If there were no environmental problems with Canadian oil sands production, approving the Keystone XL extension pipeline would be, in the words of one observer, a no-brainer.

But there are environmental problems with the oil sands. For one, full life cycle greenhouse gas (GHG) emissions are greater for a barrel of oil-sands derived crude than for traditional forms such as those pumped out of Saudi Arabia. And it’s hard to shake images of stripped-bare land and dead Canadian geese. That’s not to mention the enormous amounts of water consumed.

Environmental concerns and the potential external costs attending to exploitation of natural resources are important considerations. But this is not a one-sided question, nor is the issue of long-term environmental impact as cut-and-dried as some would have you believe. First, a legitimate challenge to the common perception was raised in June 2009 by engineering firm Jacobs Consultancy.

Jacobs’ study, “Life Cycle Assessment Comparison for North American and Imported Crudes,” found that life cycle GHG emissions for oil sands are comparable to domestic and imported conventional crude oils. That’s just taking a deeper look at one side of the debate. The potential economic benefits that could accrue from this little bit of infrastructure improvement also have to be weighed.

According to TransCanada Corp (TSX: TRP, NYSE: TRP), which has already spent USD5 billion developing the Keystone complex and would like to kick another USD7 billion down to extend it, approval would “create more than 15,000 high-wage manufacturing jobs and construction jobs in 2011-2012 across the US.” And a report by economic and financial analysis firm The Perryman Group concluded that Keystone XL could add USD9.6 billion to US gross domestic product. The project would also produce substantial new tax revenues for local, state and federal governments, at a time when “fiscal responsibility” is the momentary song of the land.

This is a bipartisan issue. Although he’ll never get any kind of credit for it, President Obama has, if not emphatically in public certainly without reservation in private, to Prime Minister Stephen Harper, put his support behind the project. Secretary of State Hilary Clinton still has authority to act and will do so unless and until the Environmental Protection Agency (EPA) lodges still another objection to a State Dept environmental review of the project. She favors it.

It’s hard to find a Republicans who doesn’t live around the Keystone XL footprint who wouldn’t vote in favor of the project were it a matter before the legislature. Even the GOPers in opposition, including Sen. Mike Johanns of Nebraska, like the idea of a pipeline connecting oil sands and Montana crude to Gulf Coast refineries. If the XL extension followed the existing Keystone footprint–thus avoiding significant impingement on the Ogallala Aquifer, a significant source of water in the Midwest–work would likely already be underway.

Keystone XL: Meet the New Report, Same as the Old Report

Last week the State Dept, fulfilling an obligation created when the EPA objected to its initial environmental study because it wasn’t thorough enough, released its follow-up report. State went back and re-did its homework. And came to the same conclusion: The proposed pipeline poses limited environmental risk to the area in its footprint.

Release of the Supplemental Draft Environmental Impact Study triggered a 45-day public comment period. That’s down to 38. According to the official website, “Following issuance of a Final EIS, the State Department will solicit public comment and host a public meeting in Washington, DC, before it makes a determination under Executive Order 13337 on whether issuance of this permit is in the US national interest.”

We’re told to expect a decision before the end of 2011.

The problem is nobody’s playing politics when it comes to their own backyard, and nobody wants to put pipelines back there, either. Fifty members of Congress wrote to the State Dept last year, urging rejection of TransCanada’s application to extend the Keystone system. Their reasoning is based on the conclusion that crude derived from the Canadian oil sands results in more carbon dioxide in the atmosphere than what comes from conventional production. This, as even the State Dept concludes, is substantially true. There’s room for reasoning with the NIMBY folks, but there are plenty of knee-jerk reactionaries among the signatories to the letter who won’t support anything that furthers reliance on oil, as a matter of principle.

These minds are hardly likely to be swayed by Jacobs Consultancy, the State Dept, or even a 438-page Royal Society of Canada report, which, after it sent seven academics from a variety of disciplines to examine the issues, found claims about the horrifying impacts of Canadian oil sands development wanting. Minds aware of the dire consequences of transitioning to an economy where cheap energy is not plentiful will find their conclusions illuminating.

“Based on our review of the publicly accessible evidence, a claim of such global magnitude is not accurate,” the RSC panel concluded. “This depiction is clearly aided by the photographs of ugly surface-mined landscapes, but the claims of global supremacy for oil sands environmental impacts do not accord with any credible quantitative evidence of environmental damage.”

