Energy companies, Alberta premier react to U.S. Senate rejection of fast-tracked Keystone XL

WATCH : The U.S. Senate voted for the first time on whether to approve the Keystone XL pipeline, which would transport Alberta oil to the U.S. Gulf Coast. It’s the latest chapter in a political fighter that has dragged on for years. Jackson Proskow  reports. 

CALGARY – Canada’s petroleum producers said the U.S. Senate’s rejection of a proposal to fast-track the controversial Keystone XL pipeline was ‘not unexpected’, but Alberta’s premier voiced disappointment over the decision.

In a statement, Canadian Association of Petroleum Producers (CAPP) vice-president Greg Stringham called the results “unfortunate”.

But he added, “We are encouraged by the vote because the results clearly indicate Keystone XL is supported by Republicans and key Democrats.”

CAPP said it expects the newly constituted Senate will put this issue in front of President Barack Obama again next year.

“While industry recognizes the decision rests with the president, we remain confident the pipeline ultimately will be approved on its merits,” Stringham said.

CAPP said alternative modes of transportation sources like rail and other proposed pipelines and expansions will be used in the short-term.

Pipeline supporters needed 60 votes to win approval for the bill, but it went down to defeat by a margin of 59-41.

Alberta Premier Jim Prentice was watching the vote very closely.

The premier has spoken several times about how important he views this project to Alberta’s prosperity, giving the province better market access for its bitumen.

Prentice said he’s still confident the project will go ahead.

“Obviously this is disappointing. However, bipartisan support in the United States, has never been stronger…In the Senate, we were one vote short today,” Prentice said.  “The threshold of 60, the majority of the Senate, was still in favour.  So I continue to be optimistic.”

Had it passed, U.S. President Barack Obama was widely expected to veto the bill, which was designed to short-circuit the White House’s own environmental review process.

Last week, Obama suggested that Keystone XL would have a negligible positive impact on the U.S. economy, an assertion denied by both TransCanada Corp., the company behind it, and the Canadian government.

With files from The Canadian Press