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What’s Left of the Keystone Story

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The National Journal has a long dive into the remaining possibilities for the Keystone XL Pipeline:

The next two steps in the protracted regulatory review process will be the State Department’s release of two documents: the final environmental impact statement and a related inspector general’s report. The IG for State has been investigating whether any conflict of interest exists between the company that did the administration’s environmental review and TransCanada, the company seeking to build the cross-border pipeline from Alberta to Texas.

Once those two documents are released—expected sometime in the next three months—other federal agencies will conduct nearly four more months of review before the administration makes a final decision on the permit. That means the Keystone XL saga isn’t poised to end until the middle part of 2014.

In September 2008, TransCanada first submitted its application to the State Department to build the 1,700-mile pipeline, which would send more than 700,000 barrels of heavy oil from Alberta to the Gulf Coast. You might recall that TransCanada is actually in the middle of the second regulatory review process, since President Obama rejected the company’s first application in the face of the GOP-imposed deadline in early 2012.

Over 5 years ago, TransCanada applied for a permit to build the pipeline. It was rejected, allegedly over concerns that it crossed over sensitive aquifiers, and Transcanada subsequently adjusted the route. They also, with implicit support from the White House, began building the southern portion of the pipeline, representing roughly 35% of the entire length of the pipeline.

Soon, the State Department will release its final report allowing the President to cast public judgement on the merits of the pipeline. Regardless of the outcome, there will likely be numerous lawsuits attempting to derail the construction of the pipeline, or outraged Republicans passing legislation attempting to force Obama’s hand on the pipeline.

The decision appears to depend on the extent to which the pipeline exacerbates carbon i dioxide emissions:

The draft environmental review the State Department released in March found that Keystone would indirectly add up to 830,000 metric tons of carbon dioxide a year—which is a tiny amount compared to the 32 billion metric tons of global carbon emissions from the entire energy sector overall—by helping enable Canada’s oil-sands development. Because of this relative small figure compared to the overall amount of carbon, the review concluded that Keystone “is unlikely to have a substantial impact on the rate of development in the oil sands, or on the amount of heavy crude oil refined in the Gulf Coast region.” This particular line made environmentalists worry the draft review was a sign the administration was going to green-light the project.

If the 830,000 figure is much higher, it could indicate the administration is leaning less toward a final answer of yes than it was before. If it’s lower or about the same, it’s a sign the administration is headed toward yes, still.

The State’s Department’s initial environmental review, released all the way back in summer 2011, came to a similar conclusion: ” … the overall contribution to cumulative [greenhouse-gas] impacts from proposed Project construction and operation would not constitute a substantive contribution to the U.S. or global emissions.”

Keystone proponents remain optimistic because each official review has given legs to the view that the pipeline won’t significantly increase carbon dioxide emissions. Unfortunately this also means that the pipeline isn’t overly important to the future of the tar sands, because it means that the State Department believes that most of this oil can also be transported by rail. (Though recall we have learned that rail is not nearly as safe as a pipeline.)

We have been told this before, but it finally appears that the Keystone decision will be made in early to mid 2014.

Read the entire National Journal article here.

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