Obama rejects trans-America gas pipeline

The pipeline was rejected by the US President, citing concerns the project would have on climate

Ahead of the Paris Climate Summit later this month, President Barack Obama has rejected a trans- America - crisscrossing Canada and the US - gas pipeline, citing concerns the project would have on climate.

Making a sudden announcement at the White House, Obama said it is his administration's analysis that the project "would not make a meaningful, long-term contribution to our economy."

"America is now a global leader when it comes to taking serious action to fight climate change, and, frankly, approving this project would have undercut that global leadership," said Obama, who was flanked by Secretary of State John Kerry and Vice President Joe Biden.

However, lawmakers and opponents to this decision feel that such a US move would only help Canada to export its natural gas to countries like China and India and even Europe through other means.

Obama's decision would immediately have some impact on Indian steel industry. About 10% of the steel pipe to be used in this $7.6 billion pipeline - which was to be laid down by TransCanada Corporation - was to come from India.

Welspun from India had contract to manufacture 10% of the pipeline involving 69,457 tonnes of steel.

If approved, the Keystone gas pipeline would have shipped crude from Alberta's oil sands to the refineries in Texas.

In fact, TransCanada, which was behind the Keystone gas pipeline, has already an application pending, build the Energy East Pipeline, which aims to ship 1.1 million barrels crude a day from Alberta to Quebec and New Brunswick to export oil to Europe and India.

"The project aims to ship 1.1 million barrels of Alberta crude a day across six provinces and 4,600 kilometres. The idea is to supply crude to import-dependent eastern refineries as well as export landlocked Alberta oil to Europe and India," local Black Burn news reported.

"Energy East would repurpose existing natural gas pipe for about two thirds of the way and build new pipe through Quebec and New Brunswick," it said.

In a statement, Republican presidential candidate Lindsay Graham warned that now that the US has decided against this project, Canadian gas and oil would end up in China.

"It's buying oil from a friend, not an enemy. If we don't buy the oil from Canada, they will sell it to China. This is not an environmental issue. This is an issue of radical environmentalists taking over the White House destroying economic opportunity and energy independence for North America," he said.

However, Nevada Senator Harry Reid said Obama made the right decision by rejecting the Keystone tar sands pipeline.

"As I've long said, the Keystone Pipeline is nothing but a favor to special interests who seek to let a Canadian company ship foreign oil to China," he said.