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Keystone Pipeline Gets a Boost From State Department

Pipe is stacked at the southern site of the Keystone XL pipeline in Cushing, Oklahoma.
Getty Images
Pipe is stacked at the southern site of the Keystone XL pipeline in Cushing, Oklahoma.

The Keystone XL oil pipeline got a boost on Friday when the U.S. State Department said the project would not likely change the rate at which Canada's oil sands are produced, discounting fears it would be responsible for additional greenhouse gas emissions.

TransCanada's proposed project is "unlikely to have a substantial impact" on the development of Alberta's oil sands, the world's third richest oil deposit, the Department said in a long-awaited report of more than 2,000 pages.

The report also said the more than 800,000 barrel per day pipeline would have little environmental effect on most resources along its proposed route, provided the company takes certain measures to make it safer.

Supporters of the project that would bring oil to Texas refineries have dismissed concerns it would lead to additional greenhouse gas emissions, saying the oil would reach markets regardless of whether the pipeline is built.

President Barack Obama rejected the line in 2011 on concerns about its route through ecologically sensitive regions of Nebraska and after several high profile spills on lines carrying Canadian crude.

Subsequently TransCanada issued a new route for the pipeline, which Friday's assessment took into consideration.

The State Department stressed that the report did not judge the project. The public will have 45 days to comment on the review starting next Friday. A final decision by the Obama administration is not expected until July or August.

State Department Assistant Secretary Kerri-Ann Jones repeatedly refused to address whether the report offered support for building the pipeline or not, instead telling reporters on a press call that it would be premature to draw conclusions from the environmental assessment.

"We're really looking for the public debate at this point," Jones said. "We're looking for the feedback from the public to help us shape this going forward."

Friday's report is far from the last word on Keystone. The environmental assessment must be finalized after the public comment period. Then federal agencies will have 90 days to work with the State Department to determine whether the pipeline is in the national interest.

A decision on Keystone has been pending for more than 4-1/2 years.

Many environmentalists oppose the project because oil sands are more carbon-intensive to produce than average crudes used in the United States.

One of Keystone's top critics said the review was little different from the earlier U.S. assessment.

"We're hearing the same rehashed arguments from the State Department about why a great threat to the climate is not a threat at all," said Bill McKibben, the founder of 350.org, an environmental group.

"Mother Nature filed her comments last year — the hottest year in American history; the top climate scientists in the U.S. have already chimed in. The rest of us have 45 days to make our voices heard, and we will," he said.

Supporters of Keystone say it would provide thousands of jobs, drain a glut of domestic crude oil from the North Dakota oil boom and strengthen North American energy security.

"The Keystone XL pipeline will make more Canadian and U.S. oil available to us - oil that will not need to be imported from unfriendly places," said Karen Harbert, president of the U.S. Chamber's Institute for 21st Century Energy.

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