The State Department released its initial reassessment of the environmental impact of constructing the Keystone XL pipeline late Friday—and the document quickly enraged environmentalists and seemed to buttress the arguments of pipeline proponents.

Since it’s a draft, the report made no recommendation one way or the other on building the pipeline. But it raised no major environmental concerns with doing so. This is the key paragraph:

Based on information and analysis about the North American crude transport infrastructure (particularly the proven ability of rail to transport substantial quantities of crude oil profitably under current market conditions, and to add capacity relatively rapidly) and the global crude oil market, the draft Supplemental EIS concludes that approval or denial of the proposed Project is unlikely to have a substantial impact on the rate of development in the oil sands, or on the amount of heavy crude oil refined in the Gulf Coast area.

In other words, the State Department believes the Keystone pipeline won’t have any real effect on how much tar sands oil is ultimately refined and brought to market, and thus, that it will have no substantial impact on climate change. Specifically, the report says blocking the pipeline would only lessen emissions by 0.07 to 5.3 million metric tons of carbon dioxide by 2030. For context, in 2010 the United States emitted 6,821.8 million metric tons of carbon dioxide in 2010.

Environmentalists hotly contest this claim, with a considerable amount of data on their side.

There are an estimated 240 gigatons of carbon stored in the tar sands, which is half of what scientists estimate is needed to avert more than 2 degrees of global warming. Releasing it is the equivalent of adding 4 million cars to the road. If you read the State Department report closely they are not really debating that, but rather contending that the oil will be extracted one way or another, so building the pipeline makes no real difference in the end.

This just isn’t true: for one, the industry itself has repeatedly said that building the pipeline would indeed expand tar sand drilling. The State Department asserted in the report that railways could be used to transport the tar sands oil absent any pipelines, but that’s quite debatable: only 0.69 percent of western Canada’s oil moved by rail in 2011 and there’s a continent-wide shortage of rail cars.

Activists blasted this line of reasoning as soon as the draft was released. “The State Department’s environmental assessment is a vehicle for the White House to test the waters to see if the public will buy its false and cynical argument that the Canadian Tar Sands are going to get burned anyway, and so the government’s chief climate scientist’s assertion that Keystone XL will spell ‘game over’ for the climate may be true but is essentially irrelevant,” said Becky Bond, political director at CREDO. “This is a coward’s logic—that we should let the bankers and the oil companies profit while the planet inevitably burns.”

The country’s largest environmental groups also strongly criticized the report. “We’re mystified as to how the State Department can acknowledge the negative effects of the Earth’s dirtiest oil on our climate, but at the same time claim that the proposed pipeline will ‘not likely result in significant adverse environmental effects,’ ” said the Sierra Club’s Michael Brune.

Environmentalists in Congress were up in arms as well. “The draft impact statement appears to be seriously flawed,” said Representative Henry Waxman, ranking member of the House Committee on Energy & Commerce. “We don’t need this dirty oil. To stop climate change and the destructive storms, droughts, floods, and wildfires that we are already experiencing, we should be investing in clean energy, not building a pipeline that will speed the exploitation of Canada’s highly polluting tar sands.”

And just as environmentalists bashed the State Department report, the industry and its backers in Congress cheered it. “No matter how many times KXL is reviewed, the result is the same: no significant environmental impact,” said Marty Durbin, executive vice president for the American Petroleum Institute.

“Today’s report again makes clear there is no reason for this critical pipeline to be blocked one more day,” said House Speaker John Boehner.

The battle is far from over—there is now a forty-five-day public comment period (activists wanted 120 days) and then a final review by Secretary of State John Kerry, followed by a determination of national interest from the White House. But by not flagging any major environmental problems, the State Department is removing a powerful argument from the conversation.

There is one final procedural beef that environmentalists and some reporters have voiced, and that I share: the late-Friday release of a heavily technical and very lengthy report, which Brune likened during a conference call to the actions of the Bush administration.

Literally twenty minutes after the report was posted, State Department officials held a conference call, and literally every reporter on the call had to resort to simply asking the officials what the report said. Each one protested that he or she hadn’t had time to digest the findings. This does not inspire much confidence in the federal process on Keystone going forward—something that could have used bolstering after the repeated conflict-of-interest scandals that have already emerged.