Obama will decide on Keystone pipeline before he leaves office

4 Nov 2015 | Author: | No comments yet »

Keystone pipeline: TransCanada denies politics prompted call for delay.

White House officials said Tuesday the president intends to decide the fate of the Keystone XL pipeline during his tenure, rather than suspend the federal review process at the request of the project’s sponsor.

Speaking to reporters, White House press secretary Josh Earnest said President Obama “would like to have this determination be completed before he leaves office” and was not inclined to extend the seven-year review process even longer just because one section of the route is still awaiting approval in Nebraska. The head of the Canadian company behind the proposed pipeline denied Tuesday that political motivation drove its decision to ask the US government to delay consideration of the project.

On Monday TransCanada, which is seeking a cross-border permit for an 1,179-mile pipeline between Hardisty, Alberta and Steele City, Neb., that would ship roughly 830,000 barrels a day of heavy crude oil destined for U.S. The department didn’t offer an estimate of when it would respond to TransCanada, and Trudeau said she didn’t know whether the department would have to consult other U.S. government agencies. Gulf Coast refineries, asked the State Department to suspend its review until the Nebraska Public Service Commission approved a revised route through the state. The request comes as many anticipate Barack Obama will reject the project, which has been a flashpoint in the debate over climate change and source of friction between the US and Canada. Hillary Rodham Clinton, the frontrunner for the 2016 Democratic presidential nomination, opposes the pipeline but the Republican candidates support it.

Several other administration policies are likely to have a greater impact on global greenhouse gas emissions, including the Environmental Protection Agency’s rule to limit carbon emissions from new power plants and its first-ever carbon limits on cars and light trucks, and experts have debated to what extent Alberta’s oil might be shipped out by rail if the pipeline’s northern route falters. The request was seen by some analysts as an attempt to circumvent a possible rejection of the pipeline project by President Barack Obama by delaying a final decision until his successor takes office in 2017.

But at a time when the president has identified climate change as one of his top policy priorities, an application that started as a routine regulatory matter has taken on outsized political importance in the United States. The company has rejected that view. “Given how long it’s taken, it’s — it seems unusual to me to suggest that somehow it should be paused yet again,” Earnest said. Some residents living along the pipeline’s route, including ranchers and farmers worried about the potential impact of a spill on local waterways, filed lawsuits and launched protests far from Washington. The company said a suspension of the review would be appropriate while it works to secure approval of its preferred route through Nebraska in the face of legal challenges.

TransCanada Chief Executive Officer Russ Girling, on a Tuesday earnings conference call, said the company’s request to the Secretary of State John Kerry had nothing to do with politics. Supporters of the $8 billion pipeline from the tar sands near Alberta, Canada, have argued the project would create construction jobs and drive down oil prices, which are already down 42 percent over the last 12 months amid a glut of crude. The 1,179-mile (1,900-kilometer) pipeline would run from Canada through Montana, South Dakota and Nebraska, where it would connect with existing pipelines to carry more than 800,000 barrels of crude oil a day from the Alberta oil sands to refineries along the Texas Gulf Coast. In an interview Tuesday, TransCanada spokesman Mark Cooper said the firm believes a delay is justified because the administration had suspended its review last year after the Nebraska route was challenged in the courts. Cooper said that none of the companies that have bid to ship oil through the pipeline have severed their contracts. “I think if you ask most of them, delayed new pipeline infrastructure is better for them than none at all.,” he said, adding TransCanada has “no intention of withdrawing our application” if State denies its request for a delay.

But after grass-roots climate activists began protesting outside the White House and wealthy Democratic donors took up the cause, the once-obscure application became a vexing question for the White House and a rallying cry for congressional Republicans. In 2013, he delivered a speech at Georgetown University saying he would only approve it if “does not significantly exacerbate the climate problem.” Late last year, he suggested the pipeline would do little to enhance the nation’s energy security. The Harper government was never credible on greenhouse gas reductions; this government could be very different.” Despite a sharp decline in oil prices, Girling said Keystone and other proposed pipelines remain viable. He said output is already high enough to make Keystone viable and added that pipelines are a cheaper option than moving oil by rail. “This project remains very much in demand by our customers,” Girling said. “Oil prices will not stay low forever but even if you think of when we made this application in 2008, the price of oil was $40 per barrel.

At that point, extracting oil sands crude would be much less profitable and the increased cost of shipping the crude by rail instead of pipeline could convince companies to shelve big projects, according to the most recent federal review. Many big projects expanding output are already in development, but oil companies like Royal Dutch Shell, Statoil and Teck Resources have put others on hold citing both price and the lack of transportation. All three Democrats seeking their party’s next presidential nomination now oppose the project, while the GOP’s 2016 presidential contenders all favor it. She is the author of two books—one on sharks, and another on Congress, not to be confused with each other—and has worked for the Post since 1998.

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