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Will Obama Administration Clear Keystone XL Pipeline?

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The future of the controversial Keystone XL oil pipeline is in the hands of the State Department. President Obama rejected a similar pipeline proposal last year, but now that Nebraska Gov. Dave Heineman has approved an alternative route through his state, the approval process is back on track.

Because the Keystone XL would cross an international boundary — between Saskatchewan and Montana — it requires review by the State Department and a special presidential permit.

Environmental groups oppose the pipeline because the oil comes from Canada's tar sands, which requires a process that emits more pollution than traditional methods.

At a Capitol Hill hearing on Thursday, Secretary of State nominee Sen. John Kerry was asked how he'll weigh the environmental consequences of the pipeline. He didn't answer the question but said the State Department is working on the application. "It will not be long before that comes across my desk and at that time I'll make the appropriate judgments about it," he said.

The Keystone XL ultimately would move crude from Alberta south to the Gulf Coast. The original route through Nebraska's Sand Hills region was controversial. The company behind the project, TransCanada, proposed the alternative route. Heineman approved it, but not everyone in Nebraska shares his view.

Climate Change Connection?

Jane Kleeb directs the group Bold Nebraska, which opposes the Keystone XL. She hopes President Obama, who has final say over the pipeline, will reject it.

"I was so excited to hear him talk about climate change," says Kleeb, referring to Obama's inaugural address on Monday.

In that speech, Obama said the country should lead the world's transition to sustainable sources of energy.

"We will respond to the threat of climate change, knowing that the failure to do so would betray our children and future generations," Obama said as the crowd applauded.

The president made no mention of the Keystone XL. Still, Kleeb took that statement as evidence he may reject the pipeline. "President Obama can't say those deep words about climate change and then turn around, with a straight face, and approve this pipeline," Kleeb says.

Promoting the Pros

At TransCanada's headquarters in Calgary, executives did not anticipate the years of sustained opposition the proposed pipeline has created. So it is understandable that now they are hesitant to predict that the process will go smoothly from here.

"We don't entirely know what to expect," says TransCanada spokesman Shawn Howard. "We know that there's still a lot of work to do."

Howard says the best his company can do is present its case to the State Department and the U.S. public.

"If you're going to rely on oil for decades to come as a key part of your economy, would you rather get it from the Middle East, where you've got to move it by tanker, which isn't as safe as a pipeline?" asks Howard.

And he repeats a point TransCanada frequently makes — that it's preferable to get oil from a friendly neighbor than from countries far away that may not share U.S. interests. Along with environmental concerns, that issue is likely to weigh heavily on both the future secretary of state and Obama in coming months.

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