State Department to approve Keystone pipeline permit
The Trump administration will approve the Keystone XL oil pipeline by Monday, reversing one of former President Barack Obama’s most politically charged environmental decisions, according to two sources with knowledge of the plan.
The move by the State Department comes 16 months after Obama blocked construction of the 1,200-mile pipeline, which would ship crude from Canada’s western oil-sands region to refineries on the Gulf Coast. The pipeline became the subject of major lobbying efforts by both oil industry supporters and environmental groups, which turned the project into the focus of their climate change campaigns.
Undersecretary for political affairs Tom Shannon plans to sign the pipeline’s cross-border permit on or before Monday, the last day for the 60-day timeline that President Donald Trump ordered in January. Secretary of State and former Exxon Mobil Chief Executive Rex Tillerson recused himself from the process.
The approval, while long expected, will hand Trump a political victory and follows his promise to quickly approve the $8 billion project that developer TransCanada has sought to build for nearly a decade.
Keystone XL has become as much a political totem as an infrastructure project. Republicans and oil industry backers have touted its economic benefits and the thousands of construction jobs it would create, while environmentalists warned the oil artery could pose huge spill risks and would stoke development in Alberta’s oil sands region, unleashing a vast amount of the carbon dioxide that scientists say is causing climate change.
The White House would not confirm the report, and spokesman Sean Spicer told reporters at the daily briefing that he would have update on Keystone on Friday.
While the permit will eliminate a crucial barrier for the pipeline, other hurdles still remain, including winning approval for the project in Nebraska and winning over landowners there who have denied it the right of way.
The president and his administration also continue to struggle on another of his pipeline-related promises: Where the steel for the pipeline will come from. Trump as recently as this week continued to say that he would require TransCanada to use American-made steel to build the U.S.-side of the pipeline, despite the White House’s admission earlier this month that it would not hold Keystone XL to that standard.
“If people want to build pipelines in the United States, they should use American steel and they should build it and create it right here,” Trump said at a Monday rally in Louisville, Ky. “That pipeline is going to be manufactured right here.”
TransCanada has said roughly half of the steel for Keystone XL will come from the U.S. That steel will come from Welspun Tubular in Arkansas, a subsidiary of India-based Welspun Group.
Even as it clears one major federal hurdle, TransCanada’s regulatory marathon now heads to the state level.
The company still needs the approval from the Nebraska Public Service Commission to approve the pipeline’s route through the state. The decision is expected in late September.
Bold Alliance, a group that has protested the pipeline, is now seeking local residents to file as “intervenors” in the NPSC process in an effort to block route approval, said Jane Kleeb, the group’s president and Nebraska Democrat Party chair.
In addition, the pipeline is likely to encounter delays from landowners in the state unhappy with the company’s use of eminent domain along the route, Kleeb said. TransCanada says 90 percent of landowners along the proposed route have signed voluntary easement approvals, but there are still holdouts.
“We turn to our state, Nebraska, which has been the heart of the KXL resistance for the past seven years,” Kleeb said.