At the same time, the Consumer Energy Alliance, a group funded partly by oil and gas firms, issued an economic analysis that said the 1,700-mile pipeline connecting Alberta’s oil sands to Texas refineries would generate $580.2 million in direct spending over two years in Nebraska.
And 10 Republican governors and Saskatchewan’s premier sent a letter to Obama that urged him to approve the pipeline, which would ship 700,000 barrels of crude daily from Canada to the United States.
The State Department’s draft Environmental Impact Statement, which could come in the next few weeks, will be open to public comment before it is finalized.
Obama initially rejected the project a year ago on the grounds that his administration needed more time to review its effect on the ecologically sensitive Sand Hills region in Nebraska. The pipeline’s builder, TransCanada, revised the route and moved it farther east of Nebraska’s Ogalalla Aquifer, a key water supply. Gov. Dave Heineman (R) is expected to endorse the project.
But environmentalists still question the climate impact of extracting bitumen, a viscous oil that comes from formations of sand, clay and water. The process produces more carbon emissions as well as petroleum coke, or petcoke, a byproduct that can be burned like coal and is sometimes sold at low prices to power plants or industries such as aluminum and steel.
The Oil Change International report said that burning petcoke emits 5 percent to 10 percent more carbon dioxide per unit of energy than coal, so petroleum coke use would raise estimates of greenhouse gas emissions from oil sands development 13 percent above earlier State Department estimates.
The State Department analyzed this issue in its initial environmental review and concluded that burning petcoke could increase emissions by up to 14 percent, but added that, since in many instances this combustion would be replacing coal, the emissions difference would be “much smaller.”
TransCanada said that “there is nothing new” in Oil Change International’s report. The company said crude derived from oil sands was no worse than heavy oils from California, Mexico or Venezuela, and moving that oil by pipeline would be more energy- efficient than transporting it by rail or truck.
Weighing the project’s carbon impact poses a challenge for Sen. John F. Kerry (D-Mass.), Obama’s nominee to become secretary of state. Kerry has devoted his career to fighting global warming. Regarding Keystone XL, he told the Hill newspaper in October that “there’s a lot at stake here, and I’ll do my best to leave no question unanswered, including every possible economic and environmental consideration, before a final decision is made.”