Indiana environmentalists wary of oil pipeline plan

The oil industry says a new oil pipeline from Canada to the Gulf Coast might create jobs for Indiana residents if the Obama administration approves its construction. But Indiana environmentalists say the state should focus on modernizing its auto industry to make clean cars instead.

American Petroleum Institute President Jack Gerard told a crowd in Indianapolis Tuesday that the $7 billion Keystone XL pipeline would create new work for more than 100 Indiana companies. He did not specify which companies.

If built, the 1,700-mile pipeline planned by Calgary-based TransCanada would travel through Montana, South Dakota, Nebraska, Kansas and Oklahoma before reaching refineries in Houston and Port Arthur, Texas.

Supporters say the line, which would carry an estimated 700,000 barrels of oil a day, could significantly reduce U.S. dependence on Middle Eastern oil.

"We've made the case that you have the option of getting oil from Canada or from a petro-dictator in another country. To us it's a pretty straightforward equation," said Canadian Ambassador to the U.S. Gary Doer, who attended Tuesday's conference on energy jobs.

But opponents say it would bring "dirty oil" that requires huge amounts of energy to extract and could cause an ecological disaster in case of a spill.

Hoosier Environmental Council Executive Director Jesse Kharbanda said Indiana should keep its focus on industries more tied to the state.

"An approach that puts more of an emphasis on modernizing the automobile sector would be extremely beneficial to a manufacturing state like Indiana," Kharbanda said.

The pipeline project has been in the planning and review stage for years and has become a flashpoint for President Barack Obama's energy policies. The U.S. State Department, which has authority over the pipeline because it crosses an international boundary, is expected to make a decision on the project by year's end.