A federal decision that blocks the Trump Administration's approval of the Keystone XL pipeline, is currently shooting a project that has met a decade of delays due to fever resistance from environmentalists, landowners and Indians.
U.S. District Judge Brian M. Morris ruled Thursday evening that President Trumps 2017 issued a limitation on the extension of the pipeline by
had not considered all effects required by federal law and that the structure could not move until a further environmental assessment has been completed.
The decision means that the pipeline expansion to carry oil from Alberta to Nebraska is sure to meet at least some further delays as the decision is either appealed to a higher court or government officials complete the additional analysis.
A spokesman for TransCanada said that the company is undergoing Thursday's decision and reiterated the company's support for the project.
"We remain committed to building this important energy infrastructure project," said the spokesman.
The US Department, which issued the Presidential Permission and was the second defendant in the case, did not respond to a request for comment.
Keystone XL has already met many legal and political obstacles, and has become a rally for environmentalists who want to retain fossil fuels in the ground. Mr. Trump revived the pipeline after it was blocked by former President Obama, but the project has continued to face challenges.
TransCanada said earlier this year that it has sufficient support from customers to proceed with the project, which is now expected to cost around $ 8 billion and that work can begin next year. But it has not yet taken a final decision to complete the construction.
Chris Cox, a Toronto-based energy analyst with Raymond James Ltd., said the new government could delay the construction by 2020 and possibly put the pipeline into a problem in the next US presidential election, which increases uncertainty.
"Is TransCanada willing to charge $ 8 billion to get another approval from Trump?
If done as planned, Keystone XL would carry up to 830,000 barrels of oil a day, mainly from Canada's oil sands, more than 1
The new verdict by Judge Morris, nominated by Mr. Obama, requires the federal government to update a previous environmental assessment of Keystone XL in 2014 to weigh more additional factors, including the impact of lower oil prices on project viability, its related greenhouse gas emissions and modeling of potential oil spillages that could lead to.
The government department was already in the process of drawing up an additional environmental assessment of the pipeline's potential impact in Nebraska, but that analysis is unlikely to be sufficient, "said Matthew Taylor, an analyst for energy investment bank Tudor Pickering Holt & Co.
If an additional supplementary survey is required, TransCanada is unlikely to be able to move forward with Keystone XL until early 2019, he said and doubted the future of the project.
"At what time does the incremental work stop?" Mr. Taylor said.
Zachary Rogers, an analyst for energy consultant Wood Mackenzie, predicted the project would continue to move forward, but said the delays were a problem for Canadian oil sands manufacturers struggling to move the crude oil to the market. "Although it's definitely a big setback in terms of timing, this is unlikely to be the nail in the chest of Keystone XL," he said.
Canadian pipelines have had a series of setbacks in the past year. TransCanada discontinued its Energy East project last year after the Canadian government said it would expand the scope of an environmental assessment of the pipeline.
bailed out on the planned expansion of the Trans Mountain pipeline between the provinces of Alberta and British Columbia, faced with vowel opposition and several delays. The Canadian government purchased the 4.5 billion Canadian dollar pipeline to ensure construction, only to see an appeal in August that the project was incorrectly approved and must be considered, delayed construction indefinitely.
The lack of pipeline construction has hit Canadian oil producers who are having trouble getting oil to refineries in the United States. Western Canadian Select Crude has been trading in a steep rebate to West Texas Intermediate Crude in the US, mainly due to the manufacturer's inability to bring their oil to market.
The oil price rebound hit a record of $ 51 last month, even though it has retreated as commodity prices have fallen. Heavy Canadian raw was trading for $ 43 a barrel under US reference prices Friday, according to Tudor Pickering Holt.
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