Canada's PM suggest politics behind pipeline delay

AP News
Posted: Dec 02, 2011 6:10 PM
Canada's PM suggest politics behind pipeline delay

Canadian Prime Minister Stephen Harper strongly suggested Friday that politics was behind the Obama administration's decision to delay a proposed oil pipeline from Canada _ days before his planned visit to the White House.

Harper travels to Washington on Wednesday where he and Obama are expected to announce an agreement to enhance border security and trade. Harper is also expected to urge Obama to approve the Keystone XL pipeline to the Texas Gulf Coast.

"It is not in this country's interests that we are a captive supplier of the United States of energy products, especially when we see some of the politics that are going on south of the border," Harper said.

Harper later said in an interview with Sun Media that he was "disappointed with the politics down there."

Last month, the U.S. State Department decided to delay the project until 2013, after the presidential election, to allow the project's developer to figure out a way around Nebraska's Sandhills, an ecologically sensitive region that supplies water to eight nearby states.

Harper has said he has already made it clear to Obama that Canada will step up its efforts to sell oil to Asia since the decision was delayed, and would keep pushing the U.S. to approve the project.

The pipeline is critical to Canada, which must have infrastructure in place to export its growing oil sands production from northern Alberta. The region has more than 170 billion barrels of proven reserves and daily production of 1.5 million barrels from the oil sands is expected to increase to 3.7 million in 2025. Only Saudi Arabia and Venezuela have more reserves.

The Obama administration's announcement to put off a decision went over badly in Canada, which relies on the U.S. for 97 percent of Canada's energy exports.

Harper said Canada's economic prosperity depends on the growing energy sector and said "diversifying our markets for those products is not just essential to our economic prosperity, but to our economic security."

The Keystone XL pipeline would carry an estimated 700,000 barrels of oil a day, doubling the capacity of an existing pipeline from Canada. The heavily contested project became a political trap for Obama, who risks angering environmental supporters _ and losing re-election contributions from some liberal donors _ if he approves it.

Senate Republicans introduced a bill Wednesday that would require the administration to approve the Keystone XL pipeline within 60 days, unless the president declares the project is not in the national interest.

But the Republican bill has little chance of approval in the Democratic-controlled Senate. The measure illustrates Republicans' belief that Obama is vulnerable on the jobs issue.

Alberta's premier told The Associated Press last month that the U.S. should speed up a decision after the Canadian pipeline developer agreed to shift the route of the planned Canada-to-Texas oil pipeline out of the environmentally sensitive area of Nebraska. Premier Alison Redford said there appears now to be no reason to delay the Keystone XL pipeline.

Andrew MacDougall, Harper's spokesman, said Harper will discuss economic competitiveness, trade and security when he visits the White House. He declined to confirm the border announcement will be made but technical media briefings are scheduled for Wednesday and an announcement has long been expected.

The border measures are expected to include better screening to reduce bottlenecks at the border, the use of new technologies, sharing information among law enforcement agencies and identifying potential threats early.

Canada is the United States' largest trading partner, with more than $1 billion in goods crossing the border every day.

Harper and Obama met last February to announce a broad road map of the initiative, but the agreement is expected to fall short of the larger vision outlined then. Obama has said the free flow of goods and services results in huge economic benefits for both countries.

Harper said Friday "a lot of hours in a lot of levels of government" have been spent hammering out details of the deal since the initiative was announced 10 months ago.

"We're seeking ways of ensuring security in North America while at the same time making sure that we continue strong Canadian access to the American market," Harper said.

"Even with all the problems that exist in the United States, this remains essential to our well being and our future prosperity."