U.S. judge halts construction of Keystone XL oil pipeline

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A federal judge in Montana halted construction of the Keystone XL oil pipeline on Thursday on the grounds that the US government did not complete a full analysis of the environmental impact of the TransCanada project.

Judge Brian Morris, of the US District Court for the District of Montana, said construction could not go ahead until a more thorough review of the impact on the climate, cultural resources and wildlife was conducted.

Morris previously ruled against the State Department in August, saying it was obligated to "analyze new information relevant to the environmental impacts of its decision".

The Keystone XL pipeline permit decision was largely in the hands of the State Department, by virtue of its authority to issue "presidential permits" for cross-border infrastructure projects.

The 1,184-mile (1,900 kilometre) pipeline would begin in Alberta and shuttle as much as 830,000 barrels a day of crude through a half dozen states to terminals on the Gulf Coast.

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Morris said in his decision Thursday the government's analysis didn't fully study the cumulative effects of greenhouse gas emissions, the effects of current oil prices on the pipeline's viability or include updated modelling of potential oil spills.

"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", Doug Hayes, a lawyer for the Sierra Club environmental group, said in a statement as cited by CNBC.

In doing so the administration overturned a ruling by then president Barack Obama in 2015 that denied a permit for the pipeline, largely on environmental grounds, in particular the U.S. contribution to climate change.

After years of legal wrangling, Obama rejected a permit for the pipeline in 2015.

Canadian heavy crude, traded as Western Canada Select, has been selling at a steadily worsening discount compared with Brent oil, the global benchmark, and West Texas Intermediate in the United States.

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While noting that Thursday's ruling does not completely terminate the Keystone project and that the "now ten-year battle is still far from over", Mark Hefflinger of Bold Alliance declared, "Farmers and our Tribal Nation allies in Nebraska, South Dakota, and Montana celebrate today's victory foiling the Trump administration's scheme to rubber-stamp the approval of Keystone XL".

Opposition to the Keystone XL pipeline has centered on climate change concerns, as well as potential damage to endangered species and to local landowners, including native Americans, whose property would be dug up for the pipeline. The U.S. Obama said, was now a "global leader when it comes to taking serious action to fight climate change".

Then came policy shifts in the Trump administration.

The analysis of a cross-border project like this is done by the State Department.

"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", he continued. "That's why we keep winning in the court".

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