State Dept. Delivers Unwelcome News For Keystone Opponents

A protest of the Keystone XL pipeline last March along its proposed route near Bradshaw, Nebraska. i i

A protest of the Keystone XL pipeline last March along its proposed route near Bradshaw, Nebraska. NH/AP hide caption

itoggle caption NH/AP
A protest of the Keystone XL pipeline last March along its proposed route near Bradshaw, Nebraska.

A protest of the Keystone XL pipeline last March along its proposed route near Bradshaw, Nebraska.

NH/AP

The U.S. Department of State says Canada's production of tar sands crude, which has a bigger greenhouse gas footprint than other types of oil, is unlikely to be affected by the controversial Keystone XL pipeline proposal.

That assessment came Friday as part of a massive environmental review by the State Department — the analysis fills 11 volumes.

"Approval of any single project is unlikely to significantly affect the rate of extraction of the oil from the oil sands or the refining of heavy crude on the U.S. Gulf Coast," says Kerri-Ann Jones, assistant secretary of state.

But this final version of the review also includes a caveat: Under certain economic conditions, the report says, the project could have a "substantial impact" on production of Canada's tar sands.

The agency's review culminates five years of environmental analysis of a broad array of potential environmental impacts, including an increase in greenhouse gas emissions and greater risks when this type of oil spills.

The final report focused on a nearly 1200-mile stretch of the pipeline from Hardisty, Alberta to Steele City, Neb. (A southern stretch of the Keystone pipeline from Cushing, Oklahoma to the Gulf Coast didn't face the same regulatory hurdles; construction was finished recently and oil started flowing through that section in January.)

The Keystone XL has been especially contentious because the kind of oil it would carry has a significantly bigger greenhouse gas footprint than conventional crude.

To produce heavy Canadian crude, companies scrape the tarry, sandy crude out of the earth with huge machines or inject steam underground to force it out. Then they process it and mix it with liquid fuel to get it to flow through a pipeline. Because of all the energy it takes to produce this oil, the new assessment says heavy Canadian crude has a greenhouse gas footprint 17% larger than the average crude refined in the United States.

The department's previous, more preliminary assessments of the project concluded that it would cause no substantial impact on the environment. In contrast, this final version acknowledged that there was significant uncertainty — and outlined various possible scenarios. Under each of these different scenarios, the additional greenhouse gas emissions projected from the project varied greatly.

The assessment leaves important questions unanswered, Jones says, including "the broader question about how this decision on this pipeline would fit with our broader national and international efforts to address climate change."

The assessment highlights many potential environmental effects of the pipeline, including the particular challenge that heavy Canadian Crude presents when it spills. The Kalamazoo River in Michigan is still being dredged 3 1/2 years after a pipeline burst and spilled heavy crude.

But the biggest issue is the impact of greenhouse gas — in July President Obama said the project won't be allowed to proceed "if it significantly exacerbates the problem of carbon pollution."

Some environmentalists criticize the agency for failing to acknowledge that Keystone XL would bolster production of tar sands by providing an outlet for 830,000 barrels a day.

But other environmentalists were encouraged by changes from previous analyses.

"The State Department is saying that the oil is both more toxic [and] more corrosive, as well as more carbon-intensive than conventional oil," says Michael Brune, executive director of the Sierra Club. "And so this is a document that actually gives Secretary Kerry complete latitude."

Energy analysts say the assessment also keeps the door open for Kerry to approve the pipeline.

TransCanada, the Canadian company proposing to build the project, welcomed the review's findings.

"We're very pleased with the release and [with] being able to move to this next stage of the process," says Russ Girling, president and CEO of TransCanada. "It's been long in getting here."

Jones say Secretary Kerry will weigh other factors, such as energy needs and national security, as he works to determine if the pipeline is in the national interest of the United States overall. For example, pipeline supporters stress that Keystone XL would reduce dependence on oil from Venezuela and the Middle East.

There's no deadline for Kerry's decision.

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