Keystone report raises pressure on Obama to approve pipeline

Fri Jan 31, 2014 6:08pm EST
 
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By Roberta Rampton and Jeff Mason

WASHINGTON (Reuters) - Pressure for President Barack Obama to approve the Keystone XL pipeline increased on Friday after a State Department report played down the impact it would have on climate change, irking environmentalists and delighting proponents of the project.

The agency made no recommendation in its report on whether Obama should grant or deny an application by TransCanada Corp to build the $5.4 billion line, which would transport crude from Alberta's oil sands to U.S. refineries.

But the State Department said that blocking Keystone - or any pipeline - would do little to slow the expansion of Canada's vast oil sands, maintaining the central finding of a preliminary study issued last year.

The 11-volume report's publication opened a new and potentially final stage of an approval process that has dragged for more than five years, taking on enormous symbolic political significance and looming over Obama's environmental and economic legacy.

"President Obama is out of excuses," said John Boehner, the Republican Speaker of the House of Representatives and a big Keystone proponent. "If President Obama wants to make this a 'year of action' he will stand up to the extreme Left in his own party, stand with the overwhelming majority of American people, and approve this critical project."

With another three-month review process ahead and no firm deadline for a decision on the 1,179-mile line, the issue threatens to drag into the 2014 congressional elections in November. Obama is under pressure from several vulnerable Democratic senators who favor the pipeline and face re-election at a time when Democrats are scrambling to hang on to control of the U.S. Senate.

The report offered some solace to climate activists who want to stem the rise of oil sands output. It reaffirmed the idea that Canada's heavy crude reserves require more energy to produce and process - and therefore result in higher greenhouse gas emissions - than conventional oil fields.

But after extensive economic modeling, it also found that the line itself would not slow or accelerate the development of billions of barrels of reserves that environmentalists say would exacerbate global warming. That finding is largely in line with what oil industry executives have long argued.   Continued...

 
Protesters rally about the Keystone XL oil pipeline along U.S. President Barack Obama's motorcade as he arrives at the Jefferson Hotel in Washington July 11, 2013. REUTERS/Yuri Gripas