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Wednesday, April 1, 2020

Okla. AG stumps for pipeline in letter to Clinton

By Jessica M. Karmasek | Oct 3, 2011


OKLAHOMA CITY (Legal Newsline) - Oklahoma Attorney General Scott Pruitt on Friday expressed his support for the TransCanada Keystone XL Pipeline.

Pruitt, in a letter to U.S. Secretary of State Hillary Clinton, outlined the economic and national security benefits of the Keystone XL.

First and foremost, Pruitt says, the pipeline is vital to the energy security of the nation.

"The continued instability in the Middle East, particularly in Libya, and the impact such instability has on global energy markets, highlights the need to reduce America's reliance on oil supplies from that region," he wrote. "Keystone XL is a critical step in securing our nation's energy future and presents a unique opportunity to strengthen our national security."

The construction and development of the pipeline also will provide much needed economic growth in the plains states, he says.

Pruitt points to an independent study done by Waco, Texas-based financial analysis firm The Perryman Group, which says Keystone XL is expected to generate tens of billions of dollars in economic activity in those communities through which it passes.

According to the study, the pipeline will:

- Generate private sector investment of more than $20 billion in the U.S. economy;

- Create about 20,000 construction and manufacturing jobs, increasing the personal income of American workers by $6.5 billion;

- Generate more than $585 million in new taxes for states and communities along its route; and

- Pay more than $5.2 billion in property taxes during its operation.

Specific to Oklahoma, the pipeline is expected to created 14,440 person years of employment for state workers, create $25 million in local and state government revenues during construction, and create an estimated $667 million in Oklahoma property taxes during its 100-year operational life.

Pruitt says the pipeline also will help alleviate the ongoing supply glut at the state's Cushing Hub.

The hub, the attorney general explains, is the price point for West Texas Intermediate crude oil.

"The price for WTI is used to set equivalent prices for crude oil produced in Oklahoma and nearby states and has historically been considered the global benchmark for crude oil," he wrote.

"In recent years however, there has been a growing oversupply of crude oil held in storage around the Cushing Hub. This oversupply is one of the reasons the price for WTI has been suppressed in comparison to other global benchmarks such as Brent."

Pruitt says his office is looking into the causes of the oversupply, but believes it partially stems from insufficient outgoing pipeline capacity to transport crude from Cushing to the refineries on the Gulf Coast.

"The Keystone XL offers the most efficient starting point in what will likely be an ongoing effort to solve the outgoing pipeline capacity issues plaguing the Cushing Hub," the attorney general wrote.

The U.S. State Department held a public hearing Friday on the proposed pipeline. Pruitt did not appear in person, but provided a written statement and the letter to Clinton.

From Legal Newsline: Reach Jessica Karmasek by email at

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