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TransCanada Suspends Keystone XL Pipeline Permit Request

Tens of thousands of demonstrators protest the proposed Keystone XL oil pipeline in Washington, DC on February 17, 2013. (Photo: Jmcdaid/Wikipedia)

Tens of thousands of demonstrators protest the proposed Keystone XL oil pipeline in Washington, DC on February 17, 2013. (Photo: Jmcdaid/Wikipedia)

TransCanada, the company seeking to build the Keystone XL oil pipeline, has asked the US government to suspend its permit application, a move that may delay a final decision on the controversial project until after President Barack Obama leaves office.

TransCanada made its request in a Monday letter to US Secretary of State John Kerry, explaining that it wishes to suspend its application while the company undergoes a state review process in Nebraska that it previously resisted. Opposition to a planned route through the state has delayed that process; the Calgary, Alberta-based company says it needs time for “certainty regarding the Nebraska route.”

“On October 5, TransCanada filed an application with the Nebraska Public Service Commission for approval of its preferred route in Nebraska,” the letter states. “We have taken this action in light of litigation in Nebraska which called into question the constitutionality of the statute under which Governor Heineman had approved the route in 2013. It is anticipated that the route approval process before the Public Service Commission will take seven to twelve months to complete.”

TransCanada’s request came as the State Department progressed through the final stages of review, with many observers expecting a rejection of the company’s permit as soon as this week. Coupled with continuing low oil prices, the move is all but certain to delay a final decision on the pipeline until after next year’s presidential election. President Obama has been faced with the politically fraught decision of whether or not to allow the construction of the 1,179-mile (1,897-km) pipeline that would carry some 800,000 daily barrels of petroleum from Canada’s oil sands through six US states down to the Gulf of Mexico.

Seeking to balance commitments to both the economy and the environment, the Obama administration has at times been ambiguous about its stance on Keystone XL. The administration has alternated between rejecting the pipeline and suggesting that it could be built if it does not significantly increase greenhouse gas emissions.

Tiernan Sittenfeld, senior vice president of government affairs at the League of Conservation Voters, told the New York Times that TransCanada’s request is a “desperate and cynical” attempt to salvage the project.

“TransCanada is losing, and they’re trying to preserve their options to be able to build the pipeline someday if they can get a climate denier in the White House,” asserted Sittenfeld. “Given President Obama’s incredible leadership when it comes to climate change, we remain very confident that he will reject this dirty and dangerous pipeline once and for all.”

All Republican presidential candidates support Keystone XL, while all the Democratic candidates say they oppose it. The project lost key support with the ouster last month of long-ruling Conservative Prime Minister Stephen Harper, a staunch pipeline supporter, and with the election in May of a left-leaning New Democratic Party government in Alberta that has stopped pro-pipeline lobbying. Prime Minister-elect Justin Trudeau says he supports Keystone XL but will not make the pipeline a priority in Canadian-US relations.

Since it first applied for a permit in late 2008, TransCanada, which has spent at least $2.5 billion on the project to date, has faced fierce resistance from environmentalists, indigenous groups and landowners who say the pipeline will put people and wildlife at risk from toxic oil spills, polluted water and other dangers.

“The Keystone XL pipeline will slice through America’s agricultural heartland, the Missouri, Platte, and Niobrara Rivers, the Ogallala aquifer, habitat for sage grouse and sandhill cranes, walleye fisheries and much more,” warns the National Wildlife Federation. “Our public water supplies, croplands, and recreational opportunities will all be at risk of dangerous tar sands oil spills like the million-gallon Enbridge oil spill in Michigan.”

Pipeline backers on both sides of the border say the project will help transform Canada into an energy superpower, create thousands of jobs and reduce American dependency on Middle Eastern oil.

Sen. John Hoeven (R-ND), a vocal Keystone XL supporter, blamed the Obama administration’s lengthy review process for TransCanada’s suspension request.

“It is clear President Obama was going to deny the permit,” Hoeven told the Wall Street Journal. “The costly delay has prevented the company from proceeding on a new pipeline that would have brought oil… to US refineries and jobs and revenue to local communities.”

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