Obama Administration Rejects Keystone XL Oil Pipeline

November 6, 2015, 4:23 PM UTC
Activists Rally In Washington Against Keystone XL Pipeline
WASHINGTON, DC - MARCH 07: Activists carry signs and petition boxes as they march to the State Department for a rally to protest against the Keystone XL pipeline March 7, 2014 in Washington, DC. Activists from various environmental groups delivered "more than 2 million comments to urge Secretary of State John Kerry and President Barack Obama to reject the project." (Photo by Alex Wong/Getty Images)
Photograph by Alex Wong — Getty Images

The Obama administration has rejected the Keystone XL oil pipeline that has divided petroleum interests and environmentalists for more than seven years.

President Barack Obama and Secretary of State John Kerry, who was charged with making a recommendation on the controversial project, met on Friday morning to discuss the issue ahead of public remarks made by Obama in the early afternoon.

Keystone XL would have linked existing pipeline networks in Canada and the United States to bring more than 800,000 barrels per day of crude from Alberta’s oil sands and some from North Dakota to refineries in Illinois and, eventually, the Gulf of Mexico coast.

TransCanada Corporation (TRP), the Canadian company that had hoped to build the pipeline, first sought the required presidential permit for the cross-border section in 2008.

The proposal inspired a wave of environmental activism that turned Keystone XL into a rallying cry to fight climate change. Blocking Keystone became a litmus test of the green movement’s ability to hinder fossil fuel extraction in Canada’s oil sands.

“This is a big win,” said Bill McKibben, the co-founder of 350.org, an environmental group. “President Obama’s decision to reject Keystone XL because of its impact on the climate is nothing short of historic, and sets an important precedent that should send shockwaves through the fossil fuel industry.”

TransCanada and other oil companies said the pipeline would have strengthened North American energy security, created thousands of construction jobs and helped to relief a glut of oil in the country’s heartland.

But since 2008 the United States has experienced a drilling boom boosting oil production 80 percent and contributing to a slump in oil prices from above $100 a barrel to about $44.