Obama to veto Keystone XL bill, according to press secretary

The White House on Tuesday threatened to veto the first piece of legislation introduced in the Republican-controlled Senate, a bill approving the much-delayed Keystone XL oil pipeline, in what was expected to be the first of many confrontations over energy and environmental policy.

Hours after supporters of the bipartisan bill, which is sponsored by all 54 Senate Republicans and six Democrats, announced its introduction, the White House said for the first time that President Barack Obama would veto it.

"If this bill passes this Congress, the president wouldn't sign" it, White House spokesman Josh Earnest said Tuesday, saying legislation shouldn't undermine the review process underway at the State Department or circumvent a pending lawsuit in Nebraska over its route.

It's "premature to evaluate the project before something as basic as the route of the pipeline has been determined," he said.

The two main sponsors, Sen. Joe Manchin, D-W.Va., and Sen. John Hoeven, R-N.D., said Tuesday morning they had enough votes to overcome a filibuster of the bill but not a presidential veto. Majority Leader Mitch McConnell, in one of his first acts, moved to put it directly on the Senate calendar. The House is expected to vote and pass a bill approving the $5.4 billion project, which was first proposed in 2008, on Friday.

"The Congress on a bipartisan basis is saying we are approving this project," said Hoeven, the chief Republican sponsor. He said if the president chooses to veto the bill, he would work to attach it to a broader energy package or must-pass spending bills.

Manchin, whose office reached out to the White House earlier in the day, told reporters the veto threat was a surprise that "slapped down" a bipartisan effort before it even got started.

"It's just wrong. It's just not the way you do business," said Manchin, the only Democrat remaining in the West Virginia delegation. "If this is the start of things, it is a sad beginning."

The head of the American Petroleum Institute, Jack Gerrard, said Tuesday after his annual speech on the state of US energy that the president had failed to make a simple decision that would put people to work, but he predicted the pipeline would eventually be approved.

"It doesn't bode well for relationships between the White House and Capitol Hill," Gerrard said of the veto threat.

The bill is identical to one that failed to pass the Senate by a single vote in November, when Democrats were in control and Sen. Mary Landrieu of Louisiana pushed for a vote to save her Senate seat. She lost to Republican Rep. Bill Cassidy, who sponsored the successful House bill approving the pipeline.

But now the odds of passage are much improved with the Republican takeover of the Senate. The bill will also test Republicans' commitment to more open debate. Hoeven and Manchin said they welcomed additions to the bill, which they hoped would increase support.

In a letter to Democrats from their leadership obtained by the AP, Sen. Chuck Schumer of New York and Sen. Debbie Stabenow of Michigan said the Keystone bill was "the first opportunity to demonstrate that we will be united, energetic, and effective in offering amendments that create a clear contrast with the Republican majority."

Among the ideas suggested in the letter were measures to prohibit exporting the oil abroad, to ensure American iron, steel and other goods were used in the pipeline's construction and to match every job created by the pipeline with an investment in clean energy.

In recent months, Obama has been increasingly critical of the project, and has resisted prior efforts to fast-track the process. At his year-end news conference, Obama said the pipeline would benefit Canadian oil companies but would not be a huge benefit to American consumers, who are already seeing low prices at the pump thanks to oil prices, which on Monday dipped to a nearly six-year low and were sharply down again Tuesday.

In addition, the outcome of a Nebraska lawsuit over the pipeline's route through that state is still pending. And a request by Calgary-based TransCanada Corp. to re-approve the portion of the pipeline in South Dakota is also in limbo. On Tuesday, the state's Public Utilities Commission voted against arguments from a handful of Indian tribes and environmental groups that the request should be dismissed. That means final arguments won't be heard until May.

The project would move tar sands oil from Canada 1,179 miles south to Gulf Coast refineries. Supporters say it would create jobs and ease American dependence on Middle East oil. A government environmental impact statement also predicted that a pipeline would result in less damage to the climate than moving the same oil by rail.

Critics argue that the drilling itself is environmentally harmful, and said much of the Canadian crude would be exported with little or no impact on America's drive to reduce oil imports, which have already been greatly reduced because of record U.S. oil production.

In an unexpected twist, Sen. Dick Durbin, D-Ill., objected Tuesday to the Senate energy committee holding a hearing on the bill, prompting the committee to cancel it for Wednesday. A spokesman for Sen. Lisa Murkowski, R-Alaska, who will chair the committee, said it should not slow the bill down.