US issues new review of Keystone XL crude line

Fri Apr 15, 2011 4:27pm EDT

Related Topics

* State review does not change conclusions of first report

* State says oil sands fuels emit more greenhouse gases

* Enviro groups say the additional review still inadequate

By Ayesha Rascoe and Timothy Gardner

WASHINGTON, April 15 (Reuters) - The U.S. State Department on Friday issued additional environmental analysis of the $7 billion pipeline project slated to bring crude from Canadian oil sands to the Gulf Coast, but green groups quickly dismissed the assessment.

The additional review does not change the conclusions reached in agency's first analysis of TransCanada Corp's (TRP.TO) proposed Keystone XL pipeline, which said there would be limited adverse environmental impacts from the project.

The planned 1,700 mile pipeline, which would span an area from Oklahahoma to the Gulf Coast, has run into stiff opposition from some lawmakers from states along the proposed route. The foes are concerned about pontential leaks over fragile water supplies.

Green groups also oppose the line because of the additional greenhouse gas emissions from the production of oil sands.

Following Environmental Protection Agency complaints about its initial analysis, the State Department said last month it would undertake the supplemental review, delaying the pipeline project. [ID:nN15282608]

The department's supplemental review included a more in-depth evaluation of the greenhouse gas consequences of the project, an issue the EPA said did not receive adequate attention in the initial version released April last year.

"It is clear that (oil sands derived) crude oils, as would likely be transported through the proposed project, are on average somewhat more GHG-intensive than the crudes they would displace in the U.S. refineries," the supplemental review said.

The department said the difference between oil sands crude and traditional fuels would decrease over time, as more oil required energy-intensive methods of extraction.

Despite the additional analysis, green groups said the review was still not sufficient.

"The State Department has still not done a serious and thorough analysis of significant dangers, including the safety of tar sands oil pipelines and the pollution caused by tar sands oil production," said Alex Moore, of Friends of the Earth.

The department will accept public comments on its supplemental review from April 22 through June 6. It said it still expects to make a final decision on whether to grant permit for project before the end of the year. (Additional reporting by Tom Doggett and Arshad Mohammed; Editing by David Gregorio)

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