Energy departments in Canada and the US continue to shape the regulatory wave propelled by the Keystone XL pipeline system.

TransCanada’s US$13 billion Keystone XL crude oil pipeline is proposed to run from Alberta to Texas, and has been under US regulatory review since 2008.

The US State Department has released its final Environmental Impact Statement (EIS) for the project. The report found no expectation that the pipeline’s construction and operation will have excessive environmental impacts (spanning concerns for water, air and greenhouse gas emissions).

With the final EIS’s publication, the Department holds a 90-day review period regarding Keystone’s relationship to the “national interest.” Final approval or rejection should be announced by the end of 2011.

Politically, the pipeline has been divisive even after Canada provided its own regulatory approval. Federal Natural Resources Minister Joe Oliver has described the project as “enormously important” for both countries, while former Alberta Premier Peter Lougheed opposes its construction. Lougheed has suggested the oil and gas sector would benefit more from refining bitumen in the province instead of piping the crude product elsewhere.

By Cheryl Johnson, cjohnson@delphi.ca