant Secretary, Bureau of Oceans and International Environmental and Scientific Affairs
Via Teleconference
Washington, DC

January 18, 2012

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MODERATOR: Good afternoon. We’re pleased today to have Assistant Secretary Dr. Kerri-Ann Jones in the Bureau of Oceans and International Environmental and Scientific Affairs, who will discuss the Keystone XL Pipeline project. A reminder that today’s call is on-the-record. Dr. Jones will have some brief opening remarks, followed by any questions that you might have. Without further ado, I’ll turn it over to Dr. Jones for her opening remarks

ASSISTANT SECRETARY JONES: Good afternoon, everyone. Thank you for being on the call. We wanted to talk today about the announcement that we have made. As you know, today the Department of State recommended to President Obama that the presidential permit for the proposed Keystone XL pipeline be denied and that at this time the TransCanada Keystone XL pipeline be determined to not serve the national interest. The President agreed with the Department’s recommendation. This recommendation was predicated on the fact that the Temporary Payroll Tax Cut Continuation Act that was passed in December does not provide sufficient time to obtain the information that we think is necessary to assess whether the project, in its current state, is in the national interest.

As you – many of you know, we made a decision on November 10th that we needed additional information regarding this project, specifically about alternative routes through Nebraska. And we base this decision now on the fact that we don’t have time to get that information, information we think is essential for making a well-informed decision. So I think I’ll stop there and open it up for questions.

MODERATOR: Okay, Melissa. We’re ready for questions.

OPERATOR: Yes, sir. Thank you. As a reminder, to ask a question, please press *1 at this time. The first question we have comes from Josh Rogin, Foreign Policy. Your line’s open.

QUESTION: Yes, thank you very much for taking the time to do the call. I’m wondering, since you’re saying that, the – there wasn’t enough time to properly evaluate the proposal, was that evaluation made when the law was passed, or was – what have you been doing for the last – since the law was passed? Have you been working on this? Do you anticipate evaluating a new proposal? And could you also please characterize the level of White House involvement in the State Department’s process during this period? Thank you.

ASSISTANT SECRETARY JONES: Okay, that’s a lot of questions.

QUESTION: Yes, it is.

ASSISTANT SECRETARY JONES: Let me start with the first one: What have we been doing since this Act was passed? I think you have been following our press announcements and our different comments. We have been analyzing the legislation. But when it was first proposed, we did mention and we did sort of confirm that we felt that any sort of imposition of a deadline would compromise the process. Our decision that we needed the extra information that we identified on November 10th wasn’t changed by the legislation. And the legislation provided 60 days to really get all that information and do the analysis, and we just didn’t think that was adequate and we couldn’t really make a decision. And therefore, the pipeline would not – as it is currently presented, could not be deemed in the national interest. So that’s number one.

I think the second one was more about the White House involvement, and there’s sort of two phases here. The first phase, certainly the White House was not involved. November 10th we made this decision that we needed additional information and we informed the White House of that, and I think we talked about that in one of my previous press calls. Since the legislation was passed, we have consulted with the White House as it really talks about what the President needs to do, and we have been consulting with the White House because of the new legislation.

QUESTION: So the point is that the charge against the State Department is that this was a White House-driven political decision. And so what I’m trying to get at here is, did this decision come from the White House or was this decision actually made inside the State Department?

ASSISTANT SECRETARY JONES: This is a process decision that we made based on the decision that we made on November 10th and the information that we felt we needed to really inform our decision to make sure we had everything we needed to do the best, in terms of looking at this pipeline and determining whether or not it was in the national interest. So the White House made that decision. We, today, recommended to the President that the permit be denied, and also that he determine that it was not in the national interest. The legislation did not give us enough time to really do responsible evaluation of the factors. And so we continue to believe that this has to be done the right way. So from my perspective, this has not been – this decision is based on what we did November 10th, and then the legislation has not given us adequate time to carry that out.

QUESTION: And my other question was: Do you anticipate another proposal?

ASSISTANT SECRETARY JONES: Well, the decision that we made – that the President made today accepting our recommendation does – is not made – is based on the fact that we have insufficient information, so it does not preclude other permits of this type that would come in.

