The White House has at times tried to distance itself from the decision. | REUTERS Why Keystone is still at risk

Things look bleak for greens opposed to the Keystone XL pipeline — but they still have plenty of weapons to thwart or slow the project.

Environmentalists suffered a blow last week when the State Department issued the latest in a series of studies that discounted their warnings that TransCanada’s Alberta-to-Texas pipeline would endanger the Earth’s climate.


Still, Keystone faces at least several more months on its road to a presidential permit. And opponents have options including filing lawsuits, enlisting other agencies’ help or appealing to Secretary of State John Kerry to reject his staff’s work. They could also play the biggest wild card of all — whether President Barack Obama wants the pipeline to live or die.

Even a slowdown could have serious consequences for TransCanada’s hopes to put the pipeline into service by early 2015.

Here’s a look at what happens next:

1. Public comment, hearings and lawsuits

The State Department will submit its draft environmental study to the Federal Register this week, starting a 45-day public comment period before it completes a final version. The department will also hold a public hearing in Nebraska during that period.

Count on environmentalists to pack the hearing and rally supporters to submit thousands of comments. “I don’t think anyone’s going to walk away from this fight,” climate activist Bill McKibben said after last week’s report came out.

But industry leaders aren’t worried.

“I think the State Department has had over four years to do their work,” Alex Pourbaix, TransCanada’s president of energy and oil pipelines, told POLITICO this week. “I’d be pretty surprised to see them about-face over a 45-day period.”

Even if the department sticks to its guns, however, a big response by opponents could build public sentiment against the project. And there’s always a chance of a curve ball emerging to derail the process.

Something similar happened in late 2011, when Nebraska Gov. Dave Heineman raised concerns about the pipeline’s potential risk to the Ogallala Aquifer and the state’s sensitive Sandhills region. Those qualms prompted the State Department to begin a review of a new proposed route, pushing the issue beyond the 2012 elections.

But repeating that feat would be hard now that so many of the objections about the project have been voiced, said Kevin Book, managing director of research at Clearview Energy Partners, an independent research firm.

“Could the environmentalists invoke something? It’s unlikely,” Book said. “But it would have to be something off the radar, which, by definition, means we don’t see it right now.”

Once the final study is out, environmentalists could file lawsuits renewing their arguments that the review process was biased, parts of review were incomplete or the study didn’t properly assess the risk to Nebraska. But that challenge can’t come until at least the final environmental study is released, said Melissa Powers, an energy law associate professor at Lewis & Clark Law School.

Expect separate legal challenges to permits from the Army Corps of Engineers, which must approve any wetlands crossings, as well as challenges to TransCanada’s eminent domain authority, she said.

Additionally, the Nebraska Easement Action Team is working to mobilize residents to require TransCanada to obtain easements for the pipeline, which could gum up the process. Nebraska residents have also sued to challenge the state law that gave Heineman authority to determine the pipeline’s route.

2. Determining the ‘national interest’

After the State Department’s final study comes out, the Environmental Protection Agency and the Departments of Energy, Defense, Interior, Transportation, Homeland Security, Justice and Commerce will have 90 days to weigh in on whether Keystone meets the “national interest.”

EPA raised objections in 2011 to a previous State Department study on Keystone, saying the department failed to examine risks associated with oil spills, greenhouse gases and chemicals, along with effects on low-income and minority communities.

But some observers say that’s unlikely to happen this time.

“I wouldn’t anticipate any strenuous objection from the other Cabinet members,” said Elliot Diringer, executive vice president of the Center for Climate and Energy Solutions and a former policy adviser to the White House Council on Environmental Quality under President Bill Clinton. “We haven’t heard any other strong arguments for why the pipeline shouldn’t be built. And the other factors taken into account — the economic impact and energy security — would seem to weigh in its favor.”

State’s latest study says the pipeline’s construction would support 42,100 direct and indirect jobs during the one- to two-year construction period, which would bring in wages of about $2 billion, plus $3.3 billion in other spending. Supporters also say it would also aid North American energy independence.

“The benefits are still the same,” said Cindy Schild, refining senior manager at the American Petroleum Institute. “We’ve seen the opponents’ points or positions vary a bit. But we’ve been talking about jobs, support for the economy, our trade relationship with Canada, the vastness of the resource and what that provides to the U.S. and the refineries here.”

Nearly five years in, she said, it’s unlikely that any Cabinet departments would have new objections to raise.

“I would certainly hope that by now, especially with the level of attention it has received from policymakers and the president himself, that the agencies would be keen enough to have been doing their due diligence in this process all along,” she said.

3. Kerry weighs in

If the project comes through the “national interest” stage unscathed, it lands in Kerry’s lap. There, greens hope they have an ally, given the ex-senator’s roots as a climate advocate.

But Kerry has offered no hints on which way he’s leaning on Keystone. His first guest as secretary of state, however, was Canadian Foreign Minister John Baird, an invitation that Kerry called a sign of the importance of the U.S. relationship with its northern neighbor.

No matter Kerry’s personal leanings, the consensus of energy analysts and industry officials is that he’ll be at least somewhat bound by his department’s final study, plus any concerns that arise from the national interest determination.

“I think that [the] secretary has to make a decision based on the analysis,” API’s Schild said. “Certainly, [he has] strong support on climate change, and that is a priority. But when you look at how you can really address climate change, this is not it.”

Kerry is “captive to the administrative record,” Book said. But he said Kerry has another factor to consider: “the political will of the president.”

“I’ve got to believe that a political appointee who serves at the president’s behest doesn’t, as his first act in a new office, run counter to the will of the president,” he said.

4. What does Obama want?

Obama has never said whether he supports or opposes Keystone. He speaks frequently about an “all of the above” energy policy and has endorsed Keystone’s southern, Oklahoma-to-Texas portion. But he’s also made climate change one of his premier causes in both his inaugural and State of the Union addressses.

The White House has at times tried to distance itself from the decision.

A 2004 executive order technically gives Kerry the authority to issue Keystone’s permit, with Obama making the final call only if another department objects. White House energy aide Heather Zichal stressed last month that the State Department will do the Keystone review.

But politically, the buck on a decision this big stops with the president.

“This has been and will remain the president’s call and closely managed by the White House,” said Robert McNally, president of the independent energy research firm The Rapidan Group.

He called the latest State Department report a sign that the pipeline is headed for approval.

“If they were going to reject this, there would have been a more equivocal [report] that left more open ground for skeptical agencies to raise environmental or other concerns,” McNally said.

“In my personal view, the president doesn’t have a problem with this [pipeline],” he added. “The environmental community does, and it’s been politicized where the president may not hate it, but I don’t think he loves it either.”

Book agreed it’s unlikely Obama would try to avoid responsibility by claiming Kerry tied his hands. “The it’s-the-other-guy’s-fault story only goes so far,” he said.

On the other hand, McNally said, Obama could “slow walk” the project until it becomes uneconomical.

TransCanada has made one thing clear: After submitting the first presidential permit application in September 2008, it wants Keystone approved soon.

“We are sitting willing, waiting and ready to put all of those Americans to work,” Pourbaix said. “But we can’t do that until we get a decision. If we get a decision early enough this year, we’ll be able to have a meaningful construction period in 2013.”

Andrew Restuccia contributed to this report.