U.S. may delay pipeline decision past 2012 election

Wed Nov 9, 2011 6:59pm EST
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Arshad Mohammed and Timothy Gardner

WASHINGTON (Reuters) - The United States may choose to reroute a proposed Canada-to-Texas oil pipeline, a move that could defer a decision on approving the politically charged project beyond the 2012 U.S. election, a U.S. official said on Wednesday.

Studying a new route for the Keystone XL pipeline, which is opposed by many environmentalists and backed by industry, could take 12-18 months, the official said. That would put a final decision after President Barack Obama's re-election bid in November 2012.

The U.S. official said the time would be needed to examine the environmental impact of TransCanada Corp's $7 billion Keystone XL project, considered the most important North American oil pipeline plan for several decades.

"The best judgment is somewhere between a year and 18 months," the official, speaking on condition of anonymity, told Reuters, saying the assessment could happen faster but was unlikely to be completed in less than a year.

Mark Routt, an analyst at the KBC consultancy in Houston, said the delay could scuttle the proposal. "To delay the decision on Keystone XL is in effect a decision itself," he said. "I think in all likelihood that a delay would kill the project."

A TransCanada spokesman said on Wednesday a delay would not make sense and would leave the United States dependent on tanker traffic and oil imports from the Middle East.

Some of Obama's liberal supporters have strongly opposed the project and delaying a decision could allow him to avoid antagonizing environmentalists disillusioned with his progress on climate change.

Green groups, which are part of the president's voter base, have rallied to oppose development of the oil sands, which they say release more carbon dioxide than other crude oils   Continued...