API pushes for US state action on Keystone XL project

The trade sector recently commented that the Obama administration is no longer in a position to stall the approval of the Keystone XL pipeline.  Prolonged deferment of oil-related projects may impact on sectors dealing with oil investment, production, and refining.

TransCanada has presented to Nebraska authorities a comprehensive report containing an alternative pipeline route which will steer clear of the Ogallala Aquifer in the Sandhills region. The aquifer supplies more than 80 percent of the fresh water requirements of people living near the region, and threats of contamination such as oil leaks from a nearby pipeline may pose tremendous risks.

Keystone pipeline proponents pointed out that the suggested route will traverse Alberta’s oil sands until it reaches oil refinery plants situated in the United States southern coast. Those who oppose the project say that it still poses enormous risks to the environment, but its proponents countered that, aside from creating new jobs and fostering new investments, it will help curtail U.S. reliance on imported oil.

Whether it’s a bane or a boon, Jack Gerard, American Petroleum Institute president, stressed that President Obama’s time (to decide on the project) has run out.  TransCanada needs a U.S. “go signal” because the pipelines will cut through the United States-Canada border.

He added that “The stars are aligning for America’s energy future and President Obama should make the right choice now and approve the entire Keystone XL pipeline”.

The administration’s indecision seems to drag the Keystone XL issue – along with other matters like high commodity prices and U.S. oil importations – into the U.S. presidential debates.

Officials of Nebraska had at first rejected the project due to potential risks to the aquifer, although TransCanada had also touched on other pipeline options at that time.

Nebraska’s Department of Environmental Quality Director, Mike Linder, disclosed to CNN that TransCanada has indeed indicated a suggested alternate route, but that this will have to be reviewed by the department within an estimated nine-month period.