Contractors Highlight Importance of Keystone XL To U.S. Job Creation

March 2012, Vol. 239 No. 3

A number of U.S. firms have joined TransCanada Corp. in stating how they will create thousands of American jobs building the Keystone XL pipeline, the largest privately financed infrastructure project now on the books. The companies sought to reinforce the fact that construction of the privately financed $7 billion oil pipeline means work for their employees during a period when the American economy needs jobs – 20,000 jobs in construction and manufacturing.

TransCanada is in the process of revising its original permit application which would re-route the pipeline away from certain aquifers in Nebraska. The hot-button issue has become the leading topic in this year’s presidential election with Republicans pressing the Obama administration on a final decision before Nov. 6, and the administration seeking to delay that until 2013. There is also speculation that TransCanada may decide to shorten the proposed route to eliminate the border crossing so that the project would not require a special permit from the State Department. Congressional Republicans are also behind a move that would give the Federal Energy Regulatory Commission the final say on Keystone.

MPS Constructors, LLC (a joint venture formed by three of the largest pipeline builders in the U.S. including Michels Corp., Price-Gregory International and Sheehan Pipe Line Construction Co.), Michels Corp. (under a separate contract) and Sunland Construction Inc. (also under a separate contract) represent the American contractors who have been awarded pipeline construction work in the U.S. Together, on average,
they employ close to 17,000 workers across North America.

L.A. (Buster) Gray, project director of MPS said: “Pipeline construction work utilizes a large number of highly skilled workers which in turn requires high-paying jobs. A project of the magnitude of Keystone XL can generate the annual income for a worker and his family. This pipeline project would bring badly needed jobs to our industry and the region.”

“We had a discussion with TransCanada to determine the number of workers it would take to construct Keystone XL. As a group of companies that has been building large-scale infrastructure projects for years, we fully support the figure of 13,000 workers who would be needed to build this pipeline,” Gray said.

Patrick D. Michels, president of Michels Corp., commented: “Knowing how significant the Keystone XL pipeline is to U.S. national security, energy independence, economic growth and job creation, we are very eager to get started with construction. There is no question that the permitting delays have impacted our ability to purchase supplies from U.S. companies and hire U.S. workers who need jobs. Getting the permitting go-ahead will trigger the spending and hiring that will hopefully provide a spark to jumpstart the economy.”

Robert A. Riess, Sr., president and CEO of Sheehan Pipe Line Construction
Co., added: “This project is vital to our company and the pipeline construction industry as a whole. We will put more than 1,500 skilled American workers to work on our portion alone. The presence of construction spreads in the communities along the Keystone XL route will result in the creation of numerous local jobs that will not exist without the construction of the pipeline.

“The presence of the pipeline construction workers in these communities will also stimulate local small businesses. Finally, the jobs created by the operation of the pipeline and in the refineries on the Gulf Coast will continue long after the construction phase of the project is complete. This project is critical to the future success of our economy and country,” Riess said.

Mike Langston, president of Price Gregory International, said: “Clearly, this project is a win-win for all those involved. The communities where this pipeline infrastructure will be built will realize both short-term and long-term benefits. Short term, our company will be procuring a broad range of goods and services from service providers in the communities where the line will be built. We will also be involved in community affairs, always willing to lend a helping hand where needed.

“Most importantly, there would be several thousand highly paid workers to
build it, bringing badly needed jobs to the region. This critical pipeline infrastructure makes our country stronger by securing a source of crude oil from a friendly, neighboring country,” Langston said.

Craig V. Meier, president of Sunland Construction, Inc., noted: “We strongly support this project for three important reasons: it offers significant economic benefits, strengthens energy security and will protect the environment while safely delivering energy Americans need.

“This project will positively affect our employees and subcontractors, and just as important, the local economies along the route of the pipeline. Not only will our company be spending money with various rental/service businesses, our employees will be spending time and money at local grocers, restaurants, hotels, trailer parks, convenience stores, banks and other local businesses,” Meier said.

TransCanada released details of the exact numbers of workers needed during construction. This data is based on the company’s 60 years of experience building pipelines. MPS, through its member companies Michels, Price Gregory and Sheehan, along with Sunland, assisted TransCanada in developing the data that represents a typical workforce needed for a pipeline project of this size.

Keystone XL has the capacity to deliver 830,000 barrels of oil per day to U.S. refineries in Cushing and the U.S. Gulf Coast; 250,000 barrels of capacity has been made available for the delivery of U.S. domestic oil from the Williston Basin in Montana and North Dakota and oil from Cushing. Long-term, binding contracts for thousands of barrels per day from the Williston Basin and Cushing have already been signed.

In a related development, the Laborers’ International Union of North America (LIUNA) announced Jan. 30 that it has left the BlueGreen Alliance in response to what it described as “job-killing” attacks on the Keystone XL pipeline by some of the alliance’s labor and environmentalist members.

Citing AFL-CIO President Richard Trumka’s recent statement that a divide existed in the labor movement over the project, LIUNA General President Terry O’Sullivan said: “That is an understatement. That divide is as deep and wide as the Grand Canyon. We’re repulsed by some of our supposed brothers and sisters lining up with job killers like the Sierra Club and the National Resources Defense Council to destroy the lives of working men and women.”

O’Sullivan added that he sees Keystone as just the beginning of what will likely be a protracted struggle over major projects to build and strengthen America’s energy infrastructure.

“We believe in protecting the planet, but we must also care about the people on it,” he said, noting that members of some of the union groups in opposition had no jobs to gain or lose on the project. Though opponents have declared their real issue is with oil sands development, O’Sullivan said that work will continue whether the pipeline is built.

Meanwhile, he said that construction workers are struggling with 16% unemployment with 1.3 million being jobless.

“The Keystone XL was not just a pipeline to them; it was a lifeline.”

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