POLITICS
10/11/2011 06:30 EDT | Updated 12/11/2011 05:12 EST

Keystone Pipeline Review Will Be 'Open-Minded': Clinton

WASHINGTON - U.S. Secretary of State Hillary Clinton says her department does not have a pro-pipeline bias as it determines whether to give the green light to TransCanada's proposed Keystone XL project.

"I have no reason to believe" that State Department officials are in favour of the pipeline, Clinton said in an editorial roundtable at The Associated Press on Tuesday.

She added State Department officials have been open-minded throughout the review process. Officials are slated to decide on the fate of the project by the end of the year.

"The department, both here in Washington and in Ottawa, has been very much in 'listen-and-outreach' mode," she said. "They have met with, talked with, received information from a very large group of interested parties; some for, some against."

Clinton acknowledged the issue was an emotional one, with strong opinions on both sides of what has become a fiery debate in the United States about Keystone XL. She also suggested some of the opposition to the pipeline in the six affected states might be politically motivated.

"You have states that are welcoming it, states that are rejecting it, all of whom, I think, are governed by Republicans, or maybe one isn't," she said.

In fact, only one governor has come out in opposition to the $7 billion pipeline, Nebraska Republican Dave Heineman. Congressional Republicans, meantime, are almost uniformly in favour of the project.

Despite the emotions, Clinton said State Department officials have been "extremely careful and thoughtful."

"I have been having our team go forward and do what they are supposed to do," she said.

Damon Moglen of Friends of the Earth scoffed at Clinton's reassurances of impartiality, pointing out that Clinton said last October she was leaning towards granting the permit to TransCanada.

"She made it clear a year ago she was biased," he said.

"The documents released through freedom-of-information requests have proven that not only is she biased, but other senior members of her department have acted with bias and complicity to TransCanada."

Keystone XL has become a political hot potato for the State Department, especially since it released emails last week that suggested a cosy relationship between those working on the file and TransCanada's chief lobbyist, Paul Elliott. Elliott worked on Clinton's unsuccessful presidential bid in 2008.

The New York Times made fresh conflict-of-interest allegations in a weekend piece, reporting that the State Department failed to do an impartial environmental assessment of Keystone XL by hiring an environmental consulting firm, Houston-based Cardno Entrix, recommended to it by TransCanada itself.

A TransCanada official confirmed the company had hired Cardno Entrix for work on other pipeline projects and was among the firms it suggested to the State Department.

But the spokesman also said TransCanada had no say over the State Department's decision to hire Cardno Entrix.

Keystone XL would carry millions of barrels a week of carbon-intensive oilsands crude from northern Alberta to refineries on the Gulf Coast. The pipeline has become a symbol of an increasingly heated debate in the U.S. about the country's reliance on fossil fuels and a perceived reluctance to embrace renewable sources of energy.

The pipeline has become a flashpoint for the environmental movement in the United States following last year's failed federal climate change legislation. Hundreds of people were arrested this summer in protests outside the White House aimed at convincing U.S. President Barack Obama to put the brakes to the pipeline.

The pipeline's opponents argue the project is a disaster waiting to happen as it traverses environmentally fragile areas of the U.S. Midwest, pointing to a series of recent spills along oil pipelines.

Proponents, meantime, say the pipeline will create much-needed jobs and help end American reliance on oil from volatile and sometime hostile OPEC regimes.

Note to readers: This is a corrected story. An earlier story misidentified Friends of the Earth's Damon Moglen.