KEYSTONE XL PIPELINE

Keystone XL Pipeline Project

Keystone XL Pipeline Project

Introduction

The controversial Keystone XL pipeline from the Alberta oil sands into the Southern U.S. appears to have been delayed. The U.S. government skirted questions about the fate of the TransCanada Corp. pipeline, but the Canadian government appeared to confirm the development. "We are disappointed with today's decision to delay a decision on the Keystone XL pipeline," Andrew MacDougall. "As we have consistently said, the pipeline will create thousands of jobs and billions in economic growth on both sides of the border. While disappointed with the delay, we remain hopeful the project will be decided on its merits and eventually approved."

U.S. media reports said the Obama administration was delaying the project so it can consider an alternative route that would move the pipeline away from the Ogallala Aquifer and the ecologically fragile Sand Hills in Nebraska. That would potentially delay the project past the 2012 U.S. presidential election. State Department officials had said that all options regarding Keystone XL were on the table - including the potential for rerouting the pipeline and outright denial of a permit allowing Calgary-based TransCanada to build the pipeline. The pipeline would run 2,700 kilometers from Hardisty, Alta., to refineries on the Gulf Coast of Texas, carrying as much as 830,000 barrels worth of crude oil per day. "Canada will be looking for a buyer," spokeswoman Sara McIntyre said. "We're a resource-based, energy-based country and we'll be looking at all opportunities." The apparent move by the Obama administration will likely cast a chill over U.S. relations with the Harper government. Contrastingly, Obama, in an interview last week with a Nebraska TV station expressed concern about the threat to the environment.

Discussion

Next to a sun-stained red flag that marks the planned route of the Keystone XL pipeline, Leon Weichman kneels on his Nebraska hay field. It has barely rained in 30 days in this arid part of the central U.S., yet the grasses are thick and green. The soil is black and damp. This field is normally irrigated by the subterranean reaches of a vast underground formation called the Ogallala Aquifer that underlies the heart of America. It is half the size of British Columbia and filled with freshwater. Mr. Weichman says he has slept uneasily for three years, knowing that the red flag portends a time when up to 830,000 barrels of oil could course through his field each day (Bureau of National Affairs 2011).

Now the Ogallala has inspired a fierce battle over oil, turning Keystone XL into a symbolic dividing line for opponents and supporters of Canada's oil sands. The red flags marking the route have come to delineate an increasingly bitter fight between those who tout the economic and strategic benefits of a giant resource of North American crude and those who see the oil sands as an unacceptable environmental threat. To critics, Keystone XL is not just a risk to Nebraska's water treasure. It represents the rapid growth in Alberta's oil sands and the harmful greenhouse gas ...