The Old Keystone is New Again By Peter Lindfield, published in the Telegraph-Journal 18th May 2012 TransCanada, the

Canadian pipeline company, has filed a new application with the U.S. State Department to build the Keystone XL pipeline that will transport crude oil from the Alberta tar sands to the American Gulf Coast. The application sets the stage for a new round of outrage and opposition not only to the pipeline, but to the tar sands themselves. President Obama had refused to support TransCanadas first proposal, claiming that there was insufficient time to undertake a thorough environmental review of the project. TransCanadas new proposal specifies alternative routes intended to avoid the environmentally sensitive area in the Sand Hills region of Nebraska that was deemed at risk from potential pipeline leaks. Because the pipeline crosses an international boundary, the U.S. State Department possesses jurisdiction over the project. It will be pressured to give TransCanadas new application a thorough environmental review especially after the political fallout over a less than rigorous assessment on its first proposal in 2010. The regulatory agency was pilloried for minimizing serious environmental hazards including risks to the aquifers of the original route. Some critics of the initial proposal will say that the new routes put forward by TransCanada would involve potentially the same damage in the event of a pipeline spill. Other opponents will claim that the fundamental concerns that underpin opposition to the pipeline will not be changed by a simple route modification. The Canadian government will heavily lobby Washington to gain early approval for the pipeline proposal. One of TransCanadas key concerns is that the proposal could get bogged down in a protracted environmental review. The company can count on House Republicans for support. Congress is under pressure to force Mr. Obama to make a quick decision on the project which would once again mean an inadequate environmental review. The Senate resisted pressure to force the president to truncate the review process the first time but it remains to be seen whether a similar defense can be mounted this time. A superficial review of the politics and economics of the pipeline would have it that the project is a winning proposition on all counts. Keystone XL supporters have pointed to the job creation, the potential of reductions in gas prices and a decreased dependence on foreign oil as other benefits to the U.S. economy. The Canadian government will face stiff opposition to its lobbying efforts. Critics argue that extracting oil from tar sands is an extremely energy-intensive process with a significant environmental impact. Oil from tar sands produces more greenhouse gases than conventional oil extraction. This has made Canada the focus of heavy criticism in the U.S. and even more so in Europe. Opponents to the Keystone XL pipeline will contribute few benefits to Americans who point to the likelihood that most of the Keystone

XL oil will be targeted for export. Those who are outraged that the pipeline may threaten the environment are bracing for a renewed battle with industry. Natural Resources Minister Joe Oliver has characterized those who oppose oil sands and pipeline projects as radicals dedicated to limiting economic growth. "We hear a lot from environmental groups, and that's fine, and we should hear from oil companies and from others who may be able to bring some facts to the table," Mr. Oliver said. The Canadian government has shifted from its claim that the oil extracted from the tar sands is ethical oil to an aggressive position that the tar sands are a critical and necessary contributor to the Canadian economy. This has become the key justification of federal government support while opposition to the Keystone XL project and to the tar sands has come to mean opposition to jobs and prosperity. Peter Lindfield is chairman and CEO of the Carlisle Institute, a New Brunswick-based think-tank. He can be reached at peter.lindfield@carlisleinstitute.org. His column appears Tuesday and Friday.