By Ben DuBose
(UPDATED at 2:30 p.m. with formal rejection,
statements from Obama, Pelosi)
The Obama administration on Wednesday formally denied a
permit to TransCanada for its proposed Keystone XL oil pipeline expansion.
US Deputy Secretary of State William J. Burns delivered the
announcement early Wednesday afternoon.
The controversial proposal would have resulted in a 1,700-mile
oil pipeline stretching from Canada to Texas, carrying nearly 1
million barrels of oil per day.
However, TransCanada and other companies will be allowed to
reapply with an alternate route going through Nebraska.
"As the State Department made clear last month, the rushed and
arbitrary deadline insisted on by Congressional Republicans
prevented a full assessment of the pipelines impact,
especially the health and safety of the American people, as
well as our environment," Obama said in a statement.
US environmentalists have said they want to avoid the Sand
Hills in Nebraska, an important aquifer in the region.
TransCanada initially applied for
a permit in 2008. The State Department reviewed the project to determine whether it
serves the national interest and pledged to make a decision on
the project by the end of 2011.
But the president announced in November 2011 that his
administration needed more time to consider alternative routes
and would delay a decision until after the 2012
The project has been opposed by environmental groups and
citizen activists. The battle to defeat the pipeline culminated
in a protest at the White House that attracted thousands of
Republicans accuse the US president of succumbing to
pressure from this wing of his supporters, and of playing
politics with a project that they say will create
Some Democrats, however, say Republicans have been
exaggerating the number of jobs that will be created as a
result of the pipeline project.
They accuse GOP members of being a mouthpiece for
TransCanada and the influential lobby groups that represent the
"Keystone oil wasn't for domestic consumption," said House
Minority Leader Nancy Pelosi, a California Democrat. "It would
go from Canada through the US and then overseas."
A 60-day clock for Obamas decision
started late last year, after Republicans fought and won a
heated battle to include a deadline in a separate bill that
extended payroll tax cuts. The deadline was Feb. 21.
"This announcement is not a judgment on the merits of the
pipeline, but the arbitrary nature of a deadline that prevented
the State Department from gathering theinformation necessary to
approve the project and protect the American
people," Obama said.
The full text of Obama's statement can be read by clicking here.
A majority of Hydrocarbon Processing readers
said they expected the pipeline to be approved, citing the need for jobs
and additional US oil supply.
Industry groups including the American Petroleum Institute
(API) sent letters to Obama urging its approval.
-- Additional reporting from Dow Jones