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Environmental agency letter adds to uncertainty over Keystone

The U.S. Environmental Protection Agency has raised serious concerns about the impact of the controversial Keystone XL pipeline, undercutting the State Department's key contention that the project would not dramatically increase greenhouse gas emissions from the oil sands.

The EPA said in a comment letter that the State Department's draft environmental impact statement contained inadequate information on the effects of the proposed pipeline, and suggested more study, a recommendation that could further delay the long-stalled project.

Canadian politicians from Ottawa and Edmonton have been frequent visitors to the United States to lobby for approval of the pipeline, which would carry more than 800,000 barrels of oil sands bitumen to the massive refining hub on the U.S. Gulf Coast. Natural Resources Minister Joe Oliver was in New York on Monday to extol the virtues of the pipeline, while Alberta Premier Alison Redford has visited Washington several times this year.

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U.S. President Barack Obama must make the ultimate decision on the cross-border pipeline, and the EPA letter filed Monday adds another note of uncertainty to a process that proponent TransCanada Corp. hopes will conclude this summer.

In its analysis, the State Department concluded the Keystone XL pipeline would have a minor impact on greenhouse gas emissions from the oil sands because producers will find a way to get the crude to market with or without the project.

"Because the market analysis is so central to this key conclusion, we think it is important that it be as complete and accurate as possible," said the letter, signed by EPA assistant administrator Cynthia Gales. She questions whether other pipelines will get built, and said reliance on rail would mean higher transportation costs and potential congestion that could affect "the level of pace of oil sands production."

The environmental agency also wants the State Department to revisit issues of pipeline safety, noting the cleanup difficulties from Enbridge Inc.'s spill in Michigan in 2010, and to provide further information on alternative pipeline routes that would avoid the Ogallala aquifer, a key source of drinking water for the U.S. plains states.

Environmentalists applauded the EPA's stand, even as Canadian politicians trumpeted new efforts to demonstrate that Ottawa and Alberta are committed to monitoring and reducing the oil sands' impact.

Federal Environment Minister Peter Kent and his Alberta counterpart, Diana McQueen, unveiled the website of a joint monitoring group on Monday, with Mr. Kent insisting the public access will help U.S. supporters of the Keystone XL pipeline reassure Americans that Canada is serious about environmental protection.

"It proves our commitment to accountability and to transparency," the minister said.

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The program is in the first year of a three-year ramp-up.

"Over all, levels of contaminants in water and in air [downstream of the oil sands] are not cause for concern," the joint monitoring group says, although it acknowledges its findings are based on "very early results."

University of Alberta biologist David Schindler said the enhanced monitoring and public website may be positive steps, but only if properly managed.

"If they use it wrong, it could be just another propaganda portal for the oil sands," said Dr. Schindler, who has published work showing industrial contamination downstream from oil-sands operations.

After years of allowing an industry-backed body to do the work, the two governments established a federal-provincial body, and are now expanding their data collection in four areas: effects on air, water, wildlife contaminants and biodiversity. By 2015, more than 100 scientists will be collecting data in a $50-million-a-year effort funded by industry.

The joint monitoring report acknowledged that some contamination is in the air and water, but said it only rarely exceeds environmental guidelines. But Dr. Schindler noted the governments have approved a doubling of oil sands production, and should be preventing cumulative environmental effects rather than simply reacting once the contaminants have reached alarming levels.

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At the Ottawa press conference, Ms. McQueen said the provincial government will force industry to cut emissions if the monitoring shows an unsustainable buildup.


Here's what $50-million will buy for oil sands monitoring when fully implemented:

Some 100 federal and provincial scientists will work on the project;

Monitoring sites as far east as Churchill, Man., and deep into the Northwest Territories;

The number of water sampling sites will climb from 21 to 40;

The number of air sampling sites will rise from 21 to 30;

There will be 75 wildlife contaminant sampling sites;

Scientists will monitor biodiversity from more than 70 locations, with thousands of samples taken each year to assess effects on individual species;

A Web portal that officials promise will include much raw data to allow non-government scientists free access to the information;

An interactive map that allows the public to view data from each sampling spot.

- Staff

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