U. S. rejects TransCanada request for delay

Rebuffs TransCanada’s request that’s viewed as attempt to dodge rejection

TransCanada Corp. failed in its attempt to pause the U. S. review of its Keystone XL pipeline, keeping the project where it started the week — unlikely to advance under the Obama administration.

The State Department said Wednesday it has notified the Calgary- based company that the review, in its eighth year, will continue. It was responding to a letter Monday to Secretary of State John Kerry, in which TransCanada requested a suspension of the assessment while Nebraska regulators conduct their own.

The request was seen by some analysts as an attempt to circumvent an expected rejection by President Barack Obama, which the company denied.

“It’s the death of the project as long as Obama’s president,” Bob Schulz, a professor at the University of Calgary’s Haskayne School of Business, said. “There’s zero per cent probability Obama’s going to say ‘ Yes.’ ”

Obama has been critical of Keystone XL, one of the most contentious energy issues during his time in office. The U. S. review has split lawmakers and hurt relations with Canada, which is seeking to expand markets for its crude.

“We’ve told TransCanada that the review process will continue,” State Department spokesman John Kirby told reporters in Washington. He said Kerry wanted to finish work on the review after “all that has gone into it.”

TransCanada said it respects the department’s decision and will keep trying to advance the project.

“Our efforts will continue to demonstrate that Keystone XL is in the national interest of the United States,” spokesman Mark Cooper said in an email.

Keystone XL would span almost 1,900 kilometres from Alberta through three states — Montana, North Dakota and Nebraska — before connecting to an existing pipeline network supplying U. S. Gulf Coast refineries. The State Department has jurisdiction over the pipeline because it crosses a U. S. border.

Five reports and 17,000 pages of State Department review have shown the project’s benefits over the past seven- plus years, said Cooper.

“The fundamental question remains: Do Americans want to continue to import millions of barrels of oil every day from the Middle East and Venezuela?”

“Or, do they want to get their oil from North Dakota and Canada through Keystone XL?” he said. “We believe the answer is clear and the choice is Keystone XL.”

Frank Benenati, a White House spokesman, declined to comment Wednesday. A day earlier, the White House press secretary had cast doubt on the justification for halting the review.

“Given how long it’s taken, it’s — it seems unusual to me to suggest that somehow it should be paused yet again,” Josh Earnest said. Reaching a final decision on

They saw a potential checkmate on the horizon and they made their best counter move. The U. S. just called them on it.

the project by the end of Obama’s second term remains “the current plan,” he said.

TransCanada chief executive Russ Girling, on a Tuesday earnings conference call, said the company’s request had nothing to do with politics and was meant to let the outcome of a regulatory assessment of the pipeline in Nebraska be considered in the State Department’s review. The Nebraska review is due to extend well into 2016.

The bid by the company now looks like an unsuccessful move in a game of chess, said Martin Pelletier, managing director and portfolio manager at TriVest Wealth Counsel Ltd. in Calgary.

“They clearly saw a potential checkmate on the horizon and they made their best counter move and the U. S. just called them on it,” Pelletier said.

He predicted Obama will deny the pipeline instead of leaving it to his successor, to secure his environmental legacy.

“You’ll get a rejection,” said Pelletier.