OIL AND GAS:

Pipeline's short shutdown buoys foes of Keystone XL project

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A brief, voluntary shutdown of the 2,100-mile Keystone oil pipeline today is giving environmentalists still more fodder to press the White House for a rerouting order on its proposed sequel, Keystone XL.

The first Keystone link, which began shipping Canadian oil-sands crude to Midwestern refineries last year, was taken offline for a voluntary inspection after a weather-induced power outage, according to a spokesman for its operator, Alberta-based TransCanada Corp. The company "will work to make up deliveries this month and expect[s] no further interruption," TransCanada spokesman Terry Cunha added today via email.

But at a time when the XL project grows more politically daunting for President Obama with each passing day, thanks to an emboldened opposition fueled by green and liberal advocates, even a minor blip for Keystone gave TransCanada's critics new ammunition to call for a delay in approving its second pipeline.

The fiery push-back from conservationists to the Keystone I announcement was stoked further by a Reuters report that the State Department is considering an edict that TransCanada move its XL pipeline away from the ecologically sensitive soil of Nebraska's Sandhills.

Among the environmentalists seizing on the Keystone I shutdown today was National Wildlife Federation Senior Vice President Jeremy Symons, who has testified on Capitol Hill against the XL line several times in recent months.

"The repeated spills and shutdowns of Transcanada's latest pipeline is a clear warning that President Obama should call for a review of the safety of all tar sands pipelines," Symons said in a statement. "It is too risky to let TransCanada build the new Keystone XL pipeline when the tar sands pipelines already built keep leaking."

Should State call for a rerouting of the $7 billion XL line, it would have no shortage of bipartisan cover -- Nebraska Gov. Dave Heineman (R) is among several GOP officials in his state to vow support for a rerouted pipeline -- though TransCanada has warned that finding a new path would derail the project thanks to the fiscal consequences of delay.

Underscoring the degree to which the administration is caught between industry proponents of the 1,700-mile XL line and its foes in the green movement, the American Petroleum Institute (API) also fired off a statement to "again call on the president to stick to his word" and rule on the project by year's end.

"Each delay has bred nothing but more delay, which is standing in the way of safely moving vital energy for American consumers and the overall economy," API refining manager Cindy Schild said.

While the administration initially said a final decision on Keystone XL was expected before 2012, rendering unnecessary a House GOP bill that set a November deadline, State said earlier this month that the time frame could slip.

State spokesman Mark Toner told reporters today that the department continues to vet "all possibilities" for the XL line, including a reroute within Nebraska and a full-scale disapproval of the pipeline proposal. "All of the suggestions made during the public meetings [on the pipeline] ... are being taken seriously under consideration," Toner said.