WASHINGTON - Canada's ambassador to the U.S. predicts a wild ride ahead in the Keystone XL debate, with this week's presidential veto of a pro-pipeline bill just one more twist in the journey.
"We expect a roller-coaster here and we expect setbacks," Gary Doer said in an interview.
He said lawmakers will probably move on to other issues for a while, then return to Keystone. Congress is in a dispute over immigration rules — which has gotten so bitter that it's prompted a standoff that could throttle funding after this week to the Department of Homeland Security.
Soon, Doer said, there will be more occasions to discuss the long-delayed Alberta-to-Texas pipeline. He said there's already talk in Washington of attaching a pipeline provision to a big infrastructure or budget bill. It could be a lot more difficult for the president to veto that kind of legislation.
"We believe people are going to work towards getting broader proposals," Doer said, adding that he didn't want to wade into a domestic political debate.
A first bill to build the pipeline landed on President Barack Obama's desk this week and he immediately vetoed it. He said it's up to him, not Congress, to make decisions on cross-border pipelines.
Doer also addressed a suggestion laid out in a public letter Wednesday by former New York mayor Michael Bloomberg.
Now a United Nations special envoy on climate change, Bloomberg suggested that Canada and the U.S. strike a bilateral climate deal in conjunction with Keystone XL.
Bloomberg floated the idea in a piece titled, "Keystone Solution Runs Through Canada." He said that pipeline gives the U.S. great leverage to extract climate commitments from Canada and could help the economy while lowering emissions.
Doer saluted the idea of a Canada-U.S. climate arrangement. He said the Canadian government has repeatedly offered to regulate oil and gas with the U.S. the way it did with automobile emissions, black carbon and ozone-depleting pollutants.
But he said that process couldn't be tied to Keystone, for legal reasons. He said Keystone would run into new court challenges should the regulatory process morph into a round of Canada-U.S. deal-making.
"On the issue of having a quid-pro-quo for Keystone — we think that's against the national-interest determination rules," Doer said, referring to the U.S. regulatory process for pipelines.
"It's the national-interest determination — not the international-interest determination... We would have lawyers opposed to this pipeline all over it.
"You can't do it as a deal. It would be legally challenged."
The pro-pipeline side made one more effort to weigh in on the regulatory process Wednesday. It sent the administration a letter challenging some of Obama's recent talking points on Keystone.
The letter from TransCanada Corp. quoted findings from a prominent energy consultant that all crude oil in the pipeline, or most of it, would be refined in the U.S. In addition, 70 per cent of the finished product would stay in the U.S., according to the study by IHS Energy.
Obama has suggested more than once that Keystone would not benefit the U.S. economy and would merely help transport Canadian oil overseas.