Nebraska to announce decision on pipeline
After nine years, two presidential decisions, multiple lawsuits and environmental protests, TransCanada Corp. will learn today whether it will receive the final state permit needed to build the Keystone XL oil pipeline.
After months of indecision, the company will finally find out if it is able to traverse Nebraska when regulators there give a final thumbs-up or down on whether the project is in the state’s interest. If it’s a yes, the decision could spur new legal action by foes; if no, the company may appeal in the courts. A third option, approval but with an adjusted route, could open further complications.
Meanwhile, a spill in TransCanada’s existing Keystone line in South Dakota on Thursday sparked new attacks by environmentalists, who pointed to the event as something the state could expect if the project is approved. While the officials can’t factor pipeline safety or possible leaks into the decision under state law, it’s an awkward time for a perception problem to crop up.
“The timing of this outage is not very good from TransCanada’s standpoint,” John Auers, executive vice-president at energy consultant Turner Mason & Co. in Dallas, said by telephone. “Theoretically, it should not have an impact in Nebraska. I think TransCanada will handle this spill very well, and get it up and running quickly. It could be a good indication that pipes are safe and they can handle incidents.”
TransCanada tentatively plans to restart the line, which can carry about 600,000 barrels of crude a day from Alberta’s oilsands to the U.S. Midwest, on Thursday, a person familiar with the matter said Friday.
The 1,897-kilometre, $8-billion XL extension now before the Nebraska public service commission is intended to carry crude oil from Hardisty, Alta., through Montana and South Dakota to a Steele City, Neb., junction, where it would connect to pipelines leading to refineries near the Gulf of Mexico.
In Nebraska, the XL project has the support of the state’s governor, Republican Pete Ricketts, its chamber of commerce, trade unions and the petroleum industry.
With a positive ruling from Nebraska in hand, TransCanada would still have to formally decide to proceed with construction on the line. The company’s open season for gauging producers’ interest closed late last month, and TransCanada executives have indicated they’ve secured enough shipping commitments to make the project commercially worthwhile.