Administration delaying Keystone XL decision until after 2012 election

The Obama administration said Thursday it will consider alternative routes for the Keystone XL oil pipeline to avoid ecologically sensitive areas of America’s heartland — a move that delays a final decision on the controversial project until after the 2012 election.

The move solves a political dilemma for President Barack Obama, who risked alienating key voting blocs no matter what decision he made on the pipeline that would carry Canadian oil sands crude from Alberta to Port Arthur, Texas. The project pitted environmentalists against some labor unions and the oil industry, and Obama would have been delivering a verdict before an election that could turn on who can do the most to turn around the nation’s ailing economy.

In a statement, Obama said the State Department made the right move.

“Because this permit decision could affect the health and safety of the American people as well as the environment, and because a number of concerns have been raised through a public process, we should take the time to ensure that all questions are properly addressed and all the potential impacts are properly understood,” Obama said. “The final decision should be guided by an open, transparent process that is informed by the best available science and the voices of the American people.”

Industry officials who back the pipeline accused the White House of playing politics by courting Obama’s environmental base at the expense of potentially thousands of construction jobs linked to the project.

“This is clearly about politics and keeping a radical constituency opposed to any and all oil and gas development in the president’s camp in 2012,” said Jack Gerard, president of the American Petroleum Institute. “It appears there is only one job that is being focused on here.”

Environmentalists cheered the decision as a major victory for the movement, coming just days after thousands of activists circled the White House to protest the pipeline. Environmentalists argue the project would make the U.S. more dependent on a form of bituminous oil that takes more energy to extract than other fossil fuels.

Residents along the planned 1,700-mile route also have warned about possible spills in the Nebraska Sand Hills and the Ogallala Aquifer that provides drinking water to 2 million people.

The State Department said it would examine “in-depth alternative routes that would avoid the Sand Hills in Nebraska,” in light of broad “national concern” about Keystone XL’s proposed 1,700-mile route.

Administration officials estimated that it would take until at least early 2013 to complete required environmental reviews of a new pipeline path — before the State Department could decide whether the project was in the “national interest.”

“We’re really looking at an approach that would minimize or avoid the Sand Hills region,” said Assistant Secretary of State Kerri-Ann Jones.

Jones insisted that the decision was not political.

“This decision is based on the process that we have been going through. This is not a political decision,” Jones said.
“The White House did not have anything to do with this decision. They did not direct us to make this decision.”

TransCanada Corp., which first sought approval for the project three years ago, said it would continue seeking a pipeline permit.

“We remain confident Keystone XL will ultimately be approved,” said TransCanada CEO Russ Girling.

But Girling acknowledged that may come too late for refiners who have inked contracts for crude that would be carried by Keystone XL.

“Supplies of heavy crude from Venezuela and Mexico to U.S. refineries will soon end,” Girling said. “If Keystone XL is continually delayed, these refiners may have to look for other ways of getting the oil they need. Oil sands producers face the same dilemma — how to get their crude oil to the Gulf Coast.”

At least one competitor, Enbridge Inc. is planning to build pipeline segments that also would allow Canadian crude to flow to southeast Texas refineries, providing an alternative to Keystone XL.

This “will send a signal to those refineries you need to continue to look to other parts of the world for your resources,” predicted API’s Gerard. And at TransCanada, he said, executives will be weighing whether it’s worth waiting another year — or longer — on a project that may never win approval:

“If you’re a business person and you’re looking at a legal process that has this much discretion in it that can be driven by political considerations, you’ve got to think twice about risking your shareholders’ assets, knowing that you can never complete the process” and “you’re at risk of every political whim,” Gerard said.

San Antonio-based Valero, the nation’s largest independent refiner, called the delay “unfortunate” and “short-sighted.”

“This decision is due to a small and misguided group of extremists who fail to realize that fossil fuels will continue to be consumed because they are efficient and economically viable,” Valero said in a statement. “The administration’s decision will actually increase greenhouse gas emissions because without this project, oil will be transported further and by more carbon-intensive means.”

Some organized labor groups have argued that approving the pipeline could swiftly put thousands of pipefitters and union members to work. And oil industry advocates insisted that Keystone XL would ensure the United States gets more of the oil it needs from a friendly North American ally while providing a new route for oil extracted from the Bakken shale in Montana to reach Texas refineries.

Environmentalists said the State Department’s move should kill the project. Larry Schweiger, president of the National Wildlife Federation, said the “do-over is likely a lethal blow.”

“The project won’t be able to stand the scrutiny because Americans now understand that it will increase our addiction to dirty, expensive tar sands oil for decades,” Schweiger said. “You can change the route, but it is still the wrong project at a time when we need investments in clean energy alternatives that don’t spill, don’t pollute and don’t run out.”

