TransCanada Keystone to pass through Baker

President’s Keystone XL order gives hope to state’s oil industry


BAKER — Original plans called for a large portion of the Keystone XL pipeline to cross into Montana, specifically through Fallon County. Its importance is marked by the dollars and jobs it would bring to the state’s oil industry.

So it came as a major announcement last month when President Donald Trump signed an executive order to reopen the door for TransCanada’s Keystone XL pipeline project.

The Canadian oil giant followed the order by resubmitting its application for a presidential permit. Optimism ran high through the oil industry after that announcement.

Shipping costs by rail for crude oil stands between $12 and $15 per barrel. The average cost to transport crude by pipeline is about $5 per barrel. The producer is putting an extra $8 to $10 in their pockets with each barrel when using a pipeline.

“This allows them to spend more money on capital expenditures,” said a 15-year employee of the oil industry, who spoke on condition of anonymity. “Anytime producers are spending capital dollars, jobs are created.

“I feel additional jobs will be coming back because of this.”

TransCanada submitted its initial application for approval of the pipeline at the end of the last decade. The application called for it to run from Hardisty, Alberta to an existing pipeline near Steele City, Neb. The pipeline would be able to move up to 830,000 barrels of oil per day, including 100,000 barrels from the Bakken region, and provide approximately 20,000 direct jobs.

“The Keystone XL pipeline will create good-paying Montana union and tribal jobs,” said Sen. Steve Daines, R-Mont., in a release last month. “After years of talk and political nonsense, I couldn’t be more thrilled that President Trump has heeded my call to move forward construction of this project.”

If completed the Keystone XL would extend down from Canada, navigate to the southeast directly through Baker, Mont., and join the existing Keystone pipeline in Nebraska.

President Barack Obama vetoed a bill last year that would have granted approval for construction to begin on the pipeline.

Trump pledged to reverse that decision. He invited TransCanada to reapply for a presidential permit and directed relevant federal agencies to provide an expedited review of the project.

He also verbally called for the pipes used in the Keystone XL, and similar pipelines, to be made in the United States.