Here’s the alternative these 50 members of Congress will have us enjoy: Continuing reliance on Hugo Chavez, whose feelings about the US are well known, and Venezuela; on Saudi Arabia, where regional political upheaval may not threaten directly but certainly makes nervous the regime, and where, according to at least one observer, crude production has strangely declined in recent weeks; Nigeria, where every election seems to bring new violence; and Iraq, where, despite recent successes in bringing production back to near normal levels, fields are irreparably damaged after years of abuse.

Given the significant economic benefits that are likely to come, it’s prudent to build the Keystone XL extension.

The Roundup

We’re breaking away early today to get going on Good Friday, so we’re even more brief than usual here. Enjoy your Holiday weekend.

Here’s an updated list of Canadian Edge Portfolio Holdings’ first-quarter earnings announcement dates.

Aggressive Holdings

• Acadian Timber Corp (TSX: ADN, OTC: ACAZF)–May 2 (confirmed)
• Ag Growth International (TSX: AFN, OTC: AGGZF)–May 13 (estimate)
• ARC Resources Ltd (TSX: ARX, OTC: AETUF)–May 5 (estimate)
• Chemtrade Logistics Income Fund (TSX: CHE-U, OTC: CGIFF)–May 10 (estimate)
• Daylight Energy Ltd (TSX: DAY, OTC: DAYYF)–May 6 (estimate)
• EnerCare Inc (TSX: ECI, OTC: CSUWF)–Apr. 29 (estimate)
• Enerplus Corp (TSX: ERF, NYSE: ERF)–May 13 (confirmed)
• Newalta Corp (TSX: NAL, OTC: NWLTF)–May 10 (estimate)
• Parkland Fuel Corp (TSX: PKI, OTC: PKIUF)–Apr. 29 (estimate)
• Penn West Petroleum Ltd (TSX: PWT, NYSE: PWE)–May 5 (confirmed)
• Perpetual Energy (TSX: PMT, OTC: PMGYF)–May 10 (estimate)
• Peyto Exploration & Development Corp (TSX: PEY, OTC: PEYUF)–May 12 (estimate)
• PHX Energy Services Corp (TSX: PHX, OTC: PHXHF)–May 6 (estimate)
• Provident Energy Ltd (TSX: PVE, NYSE: PVX)–May 5 (estimate)
• Vermillion Energy Inc (TSX: VET, OTC: VEMTF)–May 6 (estimate)
• Yellow Media Inc (TSX: YLO, OTC: YLWPF)–May 5 (tentative)

Conservative Holdings

• AltaGas Ltd (TSX: ALA, OTC: ATGFF)–May 5 (confirmed)
• Artis REIT (TSX: AX-U, OTC: ARESF)–May 12 (estimate)
• Atlantic Power Corp (TSX: ATP, NYSE: AT)–May 11 (confirmed)
• Bird Construction Inc (TSX: BDT, OTC: BIRDF)–May 10 (estimate)
• Brookfield Renewable Power Fund (TSX: BRC-U, OTC: BRPFF)–May 12 (confirmed)
• Canadian Apartment Properties REIT (TSX: CAR-U, OTC: CDPYF)–May 9 (confirmed)
• Capstone Infrastructure Corp/Macquarie Infrastructure Corp (TSX: CSE, OTC: MCQPF)–May 11 (estimate)
• Cineplex Inc (TSX: CGX, OTC: CPXGF)–May 12 (confirmed)
• CML Healthcare Inc (TSX: CLC, OTC: CMHIF)–May 5 (estimate)
• Colabor Group (TSX: GCL, OTC: COLFF)–Apr. 28 (estimate)
• Davis + Henderson Income Corp (TSX: DH, OTC: DHIFF)–May 10 (confirmed)
• Extendicare REIT (TSX: EXE-U, OTC: EXETF)–May 6 (estimate)
• IBI Group Inc (TSX: IBG, OTC: IBIBF)–May 6 (estimate)
• Innergex Renewable Energy (TSX: INE, OTC: INGXF)–May 10 (estimate)
• Just Energy Group Inc (TSX: JE, OTC: JSTEF)–May 20 (estimate)
• Keyera Corp (TSX: KEY, OTC: KEYUF)–May 10 (confirmed)
• Northern Property REIT (TSX: NPR-U, OTC: NPRUF)–Jun. 14 (confirmed)
• Pembina Pipeline Corp (TSX: PPL, OTC: PBNPF)–May 6 (estimate)
• RioCan REIT (TSX: REI-U, OTC: RIOCF)–May 19 (confirmed)
• TransForce (TSX: TFI, OTC: TFIFF)–May 17 (confirmed)