Reports: Obama Will Reject Keystone Pipeline Proposal

Several news outlets are reporting that the Obama administration will reject TransCanada's proposal to run a pipeline across the U.S.-Canada border.

The Washington Post reports the administration will make it official later today and will allow TransCanada to reapply once it has rerouted the pipeline to avoid the environmentally sensitive Sandhills area of Nebraska.

As we've reported, the Keystone XL pipeline has become a rallying point for environmentalists. The president first sought to put off a decision on the pipeline until after the 2012 elections, but he agreed to make a decision by Feb. 21 as part of the payroll tax cut negotiations.

The National Journal reports the State Department, which is reviewing the administration, said "it simply could not adequately review the proposed project in time to meet a 60-day deadline for a decision on the permit imposed by Congress in the payroll-tax package enacted in December."

TransCanada has already said it will reroute its pipeline.

We'll have more on this story as it develops.

Update at 12:13 p.m. ET. Revert To Original Deadline:

The Los Angeles Times reports that it's still unclear whether the Obama administration will reject the pipeline proposal outright or try to stick to the original timeline, which gives the State Department more time to evaluate the proposal.

In his press briefing yesterday, the president's press secretary Jay Carney expressed the administration's displeasure with the rush timeline agreed to during the payroll-tax negotiations.

"We made clear back in December that a political effort to short-circuit that process for ideological reasons would be counterproductive because a proper review that weighed all the important issues in this case could not be achieved in 60 days," Carney said. He added, "It is a fallacy to suggest that the President should sign into law something when there isn't even an alternate route identified in Nebraska."

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