NORFOLK, Neb. — The speaker of the Nebraska Legislature will return to the lawbooks to consider the state's options after the developer of the controversial Keystone XL pipeline on Tuesday again delivered an emphatic “no” to pleas to reroute the project.
TransCanada Inc. officials said, however, that they would consider additional safety measures for the pipeline, which would carry partially refined crude oil from Canada's oil sands area through the groundwater-rich Sand Hills of Nebraska, on the way to the Gulf of Mexico.
The comments came after a nearly 4½-hour meeting involving several TransCanada officials and four key state senators in the private law office of State Sen. Mike Flood, speaker of the Legislature.
Lawmakers are considering holding a special legislative session this fall to force a change in the route. That's a move favored by the state's two U.S. senators, one congressman and Gov. Dave Heineman, as well as a growing number of state senators.
Four of those lawmakers spent more than half of Tuesday's meeting urging a route change to alleviate fears that a leak could foul groundwater.
But Alex Pourbaix, TransCanada's president for energy and oil pipelines, said changing the route would require at least a two-year delay for a federal environmental review.
Such a delay, Pourbaix said, would be unacceptable for the Texas oil refineries that would be customers for the 700,000 barrels of diluted tar-sand oil — called bitumen — from Canada.
Customers such as the Conoco, Shell and Valero oil companies are losing supplies of heavy crude oil from their traditional sources in Mexico and Venezuela and are relying on the pipeline — to be completed in 2013 — to fill that gap, Pourbaix said.
“Our customers need a solution for supply,” he said. “They can't wait another two or three years.”
The current route, Pourbaix said, has already gone through a three-year federal environmental review, which concluded that the environmental impact would be minimal.
Flood said the meeting moved senators no closer or farther from supporting a special session. He said he personally needed to further research the “legal minefield” over whether Nebraska has legal authority to force a route change so late in the process.
The U.S. Department of State has said it will decide by the end of the year whether to give a federal permit for the XL pipeline.
Some senators have said Nebraska needs to act before then if it hopes to reroute the pipeline. Flood, Heineman and others have voiced concern that a last-minute law change could leave the state open to an expensive, and losing, court battle.
The state senators who attended Tuesday's meeting — Flood, Chris Langemeier of Schuyler, Annette Dubas of Fullerton and Kate Sullivan of Cedar Rapids — all urged a new route. In addition, all four expressed interest in making sure Nebraska had legal standing to force a change in the route.
Pourbaix said it probably would have been appropriate for Nebraska to pass routing requirements a couple of years ago. But he said that doing so now would force the company through a state environmental review that would duplicate what federal reviews have already accomplished.
Pourbaix said he planned to report back to senators in the next two to four days what extra precautions the company could take to address concerns and improve Nebraskans' “comfort level” with the project.
For instance, he said, emergency response workers could be situated nearer to the Sand Hills to speed response to leaks in that sparsely settled ranching area.
Most response workers, Pourbaix said, are now expected to be clustered in the Omaha area, about a four-hour drive from the Sand Hills section of the pipeline.
TransCanada officials also said they would address safety concerns about a pipeline pumping station to be built in a wetlands area south of Stuart, Neb., and consider posting a bond to ensure that there would be money for cleaning up spills.
The project's federal review has said small leaks could go undetected for days — until a landowner spots them or until they are discovered in flyovers every two weeks.
One University of Nebraska professor, John Stansbury, has said that would leave the Sand Hills vulnerable to a catastrophic oil spill, an opinion contested by TransCanada officials.
Flood said that if the pipeline route cannot be changed, then he wants “every possible, legitimate thing” done to ensure that leaks are addressed quickly and that every safety step is taken.
TransCanada officials repeated Tuesday that they are taking 57 additional safety precautions that will make the 36-inch, high-pressure pipeline the “safest ever built.”
Robert Jones, a TransCanada vice president, said during the meeting that rerouting the pipeline would be