The President Donald Trump DAPL-Keystone XL actions today (Tuesday) give new life to two oil pipeline projects the Obama administration opposed.
President Trump doesn't have the power to simply approve the Dakota Access pipeline (DAPL) and the Keystone XL pipeline. But his executive actions re-open doors that President Barack Obama had closed.
Both the DAPL and the Keystone XL pipeline have become political flashpoints - which is why this is such big news.
Liberals trying to stop the pipelines see them as a front line in their fight against climate change. But conservatives want to see the projects completed, both to create jobs and as part of a strategy to make the United States energy independent.
The President Trump DAPL executive action is more likely to deliver results first. Rep. Kevin Cramer (R-ND) told The Hill that President Trump's DAPL action instructs the federal agencies responsible to expedite approval of the pipeline.
But it's all part of a long-running political game...
Why the Trump DAPL Action Is Old-Style Washington Politics
Trump's executive order today reverses the actions of the Obama administration, which halted construction on DAPL Sept. 9. Three months later the Army Corps of Engineers, the agency charged with granting approval of such projects, stopped the project dead in its tracks.
The Corps told the pipeline company, Energy Transfer Partners LP (NYSE: ETP), that it would deny ETP the final easement it needed to complete the pipeline - a section that runs under the Missouri River.
The move by the Obama administration played well with his liberal base, which has enthusiastically supported the opposition of the Standing Rock Sioux tribe to the pipeline. The tribe says DAPL threatens its water supply and desecrates sacred sites.
But ETP had obtained all the required permits. The DAPL project was more than 60% complete with $1.6 billion already spent when the Obama administration pulled the plug - a move chilling to any company considering an energy infrastructure project.
Of course, President Trump's DAPL revival is no less political. He mentioned both pipelines often in his campaign speeches. Such projects play to his themes of job creation and "America First" (energy independence).
The long struggle of the Keystone XL pipeline (it started in 2011) has been even more about politics. Both sides used "alternative facts" to score political points.
President Obama seemingly put a stake through the heart of the Keystone pipeline when he rejected it in 2015. TransCanada Corp. (NYSE: TRP), the company behind Keystone, withdrew its application. His Democratic allies cheered.
Now President Trump is seeking to satisfy his followers by bringing Keystone back from the dead.
While the political battles are real enough, there's a crucial fact that almost always gets ignored in the media coverage over these pipeline projects.
Here's what they "forget" to tell you...
The DAPL and Keystone XL Pipelines Are a Drop in the Barrel
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The key point left out of most stories on DAPL and Keystone is that the United States already has a huge, elaborate spider web of pipelines. Any given pipeline won't make that much difference, either in the fight against climate change or in making America energy independent.
As of 2015, the United States had 73,300 miles of crude oil pipelines and 62,600 miles of refined petroleum product pipelines, according to the Pipeline and Hazardous Materials Safety Administration. There's more than 300,000 miles of natural gas pipelines.
Two of those natural gas pipelines happen to pass under the Missouri River in the same location that DAPL would. That's not something you hear about, either.
In all, the United States has more than 2.5 million miles of hazardous liquid pipelines.
By comparison, the DAPL project is 1,172 miles and the Keystone XL pipeline is 1,179 miles.
But even more ridiculous is the fact that oil and natural gas pipeline projects are getting built all the time. Unless someone makes a political stink about it, though, you'll never hear about it.
Back in 2014, at the height of the Keystone XL pipeline controversy, a nearly identical pipeline was completed. Built by Enbridge Energy Partners LP (NYSE: EEP) and Enterprise Product Partners LP (NYSE: EPD), it carries crude oil from Bakken and Permian producers, as well as Canadian crude, to refineries along the Texas Gulf coast.
The Seaway pipeline opened in January 2015, with only local media covering the ceremony. It has a capacity of 850,000 barrels of crude a day - more than the Keystone XL's 830,000 capacity and much more than DAPL's 570,000.
And when no one was watching, even the Obama administration didn't mind the creation of new pipelines.
In just two years - from 2013 to 2015 - the United States added 12,000 miles of crude oil pipelines. And new pipeline projects get approved all the time.
In May 2016, the Federal Energy Regulatory Commission granted presidential permits to two natural gas pipelines in Texas, the Trans-Pecos and the Comanche Trail projects - both owned by DAPL's Energy Transfer Partners.
President Trump's move to push the DAPL and Keystone XL projects forward will get the usual breathless treatment from the media, of course. But in the big picture, neither will make that much of a difference.
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About the Author
David Zeiler, Associate Editor for Money Morning at Money Map Press, has been a journalist for more than 35 years, including 18 spent at The Baltimore Sun. He has worked as a writer, editor, and page designer at different times in his career. He's interviewed a number of well-known personalities - ranging from punk rock icon Joey Ramone to Apple Inc. co-founder Steve Wozniak.
Over the course of his journalistic career, Dave has covered many diverse subjects. Since arriving at Money Morning in 2011, he has focused primarily on technology. He's an expert on both Apple and cryptocurrencies. He started writing about Apple for The Sun in the mid-1990s, and had an Apple blog on The Sun's web site from 2007-2009. Dave's been writing about Bitcoin since 2011 - long before most people had even heard of it. He even mined it for a short time.
Dave has a BA in English and Mass Communications from Loyola University Maryland.