Susan Casey-Lefkowitz, director of the Natural Resources Defense Council’s international program, said Obama was “displaying leadership and courage by putting the interests of the American people before those of Big Oil.”

The State Department already looked at 14 different route options as part of its final environmental review of the pipeline.

But Jones noted the alternatives that the State Department studied did not include routes that avoided the Sand Hills while still going through Nebraska. The evaluation also came before public hearings in Nebraska that amplified residents’ concerns and before the state legislature convened a special session to explore ways to force an alternative path.

“It’s a very important issue for the state,” Jones said. “it’s a very unique area. We are looking at something that is new and that we had not done before, even though we had done all the appropriate work on alternative routes. We didn’t look at a route in Nebraska that avoided the Sand Hills.”

Following an environmental analysis, the State Department concluded in August that there would be “no significant impacts to most resources” in Keystone XL’s 1,700-mile path. The State Department also said potential spills from the pipeline “would likely be limited.” That kicked off a 90-day period for the State Department to evaluate whether the project is in the “national interest.”

Environmental advocates and congressional critics of the project had already implored the Obama administration to delay a final decision while the State Department’s inspector general probes whether the review process was tainted by bias and conflicts of interest.

Sen. Bernie Sanders, an independent from Vermont who caucuses with Democrats, applauded the State Department’s move.

“I strongly believe that the more the American people learn about this project, the more they will understand that it would be disastrous for our environment and for our economy,” Sanders said. “They will want the president to keep his promise that the United States will lead the world in combating global warming by rejecting this pipeline.”

Rep. Ed Markey, D-Mass., said “the Obama administration is right to reevaluate this pipeline.”

But Markey wants the administration to go further than studying a new route — and instead also thoroughly evaluate the carbon footprint of the oil sands crude Keystone XL would deliver to southeast Texas.

“President Obama should take into account the impact of increased Canadian tar sands production on the amount of carbon dioxide pollution in the atmosphere, and the looming deadline the world faces in averting the disaster of climate change,” Markey said.

34 Comments

  1. Adler

    The Obama administration pandering for votes from his leftist supporters. So what will they do a day/week/month after the election when he approves the pipeline anyway? Will they un-vote for him?

    #1
  2. printzapper

    The Ogalalla aquifer is a very fragile source of water that has already seen a vast amount of abuse. The replenishment rate currently is less than the usage rate and it certainly would be a major disaster if somehow it was damaged by an oil spill. Oh this can’t happen, right?

    #2
  3. KB

    Markey needs to freeze in the dark.

    #3
  4. Steven

    I think the most important point in all this is protecting the aquifer. Water in that region is already scarce, and endangering the water supply with an oil pipeline isn’t worth the risk. Re-route it. And even though it’s Canada, we’re still depending on foreign oil. That’s not energy independence. We must focus on developing renewable, sustainable domestic energy. It won’t be done with fossil fuels, though they’re a necessary evil to bridge the gap…

    #4
  5. Mike

    This is absolute BS. They’re postponing the decision until after the election so obama doesn’t upset a vital part of his base. The radical eco-fasists who contribute nothing to society. These leaches don’t want cheap oil because they know no one will buy the electric pieces of junk in which they’re so invested.
    Exactly where do these morons think electricity comes from? And the campaigner-in-chief continues his class warfare. Embracing scum like the Occupy-fill-in-the-blank bunch of losers while dissing the TEA Party and other hard working Americans. If he wants jobs, approve the freaking pipeline. That will create good paying construction jobs and most likely the refineries would need additional employees. And those jobs won’t cost the taxpayers a dime. Maybe that’s why he won’t step in and make an executive decision. He won’t control of where the money goes. obama is an insufferable fool. Everything he does is only because he wants 4 more years to finish off the country.
    Example: Yesterday he spoke before the Women’s Law Center and whined about Republicans not passing his latest spending bill. Because of that women will be poorer, healthcare will be more expensive for women, no more pap smears, no more breast cancer screening, and on and on it goes. He failed to mention that even democrats did not vote his bill.
    How can ANYBODY support what this incompetent fool has done and continues to do? He has nothing to advance our country. He’s only interested in tearing down to put us in our place. To tear down the evil conservatives. Don’t believe me? Look at what he’s doing to Herman Cain. These trailer trash whore accusers have been rounded up by none other than David Axelrod.

    #5
  6. Mike

    Hey printzapper and Steve, this has nothing to do with protecting the aquifer. It has everything to do with getting the community-rabble-rouser-in-chief re-elected.

    And exactly how would a pipeline affect the replenishment of the aquifer? That’s ridiculous. If it’s being drained at a rate greater rate than the replenishment rate it means it’s dying. Those folks are going to have to get water from somewhere else some day.

    #6
  7. Commrade_Leftist

    Thank Goodness there’s no oil and gas pipelines already in use!

