Summary
In
May 2012, Canadian pipeline company TransCanada reapplied to the U.S.
Department of State for a Presidential Permit to build the Keystone XL
pipeline. The pipeline would transport crude oil from the oil sands
region of Alberta, Canada, to the existing Keystone Pipeline System in
Nebraska. It also could accept U.S. crude from the Bakken oil fields in
Montana and North Dakota. A second segment of the Keystone XL pipeline
system, the Gulf Coast Project, is proceeding separately to connect
existing pipeline facilities in Oklahoma to refineries in Texas. When
completed, the entire Keystone XL pipeline system would ultimately have
capacity to transport 830,000 barrels of crude oil per day to U.S.
market hubs. TransCanada submitted the May 2012 permit application after
its 2008 Keystone XL permit application was denied.
The
State Department has jurisdiction over the Keystone XL pipeline’s
approval because it would cross the U.S. border. Before it can approve
such a permit, the department must determine that the project is in the
“national interest,” accounting for potential effects on the
environment, economy, energy security, and foreign policy, among other
factors. Environmental impacts are considered under the National
Environmental Policy Act, as documented in an Environmental Impact
Statement (EIS). For the 2008 permit application, a final EIS was issued
in August 2011, followed by a public review period. Largely in response
to public comments and efforts by the state of Nebraska, the State
Department determined that it needed to examine alternative pipeline
routes that would avoid the environmentally sensitive Sand Hills region
of Nebraska, a sand dune formation with highly porous soil and shallow
groundwater that recharges the Ogallala aquifer.
The
Temporary Payroll Tax Cut Continuation Act of 2011 (P.L. 112-78)
required the Secretary of State to approve or deny the original 2008
project application within 60 days. On January 18, 2012, citing
insufficient time under this deadline to properly assess the
reconfigured project, the State Department denied the Keystone XL
permit. Since then, TransCanada has worked with Nebraska officials to
identify a pipeline route avoiding the Sand Hills. Its May 2012 permit
application reflects that effort. The State Department has begun the
NEPA process anew, but will largely supplement the August 2011 final EIS
to include analysis of the new route in Nebraska, as well as analysis
of any significant environmental issues or information that has become
available since August 2011. The department estimates that it will
determine whether to approve or deny the new Presidential Permit by
early 2013.
The
112th Congress debated numerous legislative options addressing the
Keystone XL pipeline. The North American Energy Access Act (H.R. 3548)
would have transferred permitting authority for the Keystone XL pipeline
project to the Federal Energy Regulatory Commission, requiring issuance
of a permit within 30 days of enactment. Several other bills (H.R.
3811, H.R. 4000, H.R. 4301, S. 2041, and S. 2199) would have approved
immediately the 2008 permit application filed by TransCanada. A House
bill (H.R. 6164), the Domestic Energy and Jobs Act (S. 3445), and
S.Amdt. 2789 would have eliminated the Presidential Permit requirement
for the reconfigured Keystone XL pipeline as proposed in TransCanada’s
permit application filed on May 4, 2012. S. 2100 and H.R. 4211 would
have suspended sales of petroleum products from the Strategic Petroleum
Reserve until issuance of a Presidential Permit for the Keystone XL
project. H.R. 3900 sought to ensure that crude oil transported by the
Keystone XL pipeline, or resulting refined petroleum products, would be
sold only into U.S. markets. To date, no Keystone XL legislation has
been proposed in the 113th Congress but the issues surrounding the Presidential Permit remain largely the same.
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