What You Need to Know About Obama’s Speech in Cushing, Oklahoma
Tomorrow morning, a pipe yard in rural Oklahoma will become a platform for President Barack Obama’s domestic energy policy.
The event is part of Obama’s four-state energy tour, and the stop in Cushing — home to one of the largest crude oil storage facilities in the world — is as symbolic as it is significant.
Cushing is Important to American Energy Prices
Cushing is the self-proclaimed “Pipeline Crossroads of the World.”
Marketing hype aside, the small city provides temporary housing for one very important resident: oil.
Currently, there are more than 40 million barrels of oil there, reports The Oklahoman. And companies are building even more storage capacity in Cushing, upwards of 65 million barrels.
Futures traders can make money from stored oil, so industry analysts pay close attention to what goes on in Cushing and the price of its oil benchmark, the West Texas Intermediate.
Lately though, as KOSU reports, Cushing has been more hoarder than hub. And there are only a handful of pipelines carrying oil from Cushing to refineries in southern Texas.
Pipelines are Political
The proposed Keystone XL pipeline will pass through Cushing, bringing crude from Canada to Port Arthur on the Texas Gulf Coast.
In January, the Obama administration rejected TransCanada’s permit for the northern part of the pipeline, which was saddled with routing issues in Nebraska.
The move was praised by environmentalists and anti-pipeline activists and assailed by energy companies, and Republican presidential candidates, here in Oklahoma and around the country.
Both Newt Gingrich and Rick Santorum made primary stops in big-energy Oklahoma to champion oil and natural gas drilling and decry federal regulation, which has become a dividing line between Obama and his Republican presidential rivals, both on domestic energy independence and job creation.
But some have questioned TransCanada and its supporters’ claims that the pipeline project would create 20,000 construction and manufacturing jobs and more than 100,000 direct, indirect and induced jobs.
One study, from Cornell University, found that only 20 full-time jobs would be created by the pipeline project, and that 85-90 percent of those hired for temporary work would be non-local and hired from out of state.
But Obama has promised to expedite approval of the 500-mile OK-to-Texas segment, the construction of which is already underway at the pipe yard in Cushing, which Obama will use as a backdrop for Thursday’s speech.
Obama is Expected to ‘Fast-Track’ Pipeline Construction
TransCanada’s original Keystone KL permit required State Department approval because it crossed the international border with Canada.
And while the southern segment crosses no such boundary, the U.S. Army Corps of Engineers has to approve the OK-to-Texas segment because it passes through corps-regulated land and lakes.
Obama is expected to announce his plans to help “fast-track” this process on Thursday, an anonymous source tells CNN.
The Energy Industry is Watching
In an editorial published in Wednesday’s Oklahoman, the chiefs of four Oklahoma energy giants praised private-sector drilling and hydraulic fracturing innovation and pushed Obama to approve the entire Keystone XL pipeline, not just the southern section.
“Now — not after the election,” they write. “America’s greatest benefit will come when we can transport oil from our best energy partner, Canada, and oil-rich North Dakota and Montana.”
The CEOs also attacked Obama’s position on corporate taxes and for wanting to end $4 billion in subsidies for oil and gas companies.
“… punitive tax increases such as eliminating the business deduction of drilling costs or selectively increasing the energy industry’s corporate tax rate by abolishing deductions available to other manufacturers would give us no option but to reduce our drilling programs, resulting in fewer jobs and higher prices.”
The Public Isn’t Invited
Thursday’s Cushing speech starts about 10 a.m., but it’s closed to the public. Gov. Mary Fallin and Lt. Gov. Todd Lamb are out of the state, and Obama’s first presidential visit to Oklahoma also won’t be officially welcomed by state officials.
We’ll report what he said and provide full audio of the entire speech, but Oklahomans who want to see the president in person themselves should start looking for tickets to the Thunder vs. Clippers game in Oklahoma City, which Obama is expected to attend.