EPA worried by TransCanada's Keystone pipeline

The U.S. government's environmental watchdog has raised new concerns about a proposed pipeline that would carry oil to Texas's Gulf Coast. from Western Canada.

In a letter to the U.S. State Department, the assistant administrator for enforcement for the Environmental Protection Agency said she is concerned about the risk of oil spills that could affect drinking water and sensitive ecosystems, as well as the effect of greenhouse gas emissions associated with the proposed 3,000-kilometre Keystone XL pipeline.

"We have a number of concerns regarding the potential environmental impacts of the proposed project, as well as the level of analysis and information provided concerning those impacts," Giles said in a letter released Tuesday.

Open barely a year, TransCanada wants to increase the $7-billion pipeline's capacity to bring more oil to refineries in the U.S. South. Currently the 500,000-barrel-a-day pipeline goes to the refining hub of Cushing, Okla. ,but an expansion to double that would bring Canadian oil directly to the U.S. Gulf Coast.

The first phase pipeline has already had a number of high-profile leaks, including a small one in Kansas last week and a larger one in North Dakota in early May. In addition to the number of leaks, the pipeline's opponents say the heavy oil that comes from oilsands is especially dangerous for sensitive aquifers and ecosystems along the route.

The EPA said that despite two lengthy reports, the State Department still has not done sufficient analysis of the project's impact on the environment. The letter urged State to conduct a more thorough analysis of oil spill risks and alternative pipeline routes.

In 2008, the last year for which statistics are available, Canada exported roughly 1.5 million barrels a day to the United States. A fully maximized Keystone pipeline would increase that significantly.

 "I am generally supportive of receiving more oil from Canada," Secretary of State Hillary Clinton told a Congressional committee in March.

The State Department is set to rule on the issue within the year.