On January 18, President Obama announced the Administration’s decision to deny the application for construction of the Keystone XL Pipeline. (For background, see the December 2011 Congressional Digest titled “Keystone Pipeline.”) Republicans in Congress had forced the President’s hand on the issue last year by attaching a provision to the shot-term payroll tax cut extension legislation that required the Administration to make a decision on the pipeline within two months.

In a statement released by the White House, the President said:

“This announcement is not a judgment on the merits of the pipeline, but the arbitrary nature of a deadline that prevented the State Department from gathering the information necessary to approve the project and protect the American people. I’m disappointed that Republicans in Congress forced this decision, but it does not change my Administration’s commitment to American-made energy that creates jobs and reduces our dependence on oil.”

The President further stated that the Administration would look for new ways to work with the oil and gas industry to increase the Nation’s energy security “in a way that benefits American workers and businesses without risking the health and safety of the American people and the environment.”

While environmental groups hailed the Administration’s decision, Republicans in Congress vowed to take legislative action to reverse it. The House Energy and Commerce Subcommittee on Energy and Power has scheduled a hearing on January 25 on a measure that would transfer authority for approving pipelines that cross international boundaries from the State Department (where it now resides) to the Federal Energy Regulatory Commission (FERC). The bill, H.R. 3548, introduced by Representative Lee Terry (NE-R), creates a process whereby FERC would approve the pipeline, including a route modification to be worked out with the State of Nebraska.

“The American people want us to stop buying Venezuelan oil,” Representative Terry said. “The Keystone Pipeline is a key component of making that happen.”

The Subcommittee has invited Secretary of State Hillary Rodham Clinton to testify at the hearing.