    #7
  8. Jim

    Not approving this pipeline increases risk. Oil from Alberta is shipped to the midwest by rail tanker cars. Additional supplies will continue to be shipped by rail until there is an alternative. There will be a glut of refined products in the midwest, requiring product to be shipped to other parts of the country to supply market needs. Every time a volatile product is handled, the risk of an accident, explosion or spill multiplies. The Keystone Pipeline is by far the safest way to get supply to the U.S. The Canadians are engineering two other pipeline routes for the long-term possibility that the U.S. will defer to politics and lose out to other countries who want that oil. We are so screwed.

    #8
  9. Tourist

    If the citizens of this country can’t see that this is obviously a ploy to get votes in 2012 for the incumbent, then they are even more blind than anyone ever thought. I imagine all the protesters made their way to the various protest sites in non-fossil fueled vehicles, right? Wait, I know! Let’s all put little windmills on the top of our cars. That ought to do it! Of course, then the poor birds might get zapped by the propellers. What a bunch of whimps.

    #9
  10. Jim

    You people saying that we have to protect the Ogalalla aquifer and a pipeline might harm it, please explain how it would be damaged. Anything spilled at the surface would have to percolate down through layers of clay and rock, overcome hydrostatic balance and enter the aquifer in some permeable zone. Not going to happen. The aquifer is recharged specifically where hydrostatic pressure is lower, for instance at a higher elevation which could be hundreds of miles away in the mountains or elevated plains or where permeable sands outcrop and are fed by some fresh water or even brine water source. If leakage on the surface pollutes ground water in your estimation, why do we allow crankcase oil drips on parking lots, driveways and roads?

    #10
  11. ntangle

    Commrade_Leftist wrote: Thank Goodness there’s no oil and gas pipelines already in use!
    —————-
    Right on, Comrade! But just in case there actually are any being used, maybe they should be shut down until after the election.

    #11
  12. tamu1996

    There are too many cans in Washington being continually kicked down the road, often, as appears in this case, for the sake of political expediency and gain.

    A pox on both parties for their willful, political, self-serving negligence of our country’s affairs……

    #12
  13. meetwoodflac

    Jim, you are fighting uphill here. These people do not have the skills necessary to analyze what factors are in play with aquifers, etc. they are handed printed scripts to blather about their eco-worries.

    #13
  14. Turtles Run

    To all you that are saying this is political remember this. Nebraska which is calling for the pipeline to be re-routed has a Republican Governor. Governor Dave Heineman has expressed many times the danger that this pipeline poses to their water supply. So unless the President is pandering to Republicans now, your comments are wrong.

    #14
  15. texdjd

    But I thought you wanted to create jobs Mr. obummer- What a crock of b.s. it is to delay this.

    #15
  16. ProfesorC

    The Obama administration votes Present.

    #16
  17. ntangle

    Oil from Alberta is shipped to the midwest by rail tanker cars.
    ———————–
    That would’nt be very economic all the way from Canada, as bitumen crude is already shipped to the Midwest en masse by the existing Keystone pipeline and at least two other pipeline carriers (eg., Enbridge & Kinder Morgan). It gets as far as Cushing, OK, where there’s a glut of it, hence its low price there. There’s been some small scale shipment to the Gulf Coast via rail cars. The XL pipeline that’s being held up would have been a more direct route to Cushing and the Gulf Coast, had it been allowed thru Nebraska.

    #17
  18. TXSFRED

    Aw it ain’t political at all. It’ just President Barack Hussein Obama trying to vote “present” again – like he did in Illinois and the US Senate. He took Paper Trail 101 as a College Freshman. If he had just kept his mouth shut or taken No Video 101. why he’s be a hero.

    #18
  19. ntangle

    Supplemental: Existing major commmon carrier routes to the Midwest go to Chicago, Michigan, and the St. Louis area. There are smaller lines that carry crude (including bitumen) as far south as Cushing, OK.

    #19
  20. chiefdecoy

    What a political coward!

    Thought Obama was “different”????

    #20
  21. chiefdecoy

    Exxon, the biggest American oil company, reported earnings of $10.7 billion for the quarter, up from $7.56 billion the year before, but a bit less than Wall Street had been expecting. Shell, the largest European oil company, posted profits of $8.7 billion, up from $4.4 billion a year ago.

    http://www.nytimes.com/2011/07/29/business/global/exxon-and-shell-earnings.html
    ======
    Hey Turtles, It appears that that Obama is actually an oil company’s new, “BFF”.
    After all, they seem to be doing quite well under his rule. Not to mention how his friend Soros, who is heavily invested in Brazilian oilfields, is making out on all the new found drilling and equipment relocation to that neck of the woods. Could their be a relation to a lack of contracts in the U.S.? Nahhhh,,,,,Purely coincidence. (insert sarcasm)
    People in glass houses and all…..

