Keystone XL pipeline blocked by federal judge in Montana, throwing project's future into doubt

WATCH ABOVE: Months after the Keystone XL pipeline through the U.S. was approved by the Trump administration, an American court put everything on hold. Vinesh Pratap has more on the implications in Alberta.

The future of TransCanada’s Keystone XL pipeline has been thrown into doubt after a federal judge in Montana blocked its construction, citing the State Department’s disregard of climate change.

U.S. District Judge Brian Morris on Thursday ruled that the U.S. State Department didn’t look closely enough at factors such as the project’s viability in the face of lower oil prices, new modelling of possible oil spills and ways to mitigate them, or at the impacts of greenhouse gas emissions.

But one of the biggest reasons the pipeline’s approval has been shot down is that the Trump administration dismissed concerns about climate change that had been raised when it was denied a permit two years ago.

Coverage of the Keystone XL pipeline on Globalnews.ca:

Morris noted that the U.S. State Department denied a permit to Keystone XL in 2015, relying at the time on the country’s “role in climate leadership.”

But then the State Department issued a new decision on the pipeline, arguing that “a decision to approve proposed project would support U.S. priorities relating to energy security, economic development, and infrastructure.”

Morris said the State Department had the authority to prioritize energy security more highly than it did in 2015.

However, he also cited legal decisions asserting that, “even when reversing a policy after an election, an agency may not simply discard prior factual findings without a reasoned explanation.”

The State Department, Morris said, “did not merely make a policy shift in its stance on the United States’ role on climate change. It simultaneously ignored the 2015 section titled ‘Climate Change-Related Foreign Policy Considerations.”

That section served as a “significant basis” for denying Keystone XL a permit, as it saw the U.S. accept its role as the world’s biggest economy and the second-biggest emitter of greenhouse gases.

The 2017 decision, Morris said, omitted a whole section of the 2015 rejection that discussed climate change.

READ MORE: Additional environmental assessment ordered for Keystone XL pipeline

That whole discussion was omitted with one paragraph that said there have been “numerous developments related to global action to address climate change, including announcements by many countries of their plans to do so.”

“Once again, this conclusory statement falls short of a factually-based determination, let alone a reasoned explanation, for the course reversal.”

“An agency cannot simply disregard contrary or inconvenient factual determinations that it made in the past, any more than it can ignore inconvenient facts when it writes on a blank slate.”

Environmentalists react

In a statement, environmental group, the Sierra Club, said the Trump administration “violated bedrock U.S. environmental laws when approving a federal permit” for the pipeline.

“The Trump administration tried to force this dirty pipeline project on the American people, but they can’t ignore the threats it would pose to our clean water, our climate and our communities,” Sierra Club lawyer Doug Hayes said in the statement.

Greenpeace’s Mike Hudema called Morris’ move a “significant setback” for the pipeline project and a “big win for Indigenous defenders, the environment, and for the thousands of people who have been fighting this pipeline for nearly a decade.”

“This should also be huge warning sign to the Liberal government about the inevitable legal hurdles they will face if they continue to rush and curtail the Trans Mountain assessment process,” added Hudema in the statement.

“The science is clear. We can’t afford new fossil fuel infrastructure if we want to save the planet. New tar sands pipeline projects threaten Indigenous rights, put drinking water and communities at risk, accelerate the climate crisis and move us in the wrong direction. If we are serious about halving emissions from fossil fuels in the next 10 years and avoiding  climate catastrophe, we must drop any new tar sands pipelines, full stop.”

The proposed Keystone XL pipeline would span 1,897 kilometres, carrying crude product from Hardisty, Alta. to Steel City, Neb.

This decision doesn’t represent the first legal setback for the pipeline.

In August, Morris ordered an environmental assessment for an alternate pipeline route that Nebraska had approved after TransCanada had proposed a different one through that state.

At that time, he hadn’t revoked the presidential permit for the pipeline.

READ MORE: Donald Trump gives the green light to ‘incredible’ Keystone XL pipeline

U.S. President Donald Trump made the approval of Keystone XL a key plank in his election campaign, eventually approving it in March 2017.

Investors, however, were skeptical at the time as they expected further hurdles to its realization.

TransCanada hasn’t yet made a final investment decision on the project.

Industry reacts

“A lack of competitiveness and market access continue to be among some of the most significant challenges facing the Canadian oil and natural gas industry,” CAPP said in an email to Global News.

“The Canadian Association of Petroleum Producers is disappointed with the United States’ federal court judge’s decision to block Keystone XL.

“This decision further reinforces the need for Canada to export its oil and natural gas to new global markets – ensuring fair market value for our natural resources, helping to meet growing global demand, and expanding our customer base beyond the U.S.”

The judge’s decision is embedded below:

Keystone XL ruling – Nov. 8, 2018 by Emily Mertz on Scribd

  • With files from The Associated Press

© 2018 Global News, a division of Corus Entertainment Inc.

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