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In this Dec. 3, 2012, file photo, crews work on construction of the TransCanada Keystone XL Pipeline near County Road 363 and County Road 357, east of Winona, Texas. Credit: Associated Press In this Dec. 3, 2012, file photo, crews work on construction of the TransCanada Keystone XL Pipeline near County Road 363 and County Road 357, east of Winona, Texas. Credit: Associated Press

In this Dec. 3, 2012, file photo, crews work on construction of the TransCanada Keystone XL Pipeline near County Road 363 and County Road 357, east of Winona, Texas. Credit: Associated Press

Steve Contorno
By Steve Contorno June 26, 2014

John Boehner says Keystone XL pipeline would create 100,000 jobs

President Barack Obama often emphasizes an all-of-the-above approach to U.S. energy production that includes a mix of natural resources and new, greener technologies.

But House Speaker John Boehner says it's Republicans, not the Democratic administration, that are truly committed to achieving America’s energy independence through a diverse portfolio.

In an op-ed for USA Today, Boehner said that Obama’s new carbon restrictions will hurt existing coal plants, while Democrats are standing in the way of House efforts to ease rules on excavating and exporting American natural gas. The White House is also blocking the Keystone XL pipeline, which Republicans — and some Democrats — continue to support.

"The nearly six-year delay in approving Keystone is costing Americans more than 100,000 jobs and nearly a million barrels of oil a day," Boehner wrote. The House has passed a bill that would fast-track the pipeline.

We’ve taken a number of looks at claims about the economic impact of the 1,179-mile Keystone XL pipeline, a project that would connect diluted oil sands from Western Canada to Nebraska and then Gulf Coast refineries.

But Boehner’s estimate of 100,000 jobs was so far above anything we’ve checked in the past, we wondered if new information had surfaced.

We asked Boehner’s office for supporting evidence. They pointed us to the website of an August 2011 press release from TransCanada Corporation, the company jockeying to build the Keystone XL pipeline.

The release says "independent studies" estimate that the pipeline will create 20,000 direct jobs — 13,000 construction and 7,000 manufacturing — and "an additional 118,000 total spin-off jobs."

We talked to TransCanada. At the time, they were referring to a study by the Perryman Group, a financial analysis firm they hired. But TransCanada spokesman Davis Sheremata told PolitiFact that the study is "no longer relevant." Why?

"In this case, the referenced report dealt with Keystone XL as it was proposed in 2008," Sheremata said. "The project has changed considerably since then, including substantial route changes and a new presidential permit application."

The Perryman Group analysis has been removed from TransCanada’s website and links to the study don’t work.

There were other important caveats with the Perryman study even before it was discarded by TransCanada. Most notably, the 13,000 construction jobs the pipeline would supposedly create were calculated per person, per year. That means that if the job lasted two years, 6,500 people would be employed each year.

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A study by Cornell University Global Labor Institute into the Keystone pipeline also said that the Perryman Group report is "flawed" because it "wrongly includes over $1 billion in spending and over 10,000 person-years of employment for a section of the Keystone project in Kansas and Oklahoma that is not part of Keystone XL and has already been built."

So Boehner was citing a 2011 study that was criticized and has since been scrubbed from the website of the people who commissioned it.

But are there other credible estimates?

The study most often cited is the analysis from the State Department, which is in charge of reviewing the Keystone XL pipeline for the administration. It found that the pipeline itself would directly create 3,900 construction jobs — 1,950 if the project took two years.

In all, about 42,100 jobs would be created over the course of the project. This includes jobs created directly by the pipeline (like the construction work), indirectly (like jobs created as a result of goods and services purchased by construction crews) and induced (jobs created by workers spending their wages in the economy).

When we asked TransCanada for a more recent study into the job creation potential of the Keystone pipeline, the company quoted figures from the State Department study.

As we’ve noted in the past, though, most of these jobs are not permanent, as is often the case with construction projects. The State Department found the pipeline would create 35 permanent jobs and 15 temporary jobs once it went into operation.

Finally, the Cornell study estimated the project would create about 2,500-4,500 construction jobs, and includes a total economic impact of about 33,000 to 44,000 jobs likely spread across multiple years. Meaning, it’s possible that 11,000 to 14,600 are employed each year if the project takes three years.

We told Boehner’s office that TransCanada was no longer promoting the Perryman Group study. They then directed us to a 2011 study by the Canadian Energy Research Institute, a group that includes energy company executives, as well as government and academic representation, on its board of directors. The institute found that employment would go up in the United States by 80,000 jobs to a peak of 179,000 jobs.

But those projections were over a 30-year period, and it includes jobs created by existing Canadian energy projects.

Our ruling

Boehner said Obama’s "delay in approving Keystone is costing Americans more than 100,000 jobs." He was citing a study that experts said was "flawed" and the company in charge of the project, TransCanada, said was "no longer relevant." The State Department estimated a much lower amount, and TransCanada cited that study to PolitiFact.

We rate Boehner’s statement False.

Our Sources

USA Today, "Boehner: House Republicans for responsible energy," June 25, 2014

Email interview with Michael Steel, spokesman for Rep. John Boehner, June 25, 2014

Email interview with TransCanada Corporation spokesman Davis Sheremata, June 25, 2014

TransCanada Corporation, "Final Environmental Impact Statement Re-Affirms Limited Environmental Impact from Keystone XL Pipeline," Aug. 26, 2011

TransCanada Corporation, "TransCanada Releases Detailed Keystone XL Job Creation Data," January 10, 2012

TransCanada Corporation, "Keystone XL to Create Over 6,700 Person Years of Employment in Kansas," Sept. 26, 2011

PunditFact, "CNN's Van Jones says Keystone pipeline only creates 35 permanent jobs," Feb. 10, 2014

PolitiFact, "Obama says Keystone XL would mean "maybe 2,000 jobs," July 31, 2013

PolitiFact Georgia, "Isakson: Keystone pipeline to employ 20,000," April 11, 2012

Cornell University, "Pipe Dreams: Jobs Gained, Jobs Lost by the ConstruCtion of Keystone XL," January 2012

United States Department of State Bureau of Oceans and International Environmental and Scientific Affairs, Final Supplemental Environmental Impact Statement for the Keystone XL Project: Executive Summary, January 2014

Canadian Energy Research Institute, Economic Impacts of Staged Development of Oil Sands Projects in Alberta (2010-2035), June 2011

Washington Post, "Keystone Pipeline debate heats up," Nov. 5, 2011

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John Boehner says Keystone XL pipeline would create 100,000 jobs

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