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No Keystone XL pipeline this year, following new delay

WASHINGTON — The Keystone XL pipeline project appears paralyzed for another year, with the U.S. administration announcing another delay in a process already beset by political and legal challenges.

The American administration shrugged off a demand from the Canadian government for an immediate decision on the controversial pipeline, so that construction could begin this summer.

The State Department announced Friday that eight federal agencies had been informed they will have more time to weigh in, given the uncertainty created by a court dispute in Nebraska.

Congressional staffers were informed, via conference call, about the delay caused by the Nebraska dispute. That court case is not expected to be resolved until the end of this year, at the earliest.

“Agencies need additional time based on the uncertainty created by the on-going litigation in the Nebraska Supreme Court which could ultimately affect the pipeline route in that state,” said the announcement from the State Department.

There had been speculation about whether the Obama administration might try to punt the politically sensitive decision until after this year’s midterm elections.

While the project appears to have support from the general public, it has divided Barack Obama’s Democratic party — pitting big-money environmentalist donors against red-state conservative Democrats afraid of losing their congressional seats this fall.

In an attempt to push the process along, Foreign Affairs Minister John Baird spent several days in Washington recently pleading for a decision soon —arguing that it would be unfair to keep construction workers and the industry hanging as the building season approached.

A spokesman for Prime Minister Stephen Harper labelled the American decision as a political one.

“We are disappointed that politics continue to delay a decision on Keystone XL,” Jason MacDonald said in an email Friday.

“This project will create tens of thousands of jobs on both sides of the border, will enhance the energy security of North America, has strong public support, and the U.S. State Department has, on multiple occasions, acknowledged it will be environmentally sound,” he said.

The project was tossed into further disarray by a recent Nebraska court ruling that the state government there broke the law in its attempt to unilaterally dictate a route.

The case is being appealed to the state supreme court. Until then, even a presidential permit to allow the pipeline to cross the border would have slammed into uncertainty given the confusion over the route.

“President Obama... has said all along he wants to follow the process,” said Jane Kleeb, a Nebraska activist who has been fighting Keystone for years.

“The basic fact that Nebraska has no legal route is reason to delay any decision until our state can analyze a route using a process that follows our state constitution.”

She said the project’s problems could continue to grow.

She said the Nebraska high court isn’t expected to rule until next January, and if it upholds a lower-court decision the pipeline planners could be forced back to the drawing board.

Meanwhile, she said, South Dakota’s permit expires June 20 — also, which means pipeline-builder TransCanada Corp. will have to reapply for a permit in that state, as well.

The southern leg of the Alberta-to-Texas pipeline is already completed, but the northern stretch that crosses the Canada-U.S. border requires a presidential permit.

With that process delayed, rail shipments of Alberta crude have skyrocketed, threatening a broader trickle-down effect throughout the transportation system.

 
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