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TransCanada is planning to build a portion of its Keystone XL pipeline, which will extend from Oklahoma to the Texas coast.
The Obama administration supports this particular plan. White House Press Secretary Jay Carney said in a statement: “Moving oil from the Midwest to the world-class, state-of- the-art refineries on the Gulf Coast will modernize our infrastructure, create jobs, and encourage American energy production.”
But, even if the Obama administration stood in opposition to the proposal, the plan could still go through–as it does not require presidential approval. It does not cross a US border.
So, TransCanada will move forward with building the $2.3 billion dollar section of the Keystone XL. TransCanada Corp, which is based in Calgary, plans to start transporting crude frome Cushing, Oklahoma to the US Gulf Coast in around June of 2013. “We remain committed to building this overall project in a timely and efficient manner and to meet demand of shippers,” TransCanada Chief Executive Officer, Russ Girling explained.
Girling also said that “Gulf Coast refineries can then access lower-cost domestic production and avoid paying a premium to foreign oil producers.”
As originally envisioned, Keystone XL would have carried as much as 830,000 barrels of oil a day from Alberta, Canada, and the Bakken Shale formation in North Dakota and Montana along a 1,661-mile (2,673-kilometer) path to Texas refineries. The full $7.6 billion Keystone pipeline needed a permit from the State Department because it crossed the U.S.-Canada border.
As a stand-alone project, the Cushing segment will not need approval from the State Department. The pipeline will help relieve oversupplies that have accumulated in the U.S. Midwest because of a lack of pipeline capacity to carry the oil to refineries on the coast.
The southern pipeline will transport light crude produced in North Dakota, Kansas, Montana, Texas and Oklahoma. Permits will still be required from local and state officials and the US Army Corps of Engineers.