QUESTION: All right. Thank you.

OPERATOR: Thank you. The next question we have comes – Neela Banerjee from Los Angeles Times.

QUESTION: Hi. Thank you for holding this call. TransCanada, in its statement today, said that they expect to – that they plan to reapply. And one of the things that they said is that they “expect a new application” – I’m reading from their press statement – “would be processed in an expedited manner to allow for an in-service date of late 2014. TransCanada expects that consideration of a renewed application will make use of the exhaustive record compiled over the past three-plus years.”

So I wanted to ask you about that. Do you – I mean, if TransCanada reapplies, as it says it will, what use will the previous assessments – what role will they play in any kind of new EIS? And how realistic is this late 2014 date? Will you have this expedited process as they’re – as they say that you will?

ASSISTANT SECRETARY JONES: Thank you for that question. If the – if TransCanada comes in with a new application, it will trigger a new review process, a completely new review process. We cannot state that anything would be expedited or – at this time. It would just have to go through all of the requirements that are needed for this kind of application review. So I couldn’t really speak to when such a review could be finished.

However, I could mention that we do have guidelines that would allow us to use information that’s out there. So there is information out there from the process we’ve been through, but we would also have to look at this as a completely new application, and that’s how it would be treated.

QUESTION: Thank you.

OPERATOR: The next question we have comes from Arshad Mohammed from Reuters.

QUESTION: Yeah. It’s Arshad Mohammed from Reuters. I just wanted to go back to the last question. If I understood correctly, you said that any application would have to be treated as a new application, so you can’t speculate on how long it might take to evaluate. But is it not the case that, both under NEPA and under agency regulations, it is possible for you to take into account the past environmental analyses that have been done? If a new application were to closely track the previous application, then it seems to me that it’s only fair to give the company and the broader public some understanding of whether it’s going to be soup to nuts, you start everything all over again, or whether it’s conceivable that you could save some time if it – if a new proposal didn’t differ that much, that you wouldn’t have to go over everything that you went over the first time around.

ASSISTANT SECRETARY JONES: Right. I think – first of all, it’s a little bit hard to comment on a permit application that hasn’t been submitted yet, and so we haven’t seen it. But your point is that we do – and there are regulations under NEPA, and the Department also has internal procedures that outline how to make use of existing NEPA documents, such as the FEIS that we completed in August, when reviewing a new application. So you are correct. The body of information that was out there would inform a new application, but there are certain specific guidelines that have to be used. And beyond that, I can’t comment, because it would be a completely new application and a new review process.

QUESTION: So – and when you say it would not be expedited, I guess what you’re suggesting is it’s not like there would be any fast-track process. But it’s – I mean, is it really conceivable that you’d have to go over every single thing anew if it were similar to the existing proposal?

ASSISTANT SECRETARY JONES: Well, I really – I can’t really speculate on that level of detail. I mean, we would treat any future application fairly and in light of all of the information that was brought in with that application, and then we would look at existing information that we have, based on how we’re allowed to use that under NEPA procedures and Department guidelines. But that’s what we would do. I can’t really speak to exactly the steps that you’re delineating, because I can’t really know exactly what application would be like, and we would have to wait to see what the new application was.

OPERATOR: Thank you. The next question we have comes from Juliet Eilperin, Washington Post.

QUESTION: I may still take – thanks for doing this. I might take one more crack at this to just say that while obviously – could you, first of all, either talk about what you think would have to be updated as part of looking at this application? And again, while you obviously (inaudible) new application, is there anything you can give about how shortened a timeline you could have if you have already factored in the environmental review that obviously has taken several years? I mean, given – if it’s a fairly similar route, is there anything you could say about what time process would be involved or, again, things that you could say right now that you feel like, even if they’d been done, the report – the Department would have to look at afresh?

