President Obama has used an executive order to change the direction of a Department of State approval process concerning the controversial application by TransCanada for the proposed Keystone Pipeline project.
Prior to Obama’s intervention, the State Department was well on its way to approving the pipeline (which would then require the President’s signature) when questions about potential conflicts of interest arose regarding a high priced lobbyist, a former employee of Secretary of State Hillary Clinton. Those allegations are currently under investigation by the Inspector General.
Serious objections were also raised about the proposed route’s impact on the Sand Hills of Nebraska. This resulted in the Nebraska legislature convening a special session to explore legal ways to head off what environmentalists say is a natural disaster in the making, if the critically important Ogallala Aquifer is damaged by an oil spill.
Obama caught between his political desire to appear to be encouraging energy independence and his need to bolster waning support among environmentalists in what could be a tough bid to keep his job next year, today ordered State to look at alternative routes that would avoid the Sand Hills in Nebraska. This effectively kicks the political problem down the road until after the 2012 Presidential election. Nevertheless, it does not address larger policy and environmental issues surrounding the tar sands derived oil pipeline.
Reevaluation of the project could take up to 18 months. Moreover, costs associated with this delay could kill the project. The White House leaked the Keystone Pipeline decision to favored news organizations earlier today before concurrent releases from the White House and State Department were issued this afternoon.
The Keystone XL pipeline was originally proposed in 2007, building off another existing TransCanada oil pipeline. Since it crossed the U.S.-Canadian border, State Department approval was required. Keystone XL would run about 1,750 miles, mostly – but not entirely – below ground. The $7 billion project would ship up to 700,000 barrels of oil a day to the Gulf Coast, where much of it would be exported. TransCanada has spent about $1,000,000 lobbying the State Department, according to publicly available records.
“Because this permit decision could affect the health and safety of the American people as well as the environment, and because a number of concerns have been raised through a public process, we should take the time to ensure that all questions are properly addressed and all the potential impacts are properly understood,” said Obama in a statement.
