Policy: Environment & Energy

Decision on Keystone pipeline likely delayed until 2014

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The State Department’s decision on the proposed Keystone XL transcontinental oil pipeline is in danger of being bumped to next year, as the agency’s internal watchdog says it needs more time to finish an ongoing investigation of the project.

The State Department Office of Inspector General said its months-long probe of whether the contractor the department hired to conduct an environmental impact study had a conflict of interested likely won’t be ready until January.

The study, by Environmental Resources Management, suggested the pipeline would have little effect on the environment or global warming. But Mother Jones magazine earlier this year reported that analysts who helped draft the report had worked for TransCanada — the Canadian company proposing the project — and other energy companies poised to benefit from the pipeline.

The State Department, which must approve the pipeline because it would cross an international border, says there is no timetable for its decision. But because of the highly controversial nature of the project, the agency is expected to hold off on a decision until after the watchdog report is released.

A State Department official, speaking on background, said Monday the agency won't release its final environment impact study on Keystone until "after additional analysis and the issues identified in the public comments have been incorporated." 

The project has divided Democrats, with environmentalists fighting the proposed pipeline that would carry Canadian crude oil from Alberta’s tar sands to refineries on the Gulf Coast, while labor groups and some Democratic lawmakers from oil states want the jobs the $5.3 billion project would create.

The president says he will evaluate the 1,179-mile proposed pipeline based on whether it would significantly add carbon to the atmosphere, which scientists say contributes to global warming.

A September court case involving a lawsuit by three Nebraska landowners who would be affected if the pipeline is built could delay the project further. A win for the landowners, who oppose the pipeline, likely would force TransCanada to resubmit its plans with the U.S. government — which could set the project back years.

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