UPDATE 2-Canada PM disappointed on Keystone but sees fresh start with Obama

Fri Nov 6, 2015 4:21pm EST
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(Adds remarks from Kenney, Dion and Notley, implications for Energy East)

By Randall Palmer and Leah Schnurr

OTTAWA Nov 6 (Reuters) - Canadian Prime Minister Justin Trudeau said on Friday he was disappointed at the U.S. decision to block the proposed Keystone XL oil pipeline but didn't see it standing in the way of improving relations between the two countries.

Canada's newly elected Liberal government also reiterated it was prepared to support domestic pipeline projects like TransCanada Corp's Keystone alternative Energy East, but only if there was buy-in from local communities.

While he openly backed Keystone XL ahead of last month's Canadian election, Trudeau made clear he would adopt a different tack than the outgoing Conservatives, who irritated the U.S. administration with constant pressure to approve the cross-border pipeline.

"The Canada-U.S. relationship is much bigger than any one project and I look forward to a fresh start with President Obama to strengthen our remarkable ties in a spirit of friendship and cooperation," the Liberal leader stated.

"We are disappointed by the decision but respect the right of the United States to make the decision."

By contrast, prominent opposition Conservative legislator Jason Kenney characterized the U.S. move as "insulting" and accused Trudeau of waving the white flag.

Trudeau has been vocal about the need to fight global warming and had not raised the pipeline with Obama when the President congratulated him on his electoral victory last month. He plans to meet Obama during a Nov. 15-16 summit in Turkey.   Continued...