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Reports: Keystone XL Rejection Expected

Updated: 2:35 p.m.

The Obama administration is set to announce a rejection of the Keystone XL oil pipeline, according to multiple news reports, setting up a new confrontation with Republicans who contend the project would create as many as 20,000 jobs.

Brendan Buck, spokesman for Speaker John Boehner (R-Ohio), promised the fight to build the pipeline from Canada to the Gulf Coast would continue.

“President Obama is about to destroy tens of thousands of American jobs and sell American energy security to the Chinese,” Buck said. “The president won’t stand up to his political base even to create American jobs. This is not the end of this fight.”

The payroll tax cut extension bill the president signed last month gives the president the authority to reject the pipeline within 60 days if he determines it is not in the national interest. But the administration has repeatedly contended that there is not enough time to review the project and make a determination in that time period, given that a route has not yet been selected through Nebraska. The original Nebraska route was scrapped last year after concerns were raised in that state over the potential damage to groundwater supplies if a spill occurred.

The National Republican Congressional Committee also is targeting House Democrats over the issue, accusing them of “buckling under pressure from their radical base and preparing to send these thousands of jobs from the Keystone XL pipeline project overseas to countries like China instead.”

Democrats and the president have dueling constituencies on opposite sides of the issue. Environmentalists oppose the pipeline because the oil comes from Canadian tar sands and because the pipeline might be built through environmentally sensitive areas of the U.S., but unions back the program because it could create jobs.

White House Press Secretary Jay Carney refused to confirm the rejection of the pipeline at his briefing this afternoon but said an announcement could come later. He also tried to put the onus on Republicans, charging that they tried to score political points by hijacking the normal review process for the Keystone project and noted that there still is not a route through Nebraska.

Carney also contended that Obama has an all-of-the-above energy strategy. “This president’s commitment to expanding domestic oil and gas production is firm,” he said.

Buck reacted on Twitter to that statement, tweeting, “Paging Orwell.”

Sen. Mike Johanns (R-Neb.) took the White House to task for pointing to the lack of a route in Nebraska for not moving forward now with the project.

“The president apparently lacks faith in Nebraska’s ability to select a route,” Johanns said. “By arguing that the Nebraska route could force them to deny the permit, he’s implying Nebraska can’t get it right. … To suggest a few dozen miles of the route in Nebraska — which will be identified by the governor, consistent with the law — affects the overall public interest for more than 1,600 miles of pipeline is laughable and reeks of political gamesmanship.”

The business community also blasted the administration’s decision.

“This political decision offers hard evidence that creating jobs is not a high priority for this administration,” U.S. Chamber of Commerce President and CEO Tom Donohue said in a statement. “The President’s decision sends a strong message to the business community and to investors: keep your money on the sidelines, America is not open for business.”

Environmental groups held back on declaring victory until an official statement is made, but some expressed cautious optimism about the news reports.

“If reports that the Obama administration is rejecting the Keystone XL pipeline are accurate, this will be an iconic victory that demonstrates the growing strength of the climate movement,” said Damon Moglen, climate and energy director for Friends of the Earth. “The Keystone XL fight was David versus Goliath — no one thought we could win. A victory would show that sustained grass-roots pressure aimed at holding the president accountable to the public interest proved more powerful than all the lobbyists the oil industry could muster.”

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