Keystone pipeline clears hurdle

The State Department on Friday said it had no major environmental objects to the proposed $7 billion (5.3 billion euro) pipeline. The decision paves the way for President Barack Obama's administration to approve its construction, an issue that has deepened divides between environmental groups and the oil industry.

The 11-volume report did not recommend approval or denial of TransCanada Corp's application to build the pipeline, which would transport oil more than 1,100 miles (1,900 kilometers) through the Midwest from Canada to Texas.

Supporters of the project say it will bring jobs to the US and help the country increase its energy independence. Opponents say the pipeline would carry "dirty oil" that contributes to global warming to the US, while also voicing concern about potential spills.

The White House said the report was not the final step of approval for the pipeline and that a decision would only be made after various US agencies and the public had the chance to review the report and other data.

"The president has clearly stated that the project will be in the national interest only if it does not significantly exacerbate the problem of carbon pollution," said White House spokesman Matt Lehrich.

There is no firm deadline for approving the pipeline, and it awaits another three-month review session, meaning the issue is likely to last into the 2014 midterm election season.

'Out of excuses'

Republicans, along with some oil- and gas-producing states, hailed the report, saying it was time Obama took action after a drawn out approval process that has taken more than five years.

"President Obama is out of excuses," said Republican Speaker of the House of Representatives John Boehner. "If President Obama wants to make this a 'year of action' he will stand up to the extreme Left in his own party, stand with the overwhelming majority of the American people, and approve this critical project."

Canadian Natural Resources Minister Joe Oliver said he was "encouraged" by the report.

"The benefits to the United States and Canada are clear. We await a timely decision on this project," he said.

The Keystone XL project would transport some 830,000 barrels of heavy crude a day from oil sands in Alberta to Nebraska refineries, before connecting with an existing pipeline and shipping to Texas.

It has been delayed in part because of concern it would damage sensitive wetlands and endangered species in South Dakota and Nebraska. Additionally, the report says oil derived from Alberta's tar sands produces 17 percent more greenhouse gas emissions than traditional coal.

dr/jm (AP, AFP, Reuters)