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Obama rejects Keystone XL pipeline

Green groups are celebrating today the Obama Administration's decision to reject TransCanada's Keystone XL pipeline.

"The pipeline was rejected for all the right reasons," Frances Beinecke, president of the Natural Resources Defense Council, said in a statement. "President Obama put the health and safety of the American people and our air, lands and water -- our national interest -- above the interests of the oil industry."

News reports in the Washington Post indicated that an official rejection announcement was coming this afternoon, which it did, after a flurry of news reports and speculation.

The decision came just weeks after Congress passed a payroll tax package forcing the administration to make a decision on Keystone XL by Feb 21, 2011.

But as White House press secretary Jay Carney explained Tuesday, that wasn't nearly enough time for the State Department to review an alternate route for the pipeline, all but assuring its rejection.

"[E]veryone — a lot of people, and certainly we — made clear back in December that a political effort to short-circuit that process for ideological reasons would be counterproductive because a proper review that weighed all the important issues in this case could not be achieved in 60 days,” Carney told reporters in Washington, DC.

Shares in TransCanada Corp reportedly fell swiftly today, as much as five percent, amidst news reports that an Obama rejection was imminent.

Obama's political opponents were quick to decry today's announcement. "President Obama’s decision to block the Keystone XL energy pipeline is both economically destructive and politically self-serving," Republican National Committee Chairman Reince Priebus said in a statement.

The White House's decision still leaves room for TransCanada to reapply for a Presidential Permit, assuming it agrees to develop an alternate route through Nebraska's sensitive Sandhills region.

"If TransCanada reapplies," the NRDC's Beinecke continued in her statement, "Keystone XL will still face the same valid public concerns and fierce opposition as the first time. No matter how many times it is proposed, Keystone XL is not in the national interest."

Today's rejection will almost certainly increase pressure to approve Enbridge's Northern Gateway proposal, which just began public hearings last week.

For in-depth coverage of Keystone XL and oil sands politics in Washington, DC, check out The Tyee's 15-part series from last spring.

Geoff Dembicki reports on energy and climate issues for The Tyee.

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