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White House: Keystone pipeline review needs time

By Laura MacInnis and Aruna Viswanatha

WASHINGTON (Reuters) - The White House said on Thursday that finding an alternate route for the Keystone XL oil pipeline from Canada to Texas would take time and any effort to circumvent the approval process would be "counterproductive."

President Barack Obama faces a February 21 deadline set by Congress to either allow TransCanada's $7 billion pipeline to be built or determine the project is not in the national interest of the United States.

Speculation in Washington is rampant on how Obama will address the tricky political question, which divides two key parts of his base during an election year.

Most labor unions support the project, which will bring their members jobs. But Green groups have made defeating it a top priority because processing Canadian oil sands into crude produces carbon emissions.

White House spokesman Jay Carney declined to say whether the deadline would force the Obama administration to reject the project, but he reiterated concerns about a hastened environmental review.

"There is a reason why this process has within it the duration required to properly review all the different aspects of a project like this, and to weigh all the different criteria," Carney told reporters.

He said an alternate route had not been mapped out for the pipeline through Nebraska, where environmental concerns are rampant. He said the state of Nebraska needed six to nine months to do its own environmental assessment.

Bill McKibben, who has led protests against the pipeline at the White House, said on Thursday his group 350.org will hold protests against members of Congress who have taken campaign contributions from large oil companies, both in Washington and at their home districts.

"Right now the biggest problem seems not to be the Obama administration, who seem forthright in their promise to reject the pipeline; it's Big Oil and its bought-and-paid-for fleet of congressmen who seem determined to find some way to force approval without review," McKibben said.

REPUBLICANS HAVE CONTINGENCY PLAN

Congressional Republicans have worked to elevate what once was an obscure oil industry issue into an election issue. Republicans signaled this week that they do not plan to drop the Keystone issue, even if Obama rules the project not in the national interest.

Republican Senator John Hoeven is drafting contingency legislation that would see Congress use its constitutional authority for regulating commerce with foreign nations to grant a permit to the pipeline.

Carney declined to comment directly on Republican alternatives. "There's several layers of speculation about legislation that may or may not be written, that may or may not be submitted, that may or may not be voted on," he told reporters.

A spokesman for Senator Lisa Murkowski, the top Republican on the Senate Energy Committee, said she supports exploring contingency plans to advance the pipeline should Obama say no, but wants to make sure a new bill can withstand legal challenges.

A top oil industry lobbyist said he had not seen Hoeven's draft bill and declined to comment on its specifics.

"Obviously Congress is looking at its options, which is probably a good thing for them to do doing," said Marty Durbin, executive vice-president for the American Petroleum Institute, noting he hopes a legal battle over the pipeline can be avoided.

"I think what we need to avoid here is getting into the weeds here on constitutional issues," Durbin told Reuters.

(Additional reporting by Roberta Rampton and Timothy Gardner; editing by Sandra Maler and Mohammad Zargham)

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