Rumors swept through Washington late Thursday that the
long-delayed review of the 1,179-mile (1,900-km) pipeline to
bring oil from Canada to Nebraska would finally be released as
soon as Friday.
"The Environmental Impact Statement is in the final stages of
preparation and we anticipate a release of the document soon," a
senior State Department official said late on Thursday, speaking
on condition of anonymity.
The comment gives a clearer insight into where the long-awaited
assessment stands. One government official said the overdue
report, part of a process lasting more than five years that has
strained relations with Ottawa, would be released on Friday.
Supporters say the TransCanada Corp project would create
thousands of jobs and reduce U.S. reliance oil imports from
nations that are less friendly than Canada. They also point to
U.S. government reports about the dangers of moving crude oil by
rail as an alternative to the pipeline.
Critics of the pipeline plan say it would harm the environment
and hasten climate change by promoting oil-harvesting methods in
Alberta that produce high levels of carbon dioxide emissions.
After several more steps that could take months, the final word
on Keystone will come from the president.
A decision in favor of the pipeline could undermine Obama's
environmental credentials and anger activists who are some of
the Democratic Party's strongest supporters. A decision against
the pipeline could undercut Obama's pledge to boost employment
and U.S. energy security while alienating an important
international ally and oil supplier.
REPORT MAY DISAPPOINT ENVIRONMENTALISTS
Canadian officials said this month they expected the report to
come out soon after Obama's annual State of the Union speech,
which took place Tuesday.
And the American Petroleum Institute, the oil industry's top
lobbying group, has predicted that the report could be released
this week, citing administration sources.
"We're expecting to hear the same conclusion that we've heard
four times before: no significant impact on the environment,"
Jack Gerard, API president, told Reuters in an interview last
Most indications for some time have been that the updated report
will hew close to last year's draft, which said the project will
not add substantially to carbon emissions.
That is sure to disappoint environmentalists. But the report is
likely to show a nuanced interpretation of the environmental
benefits and costs of Keystone.
The project involves building a pipeline from Alberta, Canada,
to Steele City, Nebraska, where it would connect with a
previously approved line. That would create a system that could
move more than 800,000 barrels of crude per day from Alberta's
oil sands to refineries on the U.S. Gulf Coast.
The State Department official emphasized that the release of the
final environmental statement for the pipeline was "not a
decision but another step in the process prescribed by the
The release of the environmental review starts the clock running
on another review period, during which eight U.S. federal
agencies will have 90 days to comment on whether Keystone XL is
in the national interest.
Some agencies, including the Departments of Defense, Commerce,
and Energy, are expected to focus on the energy security and
economic case for the pipeline.
But the Environmental Protection Agency and the Department of
Interior, which have expressed reservations about the pipeline
in public comments, are among the other bureaus that will weigh
Sources on Capitol Hill and in the administration said recent
talk about the review was that the environmental community would
be disappointed, suggesting a favorable view, on net, of the
But the findings will not be a one-way street.
"Environmentalists will likely be disappointed until they read
the whole report," said an official who had seen a draft but
declined to discuss the findings in detail.
A report pending from the State Department's independent
Inspector General was likely to be issued at the same time as
the State Department's review, sources said.
The Inspector General has been investigating a possible conflict
of interest surrounding the company that did the original
environmental review, Environmental Resources Management.
(Reporting by Lesley Wroughton, Jeff Mason, Roberta Rampton,
Timothy Gardner and Patrick Rucker; writing by Ros Krasny;
editing by Eric Walsh and Lisa Shumaker)
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