Stage set for battle over Canada-US pipeline

A lengthy battle over the controversial Keystone XL pipeline, which aims to funnel oil from Canada's tar sands to coastal Texas, heads to the most hotly contested area along the route Thursday. Hundreds of people are expected at a public hearing in Nebraska's environmentally sensitive Sand Hills as the US State Department prepares its recommendation on whether to approve the $5.3 billion project. While the final decision rests with US President Barack Obama, the State Department concluded in a draft report last month that the rerouted project -- which avoids the Sand Hills -- would have no major impact on the environment. Environmentalists and concerned landowners along the nearly 3,200-kilometer (2,000-mile) route vehemently disagree. "We do believe that we can stop the pipeline," Jane Kleeb, director of the advocacy group Bold Nebraska, told AFP. But the battle is already half lost. After nearly four years of fighting for approval of the entire project, TransCanada stripped the southern portion out of its presidential permit application and began building the renamed Gulf Coast pipeline last year. Once that begins operations later this year, TransCanada will be able to start shipping tar sand oil from Alberta to Texas using a pipeline that came online in 2010 to serve refineries in Oklahoma and Illinois. What's left for Obama to decide is whether TransCanada can increase its capacity from 590,000 to 1.4 million barrels per day by adding a second line -- Keystone XL -- along the northern route. It's not yet clear what Obama will do, especially now that he no longer has to walk a careful line between competing interests while seeking a second, and final, term in office. Obama has long favored an "all of the above" approach of expanding oil and gas production while investing in green energy, and he embraced the southern end of the pipeline in a campaign appearance in the oil depot town of Cushing, Oklahoma last year. Environmentalists are hoping he won't be swayed by the new route or the State Department's assessment and will instead look at the broader impact of increasing US imports of tar sand oil. "It's inconsistent with an administration that wants to fight climate change to unleash production of the dirtiest fuel on the planet," said Danielle Droitsch of the Natural Resources Defense Council Unlike traditional crude, which gushes out of a well, tar sand oil needs to be dug up and essentially melted with steaming hot water before it can be refined into useable petroleum products. The State Department estimated that the process produces 17 percent more greenhouse gasses than the average barrel of crude refined in the United States, but concluded that the pipeline would not result in increased emissions because Canada would simply sell the oil someplace else. Given the obstacles operators have encountered trying to build new pipelines in Canada, it's not clear that is the case, Droitsch said. Nor does the threat to groundwater disappear just because the new route avoids the Sand Hills, she said, because it still crosses over 1,000 bodies of water, including the massive Ogallala aquifer, which reaches eight US states. "We are not dealing with conventional oil here. This is stuff that actually sinks in water," Droitsch said, noting that the Kalamazoo river in Michigan has still not recovered from a 2010 spill of more than 800,000 gallons of tar sand oil after an Enbridge pipeline burst. --'The case for Keystone XL remains strong'-- Pipelines nevertheless remain a far safer way to transport oil than rail, truck or ship, TransCanada spokesman Shawn Howard told AFP. Keystone XL will be equipped with industry-leading safety technology that includes the ability to isolate a problematic section within minutes with remote-controlled valves and 21,000 sensors, which will report pipeline conditions every five seconds. "We continue to believe that Keystone XL will be approved," Howard said. The pipeline has undergone the most extensive review in US history and more than 12,000 pages of published analysis have "asked and answered" questions about the environmental risks and the need for the project, he said. "The case for Keystone XL remains strong," Howard said in an email. "In fact the longer it is delayed, the stronger the case for approving Keystone XL becomes, since the US refineries who need the product we will deliver to them will not have some of their current supplies (i.e., Mexico and Venezuela) in the next couple of years."