US review of Keystone XL may be put on hold – UPDATED

UPDATE Nov. 5, 2015: US Secretary of State John Kerry denied TransCanada’s request to suspend the review process of Keystone XL pipeline (Reuters, Nov. 4, 2015).

TransCanada Corp asked the Obama administration to suspend its ongoing review of the Keystone XL pipeline on Monday (Nov. 2). The Canadian company is seeking to build a 1,179-mile pipeline that would transport 800,000 barrels of petroleum each day from the oil sands in Alberta, Canadian to the US Gulf Coast. Because of the cross-border nature of the pipeline, the project requires approval from the US State Department.

It is still unclear is the US government will grant the request to put the review on hold. According to the New York Times, State Department spokeswoman Pooja Jhunjhunwala said, “We have just received TransCanada’s letter to Secretary Kerry and are reviewing it. In the meantime, consideration under the executive order continues.”

TransCanada claims in its letter to Secretary of State John Kerry that the company has requested the delay to first resolve disputes with landowners regarding the pipeline route in Nebraska: “In order to allow time for certainty regarding the Nebraska route, TransCanada requests that the State Department pause in its review of the presidential permit application for Keystone XL. This will allow a decision on the permit to be made later based on certainty with respect to the route of the pipeline.”

In any case, the move to request a delay signals that continued uncertainty is preferable to rejection of the $8 billion infrastructure project from the increasingly environmentally focused President Obama. Environmentalists in the US see this as TransCanada’s attempt to avert a rejection from the Obama administration, and delay the decision until after next year’s presidential election.

The low price of oil and shift in Canadian politics may also play a part in TransCanada’s request to suspend the Keystone XL review. Since the federal application was first submitted for the project in 2008, oil prices have dropped from $150 to $50 a barrel. In terms of Canadian politics, recent elections of a more liberal Canadian prime minister and provincial government in Alberta mean that there is currently less support for the project than there had been previously.



(Image: pipeline in Alberta. Photo credit: taylorandayumi/Flickr.)