Keystone XL pipeline fate in balance as Nebraska opens hearings

Environment


LINCOLN, Neb. (Reuters) – Nebraska regulators opened a final hearing on TransCanada Corp’s (TRP.TO) proposed Keystone XL pipeline on Monday, a week-long proceeding that marks the last big hurdle for the long-delayed project after President Donald Trump approved it in March.

The proposed 1,179-mile (1,897-km) pipeline linking Canada’s Alberta oil sands to U.S. refineries has been a lightning rod of controversy for nearly a decade, pitting environmentalists worried about spills and global warming against business advocates who say the project will lower fuel prices, shore up national security and bring jobs.

Trump’s administration handed TransCanada a federal permit for the pipeline in March, reversing a decision by former President Barack Obama to reject the project on environmental grounds. But the line still needs a nod from regulators in Nebraska – which would be the last of three states to approve its proposed path into the heartland.

A lawyer for opponents of the line opened the hearing in front of the five-member Nebraska Public Service Commission on Monday morning by grilling an executive for the Canadian company about how the pipeline will be disposed of after its anticipated 50-year lifetime.

“Do we have to clean up TransCanada’s abandoned pipeline?” attorney David Domina asked TransCanada executive Tony Palmer.

On Sunday, hundreds of pipeline opponents, including members or Indian tribes, marched through downtown Lincoln under police escort, following a rally at the Nebraska Capitol.

FILE PHOTO – A TransCanada Keystone Pipeline pump station operates outside Steele City, Nebraska, U.S. on March 10, 2014.Lane Hickenbottom/File Photo

Nebraska’s Public Service Commission is meant to weigh whether the project is in the state’s public interest, and will announce a decision by November. The arguments of opponents are constrained by the rules of the commission, however: the commission is not permitted to consider the risk of spills because the route already has an environmental permit.

Opponents – including scores of landowners on the proposed route – will instead argue the jobs are temporary and the risks of the pipeline to local industries like cattle ranching too great. They will also note that if the commission approves the line, TransCanada could seek to seize property along the route using eminent domain law – a politically unpalatable option in the conservative state.

Proponents, meanwhile, will argue the project will bring in hundreds of jobs and millions of dollars in revenue.

Trump has said the project would create 28,000 jobs nationwide, but a 2014 State Department study predicted just 3,900 construction jobs and 35 permanent jobs.

The 830,000 barrel-per-day Keystone XL would link Alberta to an existing pipeline network feeding U.S. refineries and ports along the Gulf of Mexico.

The project could be a boon for Canada, which has struggled to bring its reserves to market. But demand for the line has declined since it was first proposed, due to surging U.S. production, lower prices, and other Canadian pipeline projects.

Additional reporting by Valerie Volcovici in Washington, and Ethan Lou in Calgary; Writing by Richard Valdmanis; Editing by Lisa Shumaker and Matthew Lewis



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