Future of Keystone XL pipeline becomes more muddled after PSC denies revisions

December 22, 2017 GMT

LINCOLN — The future of the Keystone XL pipeline became even more muddled Tuesday with further delays expected.

The Nebraska Public Service Commission unanimously rejected TransCanada’s request to amend its application for a route across Nebraska. TransCanada said it would “take some time” before considering whether to build the $8 billion project.

The company gave no timeline for such a decision, after earlier stating that it would decide this month whether the long-delayed Keystone XL was financially viable or not.

While a TransCanada spokeswoman said the project remains “viable,” opponents of the pipeline claimed victory, saying Tuesday’s decision by the Nebraska Public Service Commission added more uncertainty, and likely more delay and expense, to the project.

“They ought to take the hint and withdraw their application (for a route),” said attorney Ken Winston, who represents the Sierra Club.

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Brian Jorde, a lawyer who represents dozens of landowners opposed to the pipeline, called Tuesday’s decision “the absolutely worst decision possible for TransCanada and the best possible outcome for landowners.”

On a 5-0 vote, the Nebraska Public Service Commission on Tuesday denied motions made by both TransCanada and the Sierra Club to clarify exactly what the commission granted the Canadian pipeline firm last month.

That’s when the PSC narrowly approved a route for the controversial pipeline across Nebraska. However, the route approved was not the “preferred route” sought by Trans­Canada, but a “mainline alternative route,” which parallels, for more miles, the route of an existing pipeline.

TransCanada asked the PSC to reconsider its approval and allow the company to amend its application to address questions and prevent litigation and delays over the new route.

But the PSC on Tuesday rejected that request, as well as a request by the Sierra Club to nullify the approval of the alternative route.

So where exactly that leaves the project is unclear. Trans­Canada could push forward with its alternative route but face a deluge of lawsuits from landowners who weren’t notified that they might be on a pipeline path.

Or TransCanada could appeal the PSC’s decision with the Nebraska Court of Appeals, which could take up to a year.

TransCanada spokeswoman Robynn Tysver said the company is “going to take some time to review today’s decision and determine our next step.”

“Keystone XL remains a viable project with strong commercial support and we remain committed to this project,” she said.

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But Omaha attorney Dave Domina, who also represents anti-pipeline landowners, said TransCanada is now holding “a fistful of feathers.”

“They’re in a mess,” Domina said.

He said TransCanada must decide whether to move forward with what he considers a legally flawed route across Nebraska, or appeal to the State Appeals Court, which might require the company to reapply for approval of the alternative route. That process, in total, might take three years or more, Domina said.

Parties now have 30 days to file an appeal with the Nebraska Court of Appeals.

The Keystone XL is a 36-inch-diameter pipeline designed to carry thick, crude oil from Canada’s tar sand region to oil refineries on the U.S. Gulf Coast.

While the southern portion of the project was completed years ago, construction of the portion from Alberta to Steele City, Nebraska, was blocked by then-President Barack Obama as damaging to the environment.

After President Donald Trump took office, he resurrected the project, but the Keystone XL still needed to gain permission for a pipeline route across Nebraska.

TransCanada asked for approval of a 275-mile route that had won an OK from the Nebraska Department of Environmental Quality back in 2013.

But the PSC last month rejected that route, and instead approved an alternative route. The agency ruled that it was in the public interest that two pipelines be laid side-by-side, as much as possible, to make it easier to monitor them and react to any problems.

paul.hammel@owh.com, 402-473-9584