The oil industry is pushing hard for Keystone XL project. Environmentalists see president's decision as a litmus test.
WASHINGTON - President Obama's decision on whether to approve the controversial Keystone XL pipeline looms huge now that the election is over, and it could define Obama's legacy on energy and climate change.
The oil industry, which is pushing hard for approval, describes the choice as the president's "first test to the American people."
Environmental groups are promising that thousands of activists will demonstrate against the pipeline on Sunday outside the White House, just the beginning of the efforts that are being planned to sink the project.
Energy analyst Charles Ebinger said he thought two weeks ago that there was little chance Obama would kill the pipeline. But he's increasingly less sure about that.
"It appears major environmental organizations and strong environmental supporters of the president are suggesting this is a litmus test for whether the second Obama administration is with them or against them," said Ebinger, a senior fellow at the Brookings Institution research center in Washington.
Last January, Obama denied a permit for the northern section of the pipeline, saying the route through Nebraska needed more environmental review. That put off his final decision on the 1,700-mile pipeline, which would bring oil from the Alberta oil sands in Canada to U.S. refineries on the Gulf Coast, until after the election.
The Congressional Research Service concluded this year that oil from the sands produces 14 to 20 percent more planet-warming gases than the average oil in U.S. refineries does. It found that approval of the pipeline could be the equivalent of putting up to 4 million more cars on the road.
The figures are disputed, but even a more conservative new assessment by the energy research group IHS CERA found that the oil sands produced 9 percent more greenhouse gases than average.
"This decision has huge implications in terms of what direction we go in as a nation in the near term in addressing climate," said Jim Murphy, senior counsel for the National Wildlife Federation.
Murphy said the decision is coming as extreme weather events such as Hurricane Sandy were focusing attention on climate change.
Obama has given little clue about his intentions. He said last week that, in general, he believes that climate change is real and that there is an obligation to deal with it. But he also talked about jobs.
"Understandably, I think the American people right now have been so focused, and will continue to be focused, on our economy and jobs and growth, that if the message is somehow we're going to ignore jobs and growth simply to address climate change, I don't think anybody is going to go for that. I won't go for that," he said.
The Keystone project is a chance for the president to boost the economy and create jobs, said Marty Durbin, the executive vice president of the American Petroleum Institute, a trade association for the oil and natural-gas industry.