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Construction on an earlier phase of the Keystone pipeline
Construction on an earlier phase of the Keystone pipeline

U.S. set to approve Keystone XL pipeline Add to ...

U.S. Secretary of State Hillary Clinton has sent the first signals to Alberta's oil sands producers that the Obama administration is set to green-light a pipeline delivering more of its crude, saying that Canada's "dirty oil" is a better alternative for the United States than the Persian Gulf's.

In remarks that went largely unnoticed until Wednesday, the U.S. secretary of state told the Commonwealth Club of San Francisco late last week that TransCanada Corp.'s Keystone XL pipeline will likely be approved by the U.S. State Department.

The proposal for the pipeline is currently being reviewed by the State Department following cajoling by Democratic legislators, environmentalists and the Environmental Protection Agency in the aftermath of the Gulf of Mexico oil disaster earlier this year.

"We haven't finished all of the analysis, so as I say, we've not yet signed off on it," Ms. Clinton said in response to a question from the audience at the event on Friday.

"But we are inclined to do so and we are for several reasons ... we're either going to be dependent on dirty oil from the Gulf or dirty oil from Canada."

Tolerating dirty oil, she added, is a reality "until we can get our act together as a country and figure out that clean, renewable energy is in both our economic interests and the interests of our planet."

"It's a very hard balancing act," she said. "Energy security requires that I look at all of the factors that we have to consider while we try to expedite as much as we can America's move toward clean, renewable energy."

The Keystone XL project would transport as many as 900,000 barrels of oil a day from Alberta, cutting a swath through the U.S. heartland to refineries on the Gulf coast. The pipeline would double the amount of current oil sands exports.

Canada is already the largest single exporter of oil to the U.S., and Alberta's oil sands are the biggest single source of oil for the U.S. But environmentalists on both sides of the border have been railing for months against both the pipeline and the oil sands, which have a larger carbon footprint than conventional oil sources.

The State Department didn't immediately respond to a request for more information on Wednesday. It has jurisdiction over the pipeline because it crosses an international border, and is expected to make a decision on it early next year.

The department extended its review of the pipeline past its mid-September deadline at the insistence of the EPA and Henry Waxman, a powerful California congressman who's been the most bitter foe of the oil sands on Capitol Hill.

Mr. Waxman, the chairman of the House of Representatives' energy and commerce committee, said Ms. Clinton's department was failing to consider the impact that additional oil consumption in the United States would have on climate change.

Others have raised concerns that the Keystone pipeline could pollute air, water and pose risks to migratory birds and other wildlife.

Politicians in Nebraska, including Republicans who once supported the project, have been urging Ms. Clinton in recent days to consider alternate routes for the pipeline. In letters to Ms. Clinton, they've told her the current route could pose oil-leak dangers to an integral aquifer that provides nearly 80 per cent of the state's drinking water.

Nebraska Gov. Dave Heineman urged Ms. Clinton to ensure that "Nebraska's natural resources are protected" as she considers the proposal.

"Almost 300 miles [480 kilometres]of the proposed pipeline will come through Nebraska and be situated directly over the Ogallala Aquifer," the Republican wrote, adding that the resource "is a lifeblood of Nebraska's agriculture industry."

TransCanada has said its pipeline would pose no threats to the environment, but its assurances haven't been helped by a massive leak from another Canadian pipeline earlier this year. A rupture in a pipeline operated by Enbridge Inc., TransCanada's rival, resulted in nearly four million litres of oil leaking into a rural Michigan river this summer.

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