TransCanada gets OK for south part of oil pipeline

[July 28, 2012]  HOUSTON (AP) -- A Canadian company that wants to build an oil pipeline from Alberta's tar sands region to Texas refineries has received a final permit for the Gulf Coast portion of the project and announced Friday that construction on the 485-mile section would start in the coming weeks.

President Barack Obama encouraged TransCanada to move ahead with the segment that will run from a refinery in Cushing, Okla. to Texas after he rejected the broader plan, saying the pipeline needed to be rerouted around Nebraska's sensitive Sand Hills region. For that project, TransCanada needs presidential approval because it crosses an international border. The shorter portion only requires permits from state and federal agencies. TransCanada said the final of three permits it needed from the Army Corps of Engineers had been approved.

"Receiving this final, key Army Corps permit for the Gulf Coast Project is very positive news. TransCanada is now poised to put approximately 4,000 Americans to work constructing the $2.3-billion pipeline that will be built in three distinct `spreads' or sections," Russ Girling, TransCanada's president and chief executive officer, said in a statement.

The line from Cushing will help relieve a bottleneck at the Oklahoma refinery, but doesn't fulfill TransCanada's broader goal of transporting more Canadian crude to U.S. refineries. Pipeline advocates say that would help decrease U.S. reliance on oil from unstable, sometimes unfriendly, countries, and provide much-needed jobs to an economy suffering from 8.2 percent unemployment.

But critics argue the tar sands oil is dirtier than most other heavy crudes refined in the United States and will further harm the air in the already polluted Gulf Coast. They also believe the crude's more acidic properties increase the risk for accidents and spills.

Chris Wilson, an organizer with Stop Tarsands Oil Pipelines, condemned the permitting of the pipeline.

"It appears that President Obama is only too happy to turn up the flow of toxic tar sands through our states, but we're here to say, `Don't mess with Texas or Oklahoma,'" Wilson said in a statement. "TransCanada executives may be smirking today, but they've got another thing coming if they expect landowners and tribes to simply roll over for their dangerous pipeline."

The issue took on political importance when Republicans forced a deadline on Obama to rule on the broader 1,179-mile Keystone XL pipeline. Obama, saying it required further review and should be rerouted to avoid an area where a vital aquifer flows close to the surface, rejected the plan. TransCanada has since resubmitted a new plan to the U.S. State Department.

"The Gulf Coast Project and the entire Keystone system will further help the U.S. achieve true energy security," Girling said. "I continue to believe Americans would prefer to consume their crude oil from domestic producers and from Canada rather than higher-priced oil from countries that do not share American values."

[Associated Press; By RAMIT PLUSHNICK-MASTI]

Ramit Plushnick-Masti can be followed on Twitter at https://twitter.com/RamitMastiAP.

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