(Recasts; adds quotes from Shell CEO Ben van Beurden)
By Mike De Souza
FORT SASKATCHEWAN, Alberta, Nov 6 (Reuters) - The U.S.rejection of the proposed Keystone XL pipeline was driven inpart by protesters who are increasingly frustrated with inactionon climate change, Royal Dutch Shell Plc ChiefExecutive Ben van Beurden said on Friday.
Speaking at the launch of Shell's new carbon capture andstorage project in Alberta, the first Canadian project of itskind in the oil sands industry, van Beurden saidanti-fossil-fuel movements are growing because of anxiety andresentment about a failure to reduce greenhouse gas emissions.
"If you look back to the last 10, 15 years, you could arguethat progress has actually been disappointing," van Beurdensaid.
This is why some are taking "extreme" positions to stoppipelines, to divest from fossil fuels, to advocate for leavingit in the ground or to demonize the industry, he said.
Oil sands, large deposits of crude in the Western Canadianprovince of Alberta, are often criticized by environmentalgroups because of energy-intensive production that makes theindustry the fastest-growing Canadian source of greenhouse gasemissions. Many environmentalists pointed to the oil sandsindustry's environmental footprint to argue against Keystone XL.
But Shell, which recently halted its Carmon Creek oil sandsproject in part because of a lack of pipeline export capacity,said it has known the future of TransCanada Corp's Keystone XL was uncertain.
Keystone has been in an "uncertainty window" for seven yearswhile it has been under review by the United States, LorraineMitchelmore, president of Shell's Canadian unit, told reporters.
She added that there are at least three other possiblepipeline alternatives to the Keystone project, which wasrejected by U.S. President Barack Obama, and Shell would like tosee at least one approved.
The Alberta government has introduced carbon pricingpolicies to address rising emissions. But van Beurden said hiscompany would like to see broader and stronger carbon pricingmechanisms adopted around the world in a way that will encouragenew solutions.
The C$1.3 billion ($978 million) project launched on Friday,heavily subsidized by the Canadian and Alberta governments, cancapture a third of emissions from Shell's Scotford upgrader,sending it through 65 km of pipeline into saline aquifers forstorage 2 km underground. The upgrader converts bitumen from twooil sands mines into synthetic crude oil. ($1 = 1.3291 Canadian dollars) (Reporting by Mike De Souza in Calgary; Editing by ChizuNomiyama and James Dalgleish)