Breaking News: Obama Rejects Keystone XL Pipeline

What’s the Latest Development?

In response to a federally mandated deadline of February 21, the Obama administration has rejected a Canadian company’s application to build an oil pipeline from Canada’s tar sands to the American gulf. “However, the administration will allow TransCanada to reapply after it develops an alternate route through the sensitive habitat of Nebraska’s Sandhills.” The administration originally delayed approval of the pipeline because the proposed route crosses over the nation’s largest water aquifer, located in the Sandhills.

What’s the Big Idea?

The rejection of the Keystone XL pipeline may prove a serious setback for Canada, which is increasingly eager to export the lucrative crude found in its tar sands. This year, Canada became the first and only nation to withdraw from the Kyoto protocol, a treat which requires carbon emission reductions. Until the recent rise in cost of oil, in both political and financial terms, Canada’s tar sands were considered too cost inefficient to exploit. The process of removing oil remains difficult and requires energy-intensive processing.

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