Canada says its time Obama decides on Keystone XL even if the answer is no

TORONTO – Canada’s foreign minister said Thursday it’s time for the Obama administration to make a decision on the controversial Keystone XL pipeline even if the answer is no.

“The time for a decision on Keystone is now, even if it’s not the right one,” John Baird said during a speech at the U.S. Chamber of Commerce in Washington. “We can’t continue in this state of limbo.”

Obama is expected to decide early this year on the pipeline, which is under review at the State Department. Some advocates fear another delay with the US mid-term elections approaching.

TransCanada’s pipeline would carry 700,000 barrels of oil a day from Alberta and the U.S. Bakken across six U.S. states to refineries in the Texas Gulf Coast. Republicans, the Canadian government and business and labour groups, have long urged the Obama administration to approve the pipeline as a source of much-needed jobs and a step toward North American energy independence. Environmental groups have been pressuring Obama to reject the pipeline, saying it would carry “dirty oil” that contributes to global warming. They also worry about a spill.

Baird warned if no new pipelines are built Canadian and Bakken-area oil would instead be shipped to the U.S. Gulf Coast by rail.

“Compared to sending by pipelines, sending by rail causes higher greenhouse-gas emissions and raises the per-mile incident rate,” Baird said.

Concerns have been raised about the increasing use of rail to transport oil throughout North America. Several recent derailments have worried both officials and residents close to rail lines. In July, 47 people were killed in Lac-Megantic, Quebec, when a train with 72 oil tankers derailed and exploded in the small community.

TransCanada chief executive Russ Girling said Wednesday if the Obama administration doesn’t approve the pipeline his company will look to the more dangerous alternative of building build rail terminals in Alberta and Oklahoma. Girling said pipelines are “by far a safer alternative” to oil trains, but said if customers want him to build rail terminals, he will.

Obama’s initial rejection of the pipeline went over badly in Canada, which relies on the U.S. for 97 per cent of its energy exports. The pipeline is critical to Canada, which needs infrastructure in place to export its growing oil sands production. The northern Alberta region has the world’s third largest oil reserves, with 170 billion barrels of proven reserves.

Obama initially refused to issue a permit for part of the Keystone XL project amid concerns about its potential impact on a large aquifer in Nebraska. The administration is considering another application.

Baird said the project has been studied and there have been huge public comment periods. He said dozens of improvements have been made.

“Agencies throughout this town have looked it over up and down, sideways,” Baird later told reporters in Washington. “We believe that decision time is upon us and we look forward in the coming weeks for the State Department to release its final decision and for the president to make a decision. This matters to Canada. We’re a close friend, we’re a close ally and we want to see this project go forward.”