State Dept: Er, we’re gonna’ need to delay that Keystone pipeline another few months

posted at 7:31 pm on February 1, 2013 by Erika Johnsen

A couple weeks back, Nebraska Governor Heineman approved the portion of the proposed Keystone XL pipeline that would run through his state, obliterating the Obama administration’s last, best excuse for continuing to delay on what has become a politically explosive project. After what have already amounted to years of various reviews with positive results, the State Department insisted that they just needed a little bit longer to finalize yet another one of these reviews, and that if everyone could just wait until the end of March, they should have their final decision by around then.

Yeah. About that. Reuters reports:

The Obama administration’s decision on the Keystone XL oil pipeline will not be made until at least June, a U.S. official said, which would delay the project for months and frustrate backers of Canada’s oil sands.

“We’re talking the beginning of summer at the earliest,” said the source, who did not want to be identified due to the sensitive nature of the TransCanada Corp project, which has been pending for more than four and a half years. “It’s not weeks until the final decision. It’s months.” …

“The fact the administration is taking its time suggests … that it wants to succeed with an airtight story that pleases the primary concerns of both sides,” said Kevin Book, an analyst at ClearView Energy Partners in Washington. …

The delay is painful in Canada which is suffering persistent, discounted prices for its oil because tight pipeline capacity. The premier of the Western Canadian province of Alberta warned last week that it faced a $6 billion revenue shortfall due to current pipeline constraints.

Blergh. Typical. Faced with the warring factions of vociferous environmentalists versus the pipeline’s various wealth-and-jobs-favoring proponents pulling them in both directions, the Obama administration just can’t seem to make the tough decision (which, by the way, will only decide whether the oil sands in question are purchased by us or China, not whether they will be used at all).

I have serious doubts that they’ll ultimately shut the project down, and I’m guessing they’re just searching for another awesome greenie-project or major regulatory announcement with which they can assuage and distract the environmental lobby when they finally do say yes — but if they’re hoping that the high-profile project will somehow lose steam among the public in the meantime, I think they’re going to be disappointed.

After a six-year campaign by green activists to brand them as a climate change villain, two major decisions will either validate the campaign against the oil sands or rehabilitate their reputation are expected this spring: U.S. president Barack Obama’s ruling on the proposed Keystone XL oil sands pipeline, and a European Union vote on whether to label the oil sands as more polluting than other oils in its Fuel Quality Directive. …

The decisions will open or close markets, help fix or entrench the deep discounting of Canada’s oil because of insufficient pipeline capacity and uncertainty about future markets, show how far jurisdictions are prepared to go to shape — and shame? — others’ economic choices and environmental standards in the name of the climate.


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