Keystone XL Pipeline Report Creates Political Headache For Obama

By Liz Halloran

Published February 3, 2014 at 4:12 PM EST

The proposed Keystone XL pipeline will run through this field near Bradshaw, Neb.

Any expectation that a new State Department report would clarify the Keystone XL pipeline issue went up in smoke in recent days.

In the aftermath of a conclusion that downplayed the oil pipeline's potential effects on climate change, the issue has gotten even more politically complicated for the Obama White House. Environmentalists are ramping up their opposition to the proposed 1,179-mile pipeline, while Republicans have intensified their push for approval. As for Democrats, well, that depends on their election prospects.

A Pew Research Center poll last September found that 65 percent of Americans expressed support for the pipeline, including 51 percent of Democrats surveyed.

As all sides re-up in a battle that began five years ago when the White House was asked to approve the oil pipeline from western Canada's tar sands to a Nebraska transfer station, here's a look at where things stand:

The Obama White House

The long-awaited State Department report found that the pipeline, the fourth and last Keystone section, would not have a "significant" effect on greenhouse gas emissions. Its assessment goes something like this: If Keystone XL doesn't get built, the oil extracted from Canada's tar sands will still be transported somehow — likely by rail — and have the same environmental effect. That leaves President Obama with an unenviable case to make to his liberal base if he chooses to support the pipeline, and an equally difficult decision to defend — particularly with the labor unions that support it — if he opposes a project Republicans have made key to their jobs-and-energy argument. White House chief of staff Denis McDonough says Obama is not in a rush to make a decision. "We have one department with a study," he said on NBC's Meet the Press. "Now we have other expert agencies, the EPA, and many others, who have an opportunity ... to look at this and make their determinations."

Secretary of State John Kerry will make a final recommendation to Obama, who has 90 days to decide. The question is how long the president will wait — and what effect it will have on November's midterm elections, when the fate of Democratic senators from conservative-leaning, energy-producing states will determine whether the party retains control of the Senate.

Environmentalists

Alarmed at the no harm, no foul nature of the State Department's assessment, environmental groups have been organizing scores of vigils for Monday night to underscore their opposition. They're characterizing this as an "all hands on deck moment" and have promised civil disobedience if the White House signs off on TransCanada's $5.4 billion-plus pipeline. In a letter to Kerry, billionaire Democratic Party supporter Tom Steyer questioned the integrity of the State Department analysis, calling it "defective" because a TransCanada contractor was involved in the report preparation.

Steyer is the founder of the anti-pipeline NextGen Climate Action Group that ran anti-pipeline ads during Obama's State of the Union address last week. The group 350.org, founded by environmental activist Bill McKibben, has also characterized the State Department report as "deeply flawed and compromised by its affiliation with TransCanada contractors."

Democrats

At least eight Democratic senators have previously expressed support for Keystone XL, and tough 2014 re-election races faced by four of them — Mark Begich of Alaska, Mary Landrieu of Louisiana, Mark Pryor of Arkansas and Kay Hagan of North Carolina — will determine control of the Senate.

The State Department report, Begich has said, "confirms what Alaskans already know — that there are ways to safely and responsibly diversify our domestic energy supply." Pro-Keystone Democrats have also been quietly pointing to a section of the State Department report that projects an increase of six more deaths annually if the extracted oil is shipped by rail instead of pipeline. (The study did not take into account the nearly four dozen people killed in an oil train derailment last summer in Quebec.) But other Democrats, and independent Vermont Sen. Bernie Sanders, argue that the president would betray his commitment to battling climate change if he signs off on the pipeline. Show votes in Congress last year over budget plans determined that a filibuster-proof majority of senators support the pipeline.

Republicans

Senate Minority Leader Mitch McConnell of Kentucky is among the high-profile Republicans pushing Obama to use his executive authority to approve the pipeline.

"Please pick up that pen you've been talking so much about and make this happen," McConnell said.

Republicans are increasingly saying that they see the pipeline as inevitable and are aggressively touting a section of the State Department report that projects the pipeline project would inject $3.4 billion into the economy.