Obama will urge fast-tracking of Keystone portion

U.S. President Barack Obama will tell federal agencies this morning to fast track the approval process for the leg of the Keystone XL pipeline from Cushing, Okla., to Texas refineries on the Gulf of Mexico, the White House says.

The administration said he will make the announcement on a visit to Cushing at roughly 11 a.m. ET.

Earlier, American oil industry executives chided Obama to push for approval of the entire pipeline proposed by Calgary-based TransCanada.   

"Approval of the entire Keystone XL pipeline should happen now — not after the election," the executives at several prominent oil and gas companies said in an open letter to Obama published Wednesday in The Oklahoman newspaper.

"America's greatest benefit will come when we can transport oil from our best energy partner, Canada, and oil-rich North Dakota and Montana."   

At a storage yard in Cushing, Okla., the starting point of the pipeline's southern half, Obama will reportedly call for the approval process to be expedited for that portion of Keystone XL in order to deal with a glut of oil from the Midwest.   

Jay Carney, White House press secretary, said "the president has been very clear ... about his support for the building of the pipeline, the so-called Cushing pipeline," Carney said Wednesday on Air Force One as Obama travelled west to tout his energy policies.   

Environmentalists crestfallen   

The Cushing storage yard houses pipes to be used in the construction of the pipeline from the oil hub to Gulf Coast refineries.

Currently, crude from oil-rich states like North Dakota and Montana runs into a logjam at Cushing because of a lack of pipeline capacity and a limited number of rail cars that can transport the oil south.   

The approval process for a pipeline can ordinarily stretch on for as long as a year. Obama wants to see several months slashed from that timeline.   

Environmentalists are crestfallen. They've mounted a massive campaign against Keystone XL, assailing the plan to transport millions of barrels a week of bitumen from the Alberta oilsands — an energy source they decry as "dirty oil" — through six U.S. states to Texas refineries.   

"The administration cannot purport to protect the climate while simultaneously bending over backward to allow a pipeline to the continent's biggest carbon bomb," Kim Huynh of Friends of the Earth said in a statement.   

Huynh wondered if environmentalists have been snookered.   

"Was the president's initial rejection of the Keystone XL simply a farce to temporarily appease the environmental voters who dared to hold him to his own promises about real leadership on the climate and shifting to 21st-century clean energy solutions? It would seem so."   

Bill McKibben, who spearheaded several White House anti-pipeline protests last summer, noted that some had suggested Obama rejected Keystone XL for purely political purposes.

Decision deferred in November   

"Cynics said he did so just to avoid disappointing young people before the election, and pointed out that he invited pipeline proponent TransCanada to re-apply for the permit. It's hard not to wonder if those cynics might be right," he wrote on the Huffington Post website.   

The U.S. State Department has yet to make a decision on the entire length of the proposed, $7.6-billion pipeline, saying it needs more time to conduct a thorough environmental review of a new route around an environmentally sensitive aquifer in Nebraska.   

State Department officials are assessing the project because it crosses an international border.   

In November, the State Department deferred making a decision on Keystone until after this year's presidential election, citing concerns about the risks posed to the aquifer.   

Pipeline proponents cried foul, however, accusing Obama of making a cynical political move aimed at pacifying the environmentalists in the president's political base and improving his chances of re-election.   

Outraged Republicans then successfully inserted pipeline provisions into payroll tax cut legislation in late December.

Gas prices near $4 US a gallon  

But within a month, facing a mid-February deadline imposed by that measure, Obama nixed TransCanada's existing permit outright, saying there wasn't enough time to thoroughly review a new route before giving it the green light.   

Obama also assured Prime Minister Stephen Harper that the decision did not reflect on the pipeline's merits, and that his hand was forced by Republican pressure tactics. He welcomed TransCanada to propose another route.   

News that Obama was set to speed up the approval process for the southern expanse of Keystone XL comes as prices at gas pumps in the U.S. continue to march towards $4 US a gallon.   

Republicans have been blaming Obama's energy policies for rising pump prices and have been relentlessly attacking him for rejecting the pipeline. Republican presidential hopeful Mitt Romney has repeatedly called Keystone XL a "no-brainer."    Obama was on a western energy jaunt this week, also visiting Nevada, New Mexico and Ohio to promote and defend his energy policies.   

The letter from the oil industry executives — one of whom, Continental Resources CEO Harold Hamm, is heading Romney's energy advisory team — also takes aim at the Obama administration for its proposals to repeal oil industry tax breaks.   

The dispatch adds that proposed environmental regulations could impose "increased costs and bureaucratic delays (that) will cripple America's energy production and halt the renaissance under way in our nation's steel, plastics, chemical and agricultural industries."