The proposed Keystone XL oil pipeline is unlikely to increase the pace of Canadian oil sands development, a U.S. State Department study said on Friday, raising pressure on President Barack Obama to approve a project environmentalists see as a major climate change problem.

The massive 11-volume environmental impact study released on Friday did not recommend whether President Barack Obama should grant or deny an application by TransCanadaCorp to build the $5.4 billion line, which would transport crude from Alberta’s oil sands to U.S. refineries.

But a State Department official who briefed reporters ahead of the report’s release said that blocking Keystone – or any pipeline – would do little to slow the expansion of Canada’s vast oil patch, maintaining the central finding of the State Department’s preliminary study issued last year.

The report’s publication opened a new and potentially final stage of an approval process that has dragged for more than five years, taking on enormous symbolic political significance, potentially helping define Obama’s legacy.

With another three-month review process ahead and no firm deadline for a decision on the 1,179-mile line, the issue threatens to drag into the 2014 congressional elections in November. Obama is under pressure from several vulnerable Democratic senators who favor the pipeline and face re-election at a time when Democrats are scrambling to hang on to control of the U.S. Senate.

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Jan 31 (Reuters) – A U.S. State Department study on the environmental impact of the Keystone XL oil pipeline will not represent a final decision on whether the United States will allow the project to go forward, White House spokesman Jay Carney said on Friday.

The State Department is expected to release the report soon. There will be a period for public comment and feedback from other government agencies.

CALGARY, Alberta (Reuters) – TransCanada Corp reduced the limits for vapor pressures on its main U.S. oil export pipeline this month, regulatory documents show, one of the clearest signs yet of growing concern over gas-infused crude.

The formal move to tighten technical specifications and mandate improved testing on its 590,000 barrel per day Keystone pipeline had been planned for some time, industry sources said. The change is focused on maintaining quality standards and is not specifically related to any safety issues.

However it comes at a time of intensifying public debate over the potential dangers of transporting certain types of oil following a series of train derailments and explosions involving tank cars carrying light crude oil, including the Lac-Megantic, Quebec, crash that killed 47 people.

While rail companies worry about safety, pipeline companies like TransCanada want to prevent overly gassy crudes from entering their system to avoid shipping the ultra-light components to refiners who have little use for the gas.

The North American oil industry is starting to address the issue of testing for and policing the presence in crude of organic compounds of low molecular weight such as methane, ethane or propane, known in the industry as “light ends.”

Those concerns could become more prevalent as gas-rich shale production expands and diluent-blended Canadian crude output grows.

TransCanada declined to comment on the change, which was detailed in documents filed with the U.S. Federal Energy Regulatory Committee and Canada’s National Energy Board.

Canadian pipeline peer Enbridge Inc is currently analyzing whether to change its vapor pressure testing method, a spokesman said. Kinder Morgan Energy Partners LP declined to comment on possible changes in its tariff.

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U.S. corn exports of 1.8 mln tonnes a marketing year high * Wheat exports most since September, topping expectations * Soybeans bounce after hitting 2-1/2 month low By Michael Hirtzer CHICAGO, Jan.. … full article