Obama adminstration rejects Keystone XL pipeline, TransCanada can reapply

The US State Department has rejected the application from TransCanada to build the Keystone XL from the Alberta bitumen sands to Texas. But the door is open for TransCanada to reapply for a permit, using a new route.

Soon after the announcement from Washingon, Prime Minister Stephen Harper issued a statement saying that President Barack Obama called Harper to let him know abut the decision. Harper’s release expresses his “profound disappointment” with the decision.

Related TransCanada says it will reapply to build Keystone XL pipeline

In a news conference, Natural Resources Minister Joe Oliver told reporters that the decision was disappointing and “in the best interests of both countries.” Oliver said the process is not over and he hoped that the Keystone project will “eventually approved on its merits.”

He said: “The responsible development of the oil sands…is expected to create thousands of jobs and bring significant economic benefits.”

He added that the Obama decision underlined the importance of diversifying the energy market, especially to Asia.

The State Department says.

Today, the Department of State recommended to President Obama that the presidential permit for the proposed Keystone XL Pipeline be denied and, that at this time, the TransCanada Keystone XL Pipeline be determined not to serve the national interest. The President concurred with the Department’s recommendation, which was predicated on the fact that the Department does not have sufficient time to obtain the information necessary to assess whether the project, in its current state, is in the national interest…

On December 23, 2011, the Congress passed the Temporary Payroll Tax Cut Continuation Act of 2011 (“the Act”). The Act provides 60 days for the President to determine whether the Keystone XL pipeline is in the national interest – which is insufficient for such a determination.

The Department’s denial of the permit application does not preclude any subsequent permit application or applications for similar projects.


The White House issued a statement saying:

Earlier today, I received the Secretary of State’s recommendation on the pending application for the construction of the Keystone XL Pipeline. As the State Department made clear last month, the rushed and arbitrary deadline insisted on by Congressional Republicans prevented a full assessment of the pipeline’s impact, especially the health and safety of the American people, as well as our environment. As a result, the Secretary of State has recommended that the application be denied. And after reviewing the State Department’s report, I agree.

This announcement is not a judgment on the merits of the pipeline, but the arbitrary nature of a deadline that prevented the State Department from gathering the information necessary to approve the project and protect the American people. I’m disappointed that Republicans in Congress forced this decision, but it does not change my Administration’s commitment to American-made energy that creates jobs and reduces our dependence on oil. Under my Administration, domestic oil and natural gas production is up, while imports of foreign oil are down. In the months ahead, we will continue to look for new ways to partner with the oil and gas industry to increase our energy security –including the potential development of an oil pipeline from Cushing, Oklahoma to the Gulf of Mexico – even as we set higher efficiency standards for cars and trucks and invest in alternatives like biofuels and natural gas. And we will do so in a way that benefits American workers and businesses without risking the health and safety of the American people and the environment.