Would Obama consider Republican Keystone bill? ‘I’ll see what they do,’ he says

Keystone 30-inch pipeline (phase 1) near Swanton, Nebraska in 2009. shannonpatrick17 / Flickr.

WASHINGTON—U.S. President Barack Obama spent five minutes disparaging the potential benefits of the Keystone XL pipeline Friday.

He then kept it alive with five words.

At a wide-ranging year-end news conference Friday, Obama maintained his recent pattern of expressed skepticism about the project: He played down its job potential, said it wouldn’t lower gas prices for Americans and, employing the language of pipeline opponents, said it would merely help Canadian “tar sands” companies export their product overseas.

When given the chance to twist in the knife, however, the president relented.

He was asked whether he’d veto the Keystone XL bill that will likely be sent to his desk by the new Republican Congress, perhaps early in the new year, and he replied: “I’ll see what they do.”

The Republicans have said a Keystone bill will be their No. 1 priority in January, and also said they’ll allow amendments to the bill—which could turn it into a vehicle for legislative deal-making. A pro-pipeline Democrat has urged fellow lawmakers to pack the bill with a few of the president’s priorities to get him to sign it.

Obama made clear Friday what some of his legislative priorities are.

One is reform of the convoluted, three-decade-old U.S. tax code. And he specifically mentioned another when asked about Keystone XL.

What would really create jobs, Obama said, far more than the few thousand associated with the pipeline, would be if Congress funded the refurbishment of national infrastructure.

“When you consider what we could be doing if we were rebuilding our roads and bridges around the country, something that Congress could authorize, we could probably create hundreds of thousands of jobs or a million jobs,” he said.

“So, if that’s the argument, there are a lot of more direct ways to create well-paying American construction jobs.”

Obama remains the key player in the pipeline debate, which has raged in the U.S. for years and foreshadowed newer disputes now plaguing the Canadian oil industry.

Obama can not only decide whether to sign or veto a bill; he can also choose whether to approve the project through the normal, non-legislative regulatory process.

His administration says it can’t complete that regular process while the route through Nebraska remains in dispute. The state supreme court there could rule any week, in a case involving the constitutionality of the process used to sign off on the route.

Obama’s comments have frustrated pipeline proponents—who say they’re so wrong even his own State Department contradicts them.

A State Department review has concluded that Keystone wouldn’t be used to export crude oil overseas. As for refined petroleum, much of it would belong to American companies that own oilsands properties and also the U.S. Gulf Coast refineries. In addition, the pipeline would pick up oil in the U.S. Midwest.

Canada’s ambassador to the U.S. emphasized some of those points in response to Obama.

“I did not know Canada just gained North Dakota and Montana,” Gary Doer said Friday, referring to the non-Canadian oil that would enter the pipeline.

“The pipeline includes (U.S.) Bakken oil.”

The Keystone comments came during a wide-ranging press conference where Obama also:

• Criticized Sony Pictures for bowing to threats and pulling the movie, “The Interview,” which angered the North Korean government. Obama said that sets a terrible precedent.

“We cannot have a society in which some dictator someplace can start imposing censorship here in the United States,” he said. “Because if somebody is able to intimidate folks out of releasing a satirical movie, imagine what they start doing when they see a documentary that they don’t like or news reports that they don’t like… That’s not what America is about.”

• Defended his deal to reopen diplomatic relations with Cuba, after 53 years. He addressed criticism that he helped sustain the Castro regime, by making a deal without any concessions on democratic rights.

Obama said the old approach hasn’t made Cuba more democratic, but perhaps more international contact will.

• Appeared to revel in some recent political wins. After a year of geopolitical crises and a crushing midterm election, Obama completed 2014 with a historic, if controversial, announcement affecting nearly 5 million illegal immigrants; a deal to restore relations with Cuba after 53 years; and a funding bill that eliminates the risk of a government shutdown for a year.

With files from Dean Bennett in Calgary