Obama vetoes Canada-US Keystone oil pipeline bill

US President Barack Obama delivers remarks at the American Association of Retired Persons (AARP) headquarters in Washington, DC, Feb 23, 2015, regarding retiremnet security. (AFP/JIM WATSON)

WASHINGTON: Barack Obama issued the most significant veto of his six-year presidency on Tuesday (Feb 24), blocking legislation allowing the Keystone XL oil pipeline to be built between Canada and the United States.

In defying the Republican-controlled Congress, Obama made good on a long-standing veto promise and set the stage for a battle in the 2016 presidential election.

The 1,900-kilometre TransCanada-built pipeline would transport crude from oil sands in energy-rich Alberta province to a network of pipelines that reach across the United States to the shores of the Gulf of Mexico.

Obama says he is not against the project in principle, but accused legislators of trying to "circumvent longstanding and proven processes" for gauging whether Keystone is in the national interest. The bill "has earned my veto," he said.

The pipeline is the subject of several governmental studies, some of which are ongoing. Republicans, who cite a State Department assessment last year that the Keystone project would have minimal environmental impact and create 42,000 construction jobs, accused Obama of hiding behind process and of killing employment opportunities.

"The president's veto of the Keystone jobs bill is a national embarrassment," said House Speaker John Boehner. "The president is just too close to environmental extremists to stand up for America's workers."

Obama may ultimately give his stamp of approval to the project, but as of now his veto stands as a flexing of political muscle and a push back against new-found Republican power as the two parties jockey for position ahead of next year's White House race.

OBAMA 'KEPT HIS WORD'

"President Obama said he'd veto this attack on his executive authority, and he kept his word," Michael Brune, executive director of the conservation group Sierra Club, said in praising the move. "The president has all the evidence he needs to reject Keystone XL now, and we are confident that he will."

Overriding Obama's veto is possible, with a two-thirds majority in the Senate and House of Representatives, but getting enough Democratic support will be a heavy political lift. A Senate aide said the chamber will hold an override vote before Mar 4.

Many critics, mainly Democrats, have warned the project has potential oil spill risks and would actually create very few permanent jobs. Environmentalists say extracting the heavy petroleum from Alberta's oil sands will exacerbate climate change.

Democrats also have broadly denounced provisions which exclude TransCanada from certain fees and taxes as a "giveaway" to a foreign firm.

"Keystone approval would have handed a foreign company a license-to-leak on American soil because it keeps the special favours and exemptions that allow companies that ship or refine tar sands oil to dodge paying into the Oil Spill Liability Trust Fund - leaving American taxpayers to foot the bill in the event of a spill," top House Democrat Nancy Pelosi said.

Canada's Minister of Natural Resources, Greg Rickford, said he still believed the pipeline would be built. "This is not a debate between Canada and the US. It's a debate between the president and the American people, who are supportive of the project," Rickford said. "It is not a question of if this project will be approved - it is a matter of when."

TransCanada vowed to keep fighting to get Keystone XL over the line. "Keystone XL is in the national interest of the United States and should be approved and constructed," the firm said in a statement.