US senators want more study of Canada oil pipeline

Fri Jul 15, 2011 9:40pm GMT

* Recent leaks show need to examine safety of Keystone XL

* Enviro groups argue oil sands more corrosive to pipes

* State should study alternative routes for Keystone

By Ayesha Rascoe

WASHINGTON, July 15 (Reuters) - The U.S. State Department needs to study what corrosive effects Canadian oil sands crude may have on pipelines before the department decides on a $7 billion project that would transport the heavy crude to the Gulf coast, a group of senators said on Friday.

More than half a dozen Democrats said they remain concerned about TransCanada's (TRP.TO: Quote) proposed Keystone XL pipeline, which requires State Department approval because it crosses the Canada-U.S. border.

The planned 700,000 barrel-per-day pipeline has run into fierce opposition from green groups and land owners along the proposed routes.

The senators said recent leaks from Exxon Mobil's (XOM.N: Quote) Silvertip oil pipeline and TransCanada's existing Keystone pipeline underscore the need for a "careful assessment" of spill risks and the route of the Keystone XL.

"We believe several remaining questions must be addressed before the permitting process can proceed," the Senators said in a letter to the State Department.   Continued...

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