ASSISTANT SECRETARY JONES: I really can’t comment on it, because it is much too speculative. Today, what we’re talking about is our recommendations and the decision – the President’s decision to accept our recommendation and where we are at this point. I mean, going into the future, I think what I have explained in terms of it being a new process, we would have to follow all of the regulations and guidelines, but we would be able to draw on the information that’s out there to the extent it’s allowable under the procedures I’ve already mentioned. But beyond that, I can’t really speak to a defined timeline or anything else, because there’s no application, and it really is much too speculative.

QUESTION: And then just one quick thing: When – in the statement that the President gave, when he refers to, for example, looking at oil shipments and capacity between Cushing and Gulf Coast refineries, does – would State play any role at all in the decision making on that, or would you be completely removed because it’s – again, it’s not cross-border and therefore would have actually no intersection with State Department authorities?

ASSISTANT SECRETARY JONES: Well, an oil pipeline from Cushing, Oklahoma to the Gulf of Mexico would be purely a domestic pipeline, and it wouldn’t be crossing any international border, so it wouldn’t require a presidential permit, which is the role that the State Department is involved in. So we would not be involved.

OPERATOR: Thank you. The next question we have comes from Mike Holmes, Omaha World Herald.

QUESTION: Dr. Jones, I’m still a little puzzled here. If TransCanada comes back to you with the same route except modifying it to meet its agreement with the state of Nebraska to go around the Ogallala Aquifer, why would you have to review the entire route rather than just the change?

ASSISTANT SECRETARY JONES: Because it would be – it would be a new application for a permit. And as I’ve said, we are – what’s happening today is the permit that is currently pending is being denied, and so a new permit application would trigger a new process. We would certainly, as I stated, look to the information that’s out there to the extent we can, but I – it’s a new permit application so the process has to be started over again.

OPERATOR: Thank you. The next question we have comes from Deborah Yedlin, Calgary Herald.

QUESTION: Thanks for taking my call – my question. I’m puzzled as well. I know that the U.S. has made a very big platform of ensuring its energy security. It strikes me that the TransCanada XL pipeline, the Keystone pipeline, would achieve that. So how can you be opining that this is not in the national interest when it goes against this notion of national – of securing your energy future?

ASSISTANT SECRETARY JONES: The determination that’s being made today is based on the fact that we have insufficient information at this point. It goes back to the decision that we made on November 10th when we stated that we needed additional information to really – to really determine if this could be in the national interest. And that is why we cannot at this point go forward, because we don’t have that information. It’s impossible to get that in the 60-day timeframe that has been spelled out in the act, and so that has led to our actions today.

So the broader issues that you mentioned – certainly energy security, environment, all of those issues – are parts of the national interest, but our decision today is because we have a lack of time to get the information that we think we need.

QUESTION: Thank you.

OPERATOR: The next question we have is Elizabeth Shogren, NPR.

QUESTION: My question follows on that one, which is what is your assessment of the costs that this decision has for energy security?

ASSISTANT SECRETARY JONES: I really can’t speak to that question at this point. I’m sorry, there’s some static on the line. I really can’t speak to that question at this point. Energy security is one of the considerations in this very complex proposal and in our review process. Today’s decision is based on the fact that we do not have adequate information to go forward. And as you know, one of the things required in the act is that there will be a report to Congress, and we will – we think we will need to address some of those issues in that later on today.

OPERATOR: Thank you. The next question we have is from Mike Melia, PBS NewsHour.

QUESTION: Hi there. Thank you for taking the calls. Can you get a little more specific about what were the key points that you felt would not be able to be answered by February 21st? I know you’ve just said – taking us back a bit to November. But looking at that 60-day timeline, what were the key elements you felt you couldn’t do? And we know the President spoke to Prime Minister Harper today. Have you all been in contact with your Canadian counterparts, and what were their reactions?

ASSISTANT SECRETARY JONES: Okay. In terms of our decision on November 10th, we pointed out that based on the public comments that we had received, we really needed to do in-depth analysis of alternative routes that would avoid the Sandhill area in Nebraska. And there are many dimensions to that analysis and it takes a while to get a lot of that information, and it is something that we just were not able to get that information in terms of how to look at the different perspectives.

For instance, it’s my understanding that the applicant has just recently begun to suggest some corridors where alternate routes may be possible, but there has not been much detail work done, which would require a lot of analysis based on the topography and the endangered species and the relative water issues. So much of that information would take quite a while to get. It would take beyond the 60-day timeline.

