U.S. to conduct additional Keystone XL pipeline review

WASHINGTON/VANCOUVER (Reuters) - The U.S. State Department will conduct another environmental review of TransCanada Corp’s long-pending Keystone XL oil pipeline, a U.S. official said on Friday, a move that could lead to additional delays of the project.

A depot used to store pipes for Transcanada Corp's planned Keystone XL oil pipeline is seen in Gascoyne, North Dakota, January 25, 2017. REUTERS/Terray Sylvester

The so-called supplemental environmental impact statement was ordered by Judge Brian Morris of the U.S. District Court in Montana in his ruling on Nov. 8 that blocked construction of the pipeline planned to bring heavy crude from Canada’s oil sands to the United States.

Morris said in his ruling that previous environmental analysis of Keystone XL fell short of a “hard look” at the cumulative effects of greenhouse gas emissions and the impact on Native American land resources.

The $8 billion pipeline, which is supported by Canadian oil interests and U.S. refiners, but opposed by landowners and environmentalists, has been pending for a decade.

President Donald Trump announced a permit for the project soon after he took office. Former President Barack Obama nixed the pipeline, saying it would do little to help U.S. consumers and would add greenhouse gases.

TransCanada spokesman Terry Cunha said that the State Department’s announcement of an additional review was expected after the judge’s ruling.

Earlier this week, TransCanada asked Morris, the District Court judge, to allow it to resume some U.S.-based pre-construction activities blocked by the initial ruling.

Morris’ decision on Thursday gave the Calgary, Alberta-based company permission to resume some activity on the pipeline project, including project development work and stakeholder meetings.

It is not allowed to resume physical field work like moving pipe and equipment, preparing work camp sites or undertaking road upgrades at this time, Cunha said. Morris is set to rule on that work after Dec. 5.

“It is too soon to say what the injunction will mean to the timeline of the Keystone XL pipeline but we remain confident the project will be built,” Cunha said.

Reporting by Timothy Gardner in Washington and Julie Gordon in Vancouver; Editing by Leslie Adler