State Department Delays Oil Pipeline, Officials Say

Washington – The State Department was expected to announce later Wednesday that it cannot recommend going forward with the proposed Keystone XL oil pipeline within the 60-day deadline set by Congress, putting the politically charged project on hold indefinitely, administration officials said.

The administration has until Feb. 21 to decide the fate of the 1,700-mile pipeline to carry heavy crude oil from formations in Alberta, Canada, to refineries on the Gulf Coast. Officials are expected to announce that they cannot meet that deadline and that they are looking for ways to complete a thorough environmental review before making a final decision on the project.

The action for now means the permit for the pipeline is rejected although the pipeline company will be allowed to submit a new proposal with an altered route. The Obama administration had sought a year’s delay to find a new route for the pipeline. But Republicans in Congress demanded that the administration accelerate the schedule and make a decision by mid-February, and included that provision in the payroll tax bill passed last month.

The State Department is expected to say that routing, environmental and safety concerns raised by the project are too complex to be decided on that abbreviated timetable and is recommending that President Obama reject it for the time being.

The pipeline has become a political flashpoint, with proponents saying it will create thousands of jobs and help wean the nation off of Middle Eastern oil, while opponents charge that it furthers dependence on dirty fuels and threatens sensitive lands and water supplies in the Great Plains.

The White House spokesman, Jay Carney, at a briefing with reporters Wednesday before the State Department released its announcement, was sharply critical of the Republican-sponsored legislation that he said had forced a decision before the project could be fully studied.

“In a purely partisan effort to score a political points, Republicans in Congress insisted on inserting an extraneous provision in a bill that had nothing to do with pipelines,” he said. “The State Department has made it clear that setting an arbitrary deadline through this purely political effort would put State Department in a corner and severely hamper their ability to review an alternate route, a new pipeline route, in a proper way.”

A spokesman for Speaker John A. Boehner’ put out a response, based on news reports of the State Department’s recommendation, reminding everyone that the language in the payroll tax bill stipulates that only the president has authority to block the permit — not the State Department.

“President Obama is about to destroy tens of thousands of American jobs and sell American energy security to the Chinese,” said Brendan Buck, Mr. Boehner’s spokesman. “The president won’t stand up to his political base even to create American jobs. This is not the end of this fight.”

The Republican presidential candidates have all endorsed the pipeline, saying it will create jobs, and have used it as a cudgel to criticize Mr. Obama. They say that his reluctance to quickly approve the project is harming the economy and forcing Canada to seek other markets for its oil.

“As to the pipeline,” former Gov. Mitt Romney of Massachusetts said at a recent campaign appearance in South Carolina, “how in the world can anyone justify saying to Canada: ‘We don’t want that pipeline coming here. We know it’s important for you to be able to make progress and provide for your own finances. We know that if we stall long enough, you’ll not have the opportunity to bring a pipeline to America. Instead you’ll build a pipeline for China.’ “

A spokesman for TransCanada, the company proposing to build the pipeline, said he would have no comment until an official announcement on Keystone XL was made.

Earlier Wednesday, two dozen Democratic members of Congress wrote to the president urging him to kill the pipeline.

“We strongly believe the Keystone tar-sands pipeline poses a serious threat to the environment and public health that cannot be mitigated by the benefits of the project,” the lawmakers said. “And we fully support your recent decision to extend the ongoing review process. We strongly oppose an expedited review process and urge you to reject the tar-sands pipeline because of the unnecessary and inappropriate short circuiting of the review process.”

The American Petroleum Institute, the industry’s main lobbying group, is pushing hard for the project, undertaking a multimillion-dollar lobbying and advertising campaign promoting the energy and economic benefits of Canadian oil and the pipeline to carry it through the United States.

Environmental groups are also waging a vigorous campaign against the pipeline, with two big White House protests last year and another demonstration planned for next week on the steps of the Capitol.

“We think the pipeline should be rejected,” said Susan Casey-Lefkowitz. director of the international program at the Natural Resources Defense Council, an environmental group. “The president has enough information to reject it as not in the national interest.”

Bill McKibben, an environmental activist who organized the White House protests against the pipeline, praised the decision to put the project on hold before it was officially announced.

“Assuming that what we’re hearing is true, this isn’t just the right call, it’s the brave call,” Mr. McKibben said in an e-mail. “The knock on Barack Obama from many quarters has been that he’s too conciliatory. But here, in the face of a naked political threat from Big Oil to exact ‘huge political consequences,’ he’s stood up strong.

“This is a victory for Americans who testified in record numbers, and who demanded that science get the hearing usually reserved for big money.”