US Interior approves right-of-way for Keystone XL oil pipeline; court challenges remain

Washington — The US Interior Department on Wednesday authorized Keystone XL pipeline to be built across 44 miles of federal lands in Montana, but court challenges remain before the long-delayed oil sands pipeline can be built.

The approval of a right-of-way grant was part of a record of decision signed by Interior Secretary David Bernhardt on Wednesday. In a statement, Bernhardt called the decision "an important milestone" in construction of the 830,000 b/d pipeline. The 1,200 mile pipeline, intended to move crude from western Canada to the US Gulf Coast, was proposed more than 10 years ago.

Wednesday's decision does not address the majority of the pipeline's proposed path over private lands. The pipeline has been delayed in Montana by a lawsuit challenging the Trump administration's 2019 presidential permit.

In addition, permissions and rights-of-way decisions are still needed from the US Army Corps of Engineers, Department of Energy's Western Area Power Administration, and Department of Agriculture's Rural Utilities Service, Interior said.

Keystone XL is among three delayed pipeline projects slated to move more Alberta oil to market, along with the Canadian government's 590,000 b/d Trans Mountain expansion to British Columbia and Enbridge's 370,000 b/d Line 3 replacement to the US Midwest.

S&P Global Platts Analytics expects at least two of the projects to be completed by the end of 2022.