Industry and congressional sources say they’re prepared for President Barack Obama to reject the Keystone XL oil pipeline soon, even as details on how and when the White House will rule on the controversial project remain unknown.
With concrete information from the administration scarce, the pipeline’s proponents instead view the lengthy review process, initiated by President George W. Bush and continued under Obama, as having now taken so long that an affirmative outcome appears unlikely.
The pipeline, which would transport oil from the tar sands of Canada to the Gulf of Mexico, is fiercely opposed by environmentalists who say it would only augment Americans’ reliance on fossil fuels.
Obama has taken several new steps to reduce dependence of those fuels in the past several months, including issuing a final rule curbing carbon emissions from power plants by 32% in fifteen years.
At the end of August, he is slated to make another push to bring attention to climate change, first addressing a green energy summit in Las Vegas and later traveling to the Alaskan Arctic underscore the effects climate change are having in the region.
His moves all come ahead of a December climate summit in Paris, where Obama hopes to laud carbon reduction commitments from other nations.
Those efforts, paired with Obama’s past statements downplaying the energy benefits of the pipeline, haven’t fostered much confidence among proponents that the project will be approved.
“A positive decision has not been rendered for a very long time,” said Canadian Prime Minister Stephen Harper in a late July interview with Bloomberg. “That’s obviously not a hopeful sign.”
Harper and other advocates for the Keystone pipeline have largely turned their focus to 2017, when Obama is no longer in office, as a chance to renew their efforts to start building. Republicans vying for their party’s nomination are supportive of the plan; Hillary Clinton, the Democratic frontrunner, refused to state a position on the Keystone pipeline when pressed late last month.
The U.S. government first began reviewing permit applications for the pipeline in 2008. Because it crosses the U.S.-Canada border, the State Department must first sign off.
The environmental portion of the review was largely positive, determining that overall carbon emissions wouldn’t be affected if the project was rejected since the Canadian tar sands would likely be tapped anyway. The Environmental Protection Agency disputed that finding.
The State Department says its review process is still underway. Obama must wait for an official recommendation from Secretary of State John Kerry before proceeding. Like Obama, Kerry has been a fierce advocate of programs to combat climate change.
In a Senate floor speech on July 28, Sen. John Hoeven of North Dakota said “sources” had indicated to him that Obama would reject the pipeline in August.
“Why then is he going to turn down the project now? It is because he will wait until Congress is out of session in August,” Hoeven said. “Then he will turn down the project while Congress is not in session to have less pushback, less criticism, of his decision if he makes it under the radar. That timing is understandable because he is making a political decision rather than a decision based on the merits.”
The White House, without saying Hoeven was right or wrong, reiterated the review of the pipeline is still underway.
“That particular process is a process that predates this administration, so I’m not going to have any update for you from here,” spokesman Eric Schultz said.
TransCanada, the Alberta-based firm petitioning the U.S. government to build the pipeline, said Tuesday that it’s “not convinced a decision is imminent.”
“Rumors of a decision have been percolating since last February and yet nothing has occurred,” said the company’s spokesman Mark Cooper. “We remain focused on securing a permit to build Keystone XL as we have been since 2008.”
The company has reportedly already spent $2.4 billion on the Keystone project, even before a final decision from the administration. To recoup those losses if the project is rejected, TransCanada could sue the U.S. government under a provision within the Clinton-era North American Free Trade Agreement.
Late last month, TransCanada’s chief executive didn’t rule out such a challenge, but said it wasn’t his current concern.
“TransCanada will employ whatever means necessary to protect its shareholders, and its shareholder value, but that’s not our focus at the current time,” Russ Girling said.