QUESTION: And a response – have you been in touch with your Canadian counterparts in addition to the President’s call?

ASSISTANT SECRETARY JONES: Today I have not been. I did speak to some – I did reach out to some of my interagency colleagues but not to any of my Canadian colleagues today.

MODERATOR: All right, Operator, we have time for about two more questions, please.

OPERATOR: Yes, sir. Thank you. The next question is from Andrea Mitchell, NBC News.

QUESTION: Hi, thanks for taking the question. Do you have specific estimates of how much oil you’re foregoing? And when you talk about the national interest, what do you say to those who say that energy independence and our reliance on Iran and other unreliable sources in the global market is a much larger threat than this pipeline would be?

ASSISTANT SECRETARY JONES: Well, I think I would refer you to some of the work that was done in the analysis of the – in the SEIS, where there was analysis in terms of the impact of this pipeline being built or not being built in terms of crude oil coming into the country. And also I think this decision today doesn’t make our commitment to energy independence and energy security any less of a priority. It’s a major priority for our country. We’re making this decision because of the process; we did not have the information we need to make the decision that we thought would be well-informed.

QUESTION: It’s still – I guess a lot of us are confused as to how that information could not have been achieved in the weeks that you’ve had. You were aware of the Nebraska problem for quite some time.

ASSISTANT SECRETARY JONES: Well, it was on November 10th that we made the decision that we needed the additional information, and since then we have been engaged with discussions with the applicant and with the state of Nebraska. At the end of November, I – or towards the end of November, I believe, the state of Nebraska did pass some legislation regarding rerouting, and we have been working on this. But it is a very – it is a complex issue. Looking for alternative routes and identifying them requires a level of specificity and detail that you have to get into to really be able to analyze them, to compare them. And so it is difficult to get the kind of information that we believe is needed to make a very well-informed decision for the country about this, and we didn’t – we knew we could not get that done in the 60-day timeline.

OPERATOR: Thank you. The next question we have is Luiza Savage, MacLeans.

QUESTION: Yes, hello. Thank you for this call. Can you respond to the governor of Nebraska, who had suggested that the State Department issue a conditional permit and allow the state of Nebraska to do its own environmental review of just that alternative route which he said could have been done in the next six to nine months?

ASSISTANT SECRETARY JONES: Well, it’s the responsibility of the State Department to grant this permit which really looks at the crossing of the international boundary, but it looks at the entire pipeline and I think we feel that it would be – it’s important for us to look at the whole pipeline and not to really move forward on such a major infrastructure project that will be a part of the country and the landscape for many years in pieces like that. And so I hadn’t heard about the governor really proposing this, but we don’t really think that’s an approach that really deals with the national interest question in an appropriate way.

QUESTION: But this whole Nebraska Sandhills issue, I mean, it was – it’s been an issue the whole – for the whole few years of this review, not just since November 10th. It’s a little confusing about why it only became an issue for the State Department on November 10th, as you keep pointing out. Why weren’t these alternative routes being looked at much earlier in the process so that you would have that information now?

ASSISTANT SECRETARY JONES: The issue of the pipeline route through the Sandhills and the related aquifers has always been a major concern. It was called out in the SEIS. It led to many discussions. We did look at alternative routes in the SEIS, but they were outside of Nebraska. What we had not done was look at an alternative route that was inside the state of Nebraska.

And in the course of having really extensive public meetings and listening to the citizens of Nebraska and also listening to people across the country, this was a major concern, and we felt that it was important to look at alternative routes within the state of Nebraska that avoided the Sandhills that are really quite a unique terrain. So it’s not that this was come to all of a sudden; this has always been something that was of concern. It was addressed in the SEIS. And then during the public meeting session, we received a tremendous amount of comment on this, and it was clear that the importance of the Sandhills was very central to that part of the country.

MODERATOR: Okay. So I’d like to thank Dr. Jones for taking the time to answer the questions today, and for all of you for participating. Operator, this concludes the call.

ENDS

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