    #21
  22. olddispatcher

    With the Enbridge announcement yesterday this pipeline is looking more like a moot point anyway. There are several companies that are working on moving Cushing oil to the Gulf Coast; this is called competition.

    The backers of this line will likely want to build it anyway if there is a dollar to be made from it. There is nothing wrong with that, but if the money is there to be made other pipeline companies will be there to provide the means to move the oil.

    This reminds me of another pipeline project from the 80′s that was designed to bring crude from California to Midland. One got built by a company called All-American and one did not by a company called Pacific-Texas (I think that was their name). It just all came down to who was able to satisfy the customers first.

    For those of you that want to make something political out of this then all I can say is to knock yourself out. But those of us that have been in this business for the last 50 years have seen all of this before, and as far as this becoming an election issue…. Keep dreaming.

    #22
  23. Govchance

    The country is in desparate need of the economic stimilus, the jobs and oil from a friendly, secure source, all of which this pipeline would provide. The sooner this communist is removed from the White House, the better. Hopefully, the republicans have enough sense to use this issue to beat him over the head with it, once the general election cycle begins.

    #23
  24. Calico

    So what does Rep. Gene Green have to say about this. The Comical has described Gene as the Democrat’s “go-to” guy on energy.

    #24
  25. Spiff

    Cowards. They care more about votes in the election than minimizing our dependence on middle eastern oil.

    #25
  26. jbd2

    It is a great wrong ( as in borderline crime ) to not make a timely decision. Lots of people are trying to make plans for their future and their money. If the answer is no, at least they could do something else.

    Either Obama is clueless about the punishment he is putting on the affected people or more likely, he perfers his own reelection.

    #26
  27. max hayes

    I would have bet that Obama would have caved to the unions, guess he just is not interested in jobs,except his own reelection

    #27
  28. Jim P

    So much for shovel ready jobs. Another example (as if we needed one) of Obama’s lack of leadership and willingness to make a tough decision.

    #28
  29. TexKen

    Doing what this president does best, fiddling while we burn.

    #29
  30. Peeper

    Barry risking national security for political gain. Hmmm sounds familiar. This guy is so crooked they are going to have to screw em in the ground when he goes.

    #30
  31. Dollar

    Peeper, political gain is just another form of greed.

    OWS protestors condemn Wall Street for greed, but have no problem with politicians who are greedy for power.

    #31
  32. miles vermillion

    Hi,

    As a Canadian living in Alberta, I am quite surprised at the perception of the Oil Sands in the US (and the rest of the world, including Canada for that matter).

    The problem seems to be that the Oil Sands have become a “lightning rod” for environmentalists everywhere who seem to believe there is some easily organized and distributed “clean” renewable energy source available.

    Someday, sure, but not for a few decades at least. In the meantime, we all need oil and the thousands of products that are produced from it. Our whole economic system is based on the huge energy that is produced by oil. I do however, agree with continued research on how to minimize the impact of oil sands mining.

    What is most confusing to me is that , to quote one of our newspapers, … “The oilsands account for of 0.1 per cent of global greenhouse gas emissions. Their emissions in 2009 were equivalent to 3.5 per cent of emissions from the U.S. coal-fired generation sector. Why aren’t the activists out attacking America’s “coal bomb?”

    And if the environmentalist were really serious about global emissions they would be focussing on China and India where the present and future increases in emissions are much, much greater than the Canadian Oil Sands.

    The Canadian oil sands are crucial for our country, and the US for that matter. We would sooner work with our neighbours in the US than shipping it to Asia, but if it comes to that situation, we will export to Asia…

    Some of the readers in the Houston Chronicle may be interested in the following link to an article in one of our national newspapers. The basic gist of the article is that the Canadian oil sands are (very conservatively) estimated to be worth $14 Trillion dollars to Canada at only $80 per barrel. This figure is 10 x our GDP. To put it into US figures, if the oil sands were in the US they would be valued at 145 Trillion dollars…

    It doesn’t take a rocket scientist to realize that Canada will continue to develop and sell our resources. Just like every other country.

    http://business.financialpost.com/2011/10/26/will-canada-walk-away-from-a-14t-resource-asks-economist/

    Cheers,

    #32
  33. Dollar

    @miles vermillion, you are correct, the tar sands have become a lightning rod.

    And the other one is hydraulic fracturing.

    And the enviro’s have done an excellent job of making both dirty words in most US households, even though most US citizens know nothing of either one.

    #33
  34. Tex

    I do not understand why Rep. Ed Markey and the Obama administration would have a say in pipeline routes.

    This should be a decision made by the affected states and not by the incompetent Washington Day Care (DC) members.

    #34