FAQs: Keystone XL oil pipeline project

The Keystone XL oil pipeline project, which would funnel crude from the Alberta oilsands to Texas, is being touted for its potential economic benefits, but questions loom over its possible effects on the environment.
The Keystone XL pipeline project will extend TransCanada Corp.'s Keystone pipeline that carries oil from northern Alberta to refineries in the United States. (TransCanada )

For those who support it, the Keystone XL pipeline project is the way of the future. They say TransCanada Corp.'s ribbon of steel funnelling crude oil from Alberta to Texas will bring untold benefits, from security in the North American energy supply to thousands of jobs and economic benefits for the communities along the pipeline’s path.

Not so fast, say others, who see nothing good if the $7.6-billion US project goes ahead. Those who oppose the project cite the potential environmental impact of the pipeline, on both the areas it goes through and the original source of the crude: the oilsands of northern Alberta.

What is the Keystone XL project?

The Keystone XL project is an expansion of Calgary-based TransCanada Corp.'s existing Keystone pipeline system, and will carry up to 830,000 barrels of crude per day from northern Alberta to refineries in Oklahoma and the Gulf Coast in Texas.

TransCanada says the pipeline "will play an important role in linking a secure and growing supply of Canadian crude oil with the largest refining markets in the United States, significantly improving North American security supply."

Where will the pipeline go?

The Keystone XL project is an addition to the already completed $6-billion Keystone pipeline that begins in Hardisty, Alta., crosses into Saskatchewan and Manitoba, and then heads south through North Dakota, South Dakota and Nebraska.

Rail cars arrive in Milton, N.D., on Feb. 28, 2008, loaded with pipe for the first Keystone Pipeline project, which now carries crude oil across Saskatchewan and Manitoba, and through North Dakota, South Dakota, Nebraska, Kansas, Missouri and Illinois. (Eric Hylden, Grand Forks Herald/Associated Press)

That pipeline continues east through Kansas and Missouri to Illinois. Another section runs south through Kansas to Cushing, Okla.

As proposed initially, the 2,673-kilometre Keystone XL pipeline would begin in Hardisty and run southeast through Saskatchewan, crossing the border with the U.S. at Moncy, Sask. The pipeline would run south through Montana, and continue south through South Dakota and Nebraska, meeting up with the existing Keystone pipeline in Steele City, Ne. In November 2011, TransCanada agreed to change the proposed route so that it wouldn't pass through the environmentally sensitive Sandhills area of Nebraska.

The proposed project would also extend the existing Keystone pipeline south from Cushing, Okla., to Port Arthur and Houston in Texas.

The Canadian portion of the project extends for about 529 kilometres and will cost $1.7 billion.

How would it be built?

TransCanada says the pipeline will be underground. The bottom of the 0.91-metre-diameter steel pipe will be 1.2 metres below the ground surface.

In instances where the pipeline passes underneath rivers, the pipeline would be up to 7.6 metres below the river bottom.

TransCanada has said the corporation has obtained easements from 90 per cent of the landowners over whose property the pipeline will cross. The easements are 15.2 metres wide.

In Texas, a farmer lost her bid to prevent Trans-Canada from expropriating part of her property to build the pipeline. A county court upheld the company's status as a common carrier in August 2012, and turned down Julia Trigg Crawford’s application to take the issue to a civil trial.

Who supports the project?

Supporters of the project include the Canadian government, several U.S. governors, the Canadian Association of Petroleum Producers, the American Petroleum Institute and the U.S. Chamber of Commerce.

On its website, TransCanada includes letters of support from U.S. local governments, U.S. state and federal politicians and numerous organizations.

In Canada, the National Energy Board approved the project on March 11, 2010.

The board said in a news release that the project is in the public interest and accepted that the pipeline would connect a large, long-term and strategic market for Western Canadian crude with the U.S. Gulf Coast "in a manner that would bring economic and other benefits to Canadians."

Supporters say environmental concerns about the project are overblown, and argue that the pipeline will create jobs —TransCanada points to a study that suggests it could create more than 20,000 manufacturing and construction jobs in 2011/12 — and reduce the nation's dependence on oil from the Middle East.

Who is against the project?

Opposition to the project is coming particularly from environmental activists, who are concerned it could affect underground and surface water supplies, increase air pollution around refineries and harm wildlife.

The Keystone pipeline route is being altered to avoid the Sandhills region in north central Nebraska. (Nati Harnik/Associated Press)

Of particular concern has been the pipeline's proposed route across the Sandhills, and the Ogallala aquifer, which supplies drinking water to about two million people in Nebraska and seven other states.

"This resource is the lifeblood of Nebraska's agricultural economy," Nebraska Gov. Dave Heineman said in a letter to U.S. President Barack Obama and Secretary of State Hillary Clinton urging them to deny the federal permit for the pipeline. "Cash receipts from farm markets contribute over $17 billion to Nebraska's economy annually. I am concerned that the proposed pipeline will have potentially detrimental effects on this valuable natural resource and Nebraska's economy."

Those opposing the pipeline have also criticized what they consider inadequate pipeline safety and emergency spill responses.

The project has attracted high-profile opposition from individuals ranging from the Dalai Lama and former U.S. vice-president Al Gore to Archbishop Desmond Tutu and several Nobel Prize winners. Actress Daryl Hannah and Canadian author and activist Naomi Klein were among about 1,250 people arrested outside the White House in Washington, D.C. during a two-week civil disobedience campaign against the project.

What other issues lie underneath the debate?

Underscoring much of the discussion and opposition is the debate over the development of the oilsands in northern Alberta and the impact of oil extraction there on the production of greenhouse gases.

What has happened to the proposal?

The U.S. State Department was reviewing Keystone's application for a presidential permit, required because the project crosses an international border with the United States, when it ordered an assessment for a new route.

In November 2011, the State Department deferred making a decision on Keystone until after the 2012 presidential election, citing concerns about the risks posed to an environmentally sensitive aquifer in Nebraska.

Republicans then held the administration's feet to the fire, successfully inserting pipeline provisions into payroll tax cut legislation in late December.

Within a month, facing a mid-February deadline imposed by that measure, U.S. President Barack Obama nixed TransCanada's existing permit outright, saying there wasn't enough time to thoroughly review a new route before giving it the green light.

Obama assured Prime Minister Stephen Harper that the decision did not reflect on the pipeline's merits, but was merely necessitated by Republican pressure tactics. He welcomed TransCanada to propose another route.

In March 2012, Obama directed U.S. federal agencies to fast-track the approval process for the southernmost portion of the pipeline, a 780-kilometre section that stretches from Oklahoma to refineries on Texas' Gulf Coast. TransCanada began construction in Texas in August 2012.

TransCanada submitted a new presidential permit application for Keystone XL in May 2012.

In September 2012, TransCanada submitted an environmental report on a proposed revised route through Nebraska. The company says the new route minimizes the potential impact on the Sandhills region and avoids two small city well fields.

What happens next?

The pipeline has become a political hot potato in the U.S. presidential campaign, with the issue drawing attention from both Obama and Republican presidential candidate Mitt Romney. The U.S. State Department has said it expects to make a decision on the presidential permit by the first quarter of 2013.

If that decision is in Trans-Canada's favour, the company has said it would expect to begin construction in the first quarter of 2013, with the pipeline likely to transport its first oil in late 2014 or early 2015.

With files from The Associated Press and The Canadian Press