US President Barack Obama meets president-elect Donald Trump in the Oval Office in the White House to discuss transition plans on November 10 2016. Picture: Reuters
US President Barack Obama meets president-elect Donald Trump in the Oval Office in the White House to discuss transition plans on November 10 2016. Picture: Reuters

Donald Trump moved to reverse another of Barack Obama’s signature policies, backing two multibillion-dollar oil pipeline projects that became test cases for Washington’s commitment to addressing climate change.

The new US president said the Keystone XL and Dakota Access pipelines would help meet his campaign promise of producing new blue-collar jobs at home, insisting any portions built in the US use domestically-produced steel.

"We will build our own pipes, like we used to in the old days," Trump said in the Oval Office, as he signed executive orders to advance construction on both.

Oil pipelines have emerged as totems in a wider war between the fossil fuel industry and environmentalists. Keystone XL was the most controversial and the Obama administration delayed its verdict for four years, rejecting it ahead of 2015 climate talks in Paris.

The $8bn pipeline is designed to carry crude from oil sands in Alberta, Canada, to refineries in the US, and pitted opponents who feared greenhouse gas pollution against an energy industry that promised to create US jobs. Oil sands generate more emissions than many conventional oil and gas sources.

"We are going to renegotiate some of the terms [with Canada], and if they’d like, we’ll see if we can get that pipeline built," Trump said.

The $3.8bn Dakota Access pipeline, which is more than 92% complete, also drew months of fierce protests, including from Native Americans who feared the 1,800km pipeline would endanger their water supplies. Trump said approval for the last section would be "subject to terms and conditions, to be negotiated by us".

The decision was made a day after Trump withdrew from the Pacific trade pact that was a cornerstone of Obama’s "pivot" to Asia, and comes amid efforts to scupper his predecessor’s healthcare plan, widely seen as central to his presidential legacy.

Even after Trump’s action, Keystone XL builder TransCanada still faces a lengthy approval process before construction can begin. The Dakota Access pipeline is expected to proceed more quickly. In both cases, however, additional legal skirmishing is anticipated.

Annie Leonard, executive director of Greenpeace USA, said protesters would resume their fight against both.

The executive orders, which included new conditions on the environmentally-sensitive projects, fulfilled campaign promises while risking renewed protests and legal challenges.

Keystone XL would create 28,000 "great construction jobs", Trump said. The state department concluded in 2014 that construction would support about 42,000 jobs for a year, including 16,000 directly in construction and the supply chain.

© The Financial Times 2017

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