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More delays seen for Canadian oil sands

March 5, 2013 at 5:53 AM   |   Comments

NEW YORK, March 5 (UPI) -- Projects like TransCanada's Keystone XL oil pipeline face major setbacks if it takes longer than six months to get U.S. support, an analyst said.

The U.S. State Department last week issued a draft environmental impact statement on the $5.3 billion Keystone XL pipeline. The project would deliver 830,000 barrels of tar sands oil per day from Canada to southern U.S. refineries.

The measure advances to a 45-day public comment period. Phil Skolnick, an analyst at Canaccord Genuity Corp., told Bloomberg News the project might face major delays as the price for bottle-necked Canadian crude oil declines.

"If Keystone XL doesn't happen or gets delayed a full year plus, you're talking about projects having to be put on the shelf," he said.

Bloomberg reports that prices for Canadian crude oil are at record lows because producers can't get their oil to U.S. refineries. Plans to get oil sands to foreign markets by western Canadian ports have been meet by opposition from provincial leaders and aboriginal communities.

Nebraskan concerns prompted TransCanada last year to develop a new route for the pipeline to avoid the state's Sand Hills ecosystem. The Nebraska Public Power District has expressed concern over a 2014 deadline to have transmission lines in place.

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