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STATEMENT

of the

Honorable Patrick Murphy, Ranking Member

Committee on Small Business Subcommittee on Agricutlure, Energy, and Trade of the House 

Hearing On Keystone XL Pipeline and Its Effect on Small Business Job Creation

May 16, 2013

Thank you Mr. Chairman.  Good morning everyone, and thank you for being here today to discuss this important topic.  We have a broad range of organizations represented here today, and I look forward to hearing from all of you.

The 875 mile Keystone pipeline project, which has the potential to transport 830,000 barrels of oil from Canada to refineries in the U.S., could have substantial impacts on small businesses, job creation, and the cost of fuel in both the short and long term.  It also is important to address the environmental issues that surround the project proposal.  This pipeline project has been a controversial issue that has generated a great deal of discussion and research, and we have a unique opportunity today to clear up misconceptions about the benefits and costs of this large project. 

In terms of the new jobs the Keystone expansion may create, estimates vary widely.  In TransCanada’s submission to the State Department, it projects that the pipeline would create more than 40,000 jobs.  On the other hand, research done by Cornell University shows that the project would create between 2,500 and 4,650 temporary construction jobs, partially because a large portion of the primary material input – steel pipe – probably would not be produced in the United States. 

For small businesses, the indirect economic effects are key.  As workers deploy to communities along the pipeline’s path, significant opportunity may be created for local small business growth.  In addition, small firms involved in the manufacture of pipeline components stand to benefit should this initiative receive regulatory approval.  Taken together, this project represents real benefits for small businesses.

While Keystone’s potential boost to jobs and local businesses has been at the center of the discussion, energy prices are another critical factor.  Tapping into new sources of oil from Canada seems to carry the promise of lowering gas prices.  However, the reality is that energy markets are global and the amount of additional oil the Keystone expansion would bring into the U.S. is relatively small in comparison to the global marketplace.  Understanding whether the pipeline will have a meaningful impact on prices is a critical component of this discussion.

Finally, such a large fossil fuel development project must include a discussion on its potential impacts on the climate and understanding whether this project would increase or decrease carbon emissions is important.  I am particularly interested in the witnesses’ perspective on this matter.

Keystone XL has the potential to bring both jobs and larger energy supplies to the U.S., but Congress must explore all of these fundamental facets of the problem before making a decision on whether to allow the project to move forward.  With that in mind, I want to thank all of the witnesses for traveling here today and Chairman Tipton for holding this hearing.

I yield back. 

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