Long Slog on Keystone Continues

A final decision on the controversial pipeline is still months away, even with another hurdle cleared on Friday.

MILLBRAE, CA - JUNE 11: Protestors hold sections of mock pipeline during a demonstration outside of the site of the Facebook shareholders meeting at the Westin Hotel on June 11, 2013 in Millbrae, California. Dozens of protestors staged a demonstration outside of Facebook's first shareholders meeting in opposition of Facebook's use of ads in support of the Keystone pipeline and their blocking of images of mothers breast feeding. (Photo by Justin Sullivan/Getty Images)
National Journal
Amy Harder
Feb. 1, 2014, 5:51 a.m.

A fi­nal res­ol­u­tion on the Key­stone XL pipeline is still months away, and it’s pos­sible Pres­id­ent Obama could wait un­til after the midterm elec­tions in Novem­ber to make his de­cision.

The State De­part­ment said in a re­port Fri­day that the pro­posed pro­ject, which would send oil from Canada’s tar sands to Gulf Coast re­finer­ies, is not likely to lead to a surge in green­house-gas emis­sions. This find­ing paves a path to yes for Obama, who said last sum­mer he would only ap­prove the pipeline if it didn’t “sig­ni­fic­antly ex­acer­bate” glob­al warm­ing.

But the re­port doesn’t mean he will ap­prove a per­mit for the pro­ject, at least not yet, and it doesn’t mean he won’t say no. At the very least, we can ex­pect to wait a few more months.

“They con­trol the clock, and they con­trol the op­tions,” said Kev­in Book, man­aging dir­ect­or of en­ergy con­sult­ing firm Clear­View En­ergy Part­ners.

Sup­port­ers of the pipeline in Con­gress are not happy about the pro­spect of a long delay for polit­ic­al reas­ons. “To sug­gest that this can wait un­til after a midterm elec­tion is noth­ing more than kick­ing the can down the road and not do­ing the job that we were elec­ted to do,” said Sen. Heidi Heitkamp, D-N.D. “I sup­pose we could quit everything we’re sup­posed to be do­ing be­cause of an elec­tion. There is al­ways go­ing to be an ex­cuse to delay this.”

Here’s how the pro­cess plays out now. De­part­ing from past pre­ced­ent, the State De­part­ment is al­low­ing a 30-day pub­lic com­ment peri­od, which starts Wed­nes­day. Ac­cord­ing to mul­tiple sources, this time peri­od runs along­side a par­al­lel step where the State De­part­ment, in con­sulta­tion with at least eight dif­fer­ent fed­er­al agen­cies, de­term­ines wheth­er the pipeline is in the coun­try’s na­tion­al in­terest.

The State De­part­ment will con­sider sev­er­al factors, in­clud­ing en­ergy se­cur­ity and en­vir­on­ment­al and eco­nom­ic im­pacts. The pro­cess can­not take longer than 90 days, ac­cord­ing to the ex­ec­ut­ive or­der es­tab­lish­ing this au­thor­ity, but it’s un­clear when the clock starts. Mul­tiple sources close to the pro­cess said it be­gins when the re­port is pub­lished in the Fed­er­al Re­gister.

After the 90-day clock winds down, Sec­ret­ary of State John Kerry is poised to make a fi­nal de­cision, which in­cludes a 15-day re­view peri­od for oth­er fed­er­al agen­cies. If any agency re­quests it, the fi­nal de­cision could be moved from the State De­part­ment to the White House, where Obama would make the call. Con­ven­tion­al wis­dom sug­gests that a fi­nal an­swer on this pipeline — which en­vir­on­ment­al­ists have turned in­to a lit­mus test on Obama’s com­mit­ment to glob­al warm­ing — will come from the White House re­gard­less.

The State De­part­ment’s in­spect­or gen­er­al is also ex­pec­ted to re­lease a re­port de­term­in­ing wheth­er the con­tract­or for the en­vir­on­ment­al re­view — ERM Group — has a con­flict of in­terest with Tran­sCanada, the com­pany seek­ing to build the pipeline. A spokes­man said it will be re­leased early this year, and that could also fur­ther delay the pro­ject, de­pend­ing on the find­ings.

All told, the re­main­ing part of the reg­u­lat­ory pro­cess should take about four months, which would put a fi­nal de­cision around June. But the law doesn’t set a dead­line for a de­cision after the 90-day clock runs out, so in the­ory the ad­min­is­tra­tion could delay its an­swer for any num­ber of reas­ons for any amount of time.

“How long does it take to ana­lyze pub­lic com­ments on the na­tion­al in­terest de­term­in­a­tion? Is that an­oth­er year?” Book asked.

Book was driv­ing home the point that the time frame for a fi­nal an­swer on Key­stone, which has been in the reg­u­lat­ory pipeline at the State De­part­ment since Septem­ber 2008, is still un­cer­tain des­pite Fri­day’s re­port in­dic­at­ing Obama has a basis to green-light it.

“I’m go­ing to do everything I can to en­cour­age a short­er time peri­od,” Heitkamp said. “That’s im­port­ant be­cause if we don’t get an op­por­tun­ity to con­struct in the sum­mer and fall we lose a lot of time.”

Heitkamp is one of a hand­ful of Demo­crats who sup­port le­gis­la­tion ap­prov­ing the pipeline ir­re­spect­ive of Obama’s au­thor­ity. She said Fri­day she wanted to talk to her col­leagues be­fore de­cid­ing wheth­er or when to try to get a vote on that bill. She said she would also en­cour­age the ad­min­is­tra­tion to shorten the 90-day peri­od to 30 days.

Crit­ics of the pro­ject are un­happy with Fri­day’s re­port and are already de­mand­ing more ana­lys­is, in­dic­at­ing a po­ten­tial for fur­ther delay.

“I will not be sat­is­fied with any ana­lys­is that does not ac­cur­ately doc­u­ment what is really hap­pen­ing on the ground when it comes to the ex­trac­tion, trans­port, re­fin­ing, and waste dis­pos­al of dirty, filthy tar sands oil,” said Sen­ate En­vir­on­ment and Pub­lic Works Com­mit­tee Chair­wo­man Bar­bara Box­er, D-Cal­if.

If the State De­part­ment does opt for more ana­lys­is, or al­lows more time for pub­lic com­ments, the timeline could eas­ily get pushed from sum­mer to au­tumn, put­ting it right up against the midterm elec­tions, where Demo­crats’ con­trol of the Sen­ate is at risk.

Tran­sCanada CEO Russ Girl­ing said he hopes the re­main­ing part of the pro­cess could be shortened.

“Wheth­er this gets pushed fur­ther in­to fall and elec­tion sea­son, I would hope not,” he said. “There is no reas­on for that.”

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