Early Saturday morning, the Senate passed the “Temporary Payroll Tax Cut Continuation Act of 2011,” which extends a payroll tax cut and unemployment benefits for two more months—while requiring that the Obama administration make a decision on the Keystone XL pipeline within the same time period.  

In November, President Obama delayed the Keystone decision until at least January 2013, while alternate routes around Nebraska were considered. But this bill requires a decision with sixty days. Here’s a summary of the provision:

Sec. 501 Keystone XL Pipeline Permitting Process (no cost)
Within 60 days, the President, acting through the Secretary of State, is required to grant a permit for the Keystone XL pipeline project application unless he determines the pipeline would not serve the national interest. Any permit issued shall require the reconsideration of routing the pipeline within the State of Nebraska. Any permit granted is deemed to satisfy all the requirements of the National Environmental Policy Act and any modification required by the Secretary to the construction mitigation and reclamation plan shall not require supplementation of the final environmental impact statement.

So this will require Obama to make a final permitting decision by mid-February, while still allowing for a potential reroute around Nebraska, where the Republican governor there has opposed the project.

Obama said at a press conference this month that “any effort to try to tie Keystone to the payroll tax cut, I will reject.” That clearly was an empty threat, since he plans to sign this bill on Monday when the House will presumably approve it. In brief remarks at the White House this morning, Obama lauded passage of the tax relief and did not mention the Keystone provision at all.

So how likely is it that Keystone XL is ultimately approved? It’s hard to tell, since the White House hasn’t said a word, but many environmentalists inside and outside Congress believe this makes a rejection more likely.

“The deal passed by the Senate rushes the pipeline review process, making a credible, science-based review impossible. Because of this, and the great harm we already know the pipeline would cause, President Obama has no choice but to reject the pipeline,” said a statement this morning from Friends of the Earth.

Representatives Henry Waxman and Ed Markey, both stalwart environmentalists, told Politico yesterday before the bill was passed that they weren’t overly concerned.

 “I think it’s shortsighted for the Republicans to force a decision without giving the president enough time to fully consider it,” said Waxman, the ranking member of the Energy and Commerce Committee. “And if they force him to do that, it’d seem to me, the only logical thing for him to do is to say no to it.”

Markey agreed. “We expect the president to still reject the commencement of the construction of the pipeline until there is a full completion of an environmental review,” he said. “The 60-day deadline should not lead to the White House approving the actual construction to begin.”

In that interview, Waxman revealed the only signal from the White House about its intentions that I’m aware of—Waxman held up his BlackBerry and said “The White House has just sent me an e-mail saying, ‘Don’t worry.’ ”

Pipeline opponents surely do have more to worry about today than they did last week—but Keystone XL approval is far from certain.