Keystone Builder Asks Administration to Suspend Pipeline Review

The Obama White House is likely to nix the project. The next president might not.

AP Photo/Jacquelyn Martin

The company seeking to build the controversial Keystone XL oil-sands pipeline asked the Obama administration to suspend its review of the pipeline’s permit Monday.

In a letter to the State Department, which is handling the review, TransCanada Corp. said that the process should be put on hold until state officials in Nebraska complete a review of the proposed pipeline.

The request extends what has already been a much-delayed, seven-year review process for the Alberta-to-Gulf-Coast pipeline. But it also comes as President Obama has increasingly indicated that he would reject the pipeline, citing environmental concerns.

White House press secretary Josh Earnest told reporters Monday that the expectation was that Obama “will make a decision before the end of his administration on the Keystone pipeline, but when exactly that will be, I don’t know at this point.”

Another delay might render that statement moot—which could be exactly what TransCanada wants. Another pause is almost sure to push the review past the 2016 election, when the company may get to start again with a new, more friendly, administration.

All of the Republican presidential candidates say they support construction of the pipeline, with some even saying they’d approve it on Day 1.

“Suspending the Keystone XL permit application at this point would be absurd,” said Tiernan Sittenfeld, League of Conservation Voters senior vice president of government affairs. “This is nothing more than another desperate and cynical attempt by TransCanada to build their dirty pipeline someday if they get a climate denier in the White House in 2017.”

Pooja Jhunjhunwala, a State Department spokeswoman, said the department was reviewing TransCanada's letter and that, "‎in the meantime, consideration under the Executive Order continues."

While Obama has been mum about how—and when—his administration will rule on the project, he has said that it would have to pass a climate test. The president said that he would only approve the pipeline if it did not “sig­ni­fic­antly worsen” green­house-gas emis­sions.

Meanwhile, the Democratic candidates all soundly oppose the pipeline. Hillary Clinton—who had kept her silence for years, citing her involvement as secretary of State in the early review process—said in September that the project was “a dis­trac­tion from the im­port­ant work we have to do to com­bat cli­mate change” and that she was against it.

In September, TransCanada said it was seeking approval for the pipeline through the Nebraska Public Service Commission and withdrawing eminent-domain actions, a process that would have avoided lengthy court battles.

The permit application has been a protracted process that has loomed over the Obama administration, agitating environmentalists and fossil-fuel backers alike at every turn. It’s also been marked by frequent delays, including last year when the administration paused the review while the Nebraska Supreme Court considered a challenge to the project (the review was restarted after the court made its ruling in January).

“I note that when the status of the Nebraska pipeline route was challenged last year, the State Department found it appropriate to suspend its review until that dispute was resolved,” said TransCanada CEO Russ Girling in the letter. “We feel under the current circumstances a similar suspension would be appropriate.”

Republican Sen. John Hoeven of North Dakota, who has led a bipartisan push in the Senate to force the White House to approve the pipeline, said that the delay had been forced by the administration’s process and that it could impact future energy projects.

“If the long delay hasn’t already had a chilling effect on the willingness of other companies to invest in important energy infrastructure projects in the United States, an outright denial certainly would,” Hoeven said in a statement. “And TransCanada had been given every reason to believe its application would be denied by the current administration, despite the protracted review period and multiple favorable findings.”