Keystone XL Oil Pipeline Progress Halted by U.S. Federal Court
(Bloomberg) -- TransCanada Corp.’s long-troubled Keystone XL oil pipeline project hit another roadblock as a U.S. District Court in Montana ruled it must wait for a further environmental review.
- The court blocked any activity furthering the construction or operation until the U.S. State Department completes a supplement to a 2014 environmental impact statement that complies with the National Environmental Policy Act and the Administrative Procedure Act.
- The 1,179-mile conduit from western Canada to the central U.S. has faced opposition almost since its inception, as environmentalists see it allowing the further expansion of carbon-intensive oil sands production in Alberta.
- President Donald Trump approved a permit for the pipeline in January 2017, reversing a 2015 decision by his predecessor Barack Obama.
- The pipeline would help carry 830,000 barrels of crude a day from Alberta to Steele City, Nebraska, where it could then move on to refineries in the central U.S. and Gulf Coast.
- Western Canadian Select crude oil is selling at about $18 a barrel as its discount to U.S. benchmark West Texas Intermediate as a lack of pipeline capacity bottlenecks production in Alberta.
- U.S. benchmark WTI little changed after the decision, trading down 0.1 percent.
- No immediate impact in oil markets as the pipeline isn’t scheduled to come online for years regardless of the ruling.
- Canadian dollar extended its decline after the news, trading down 0.2 percent versus the dollar at $1.3182.
©2018 Bloomberg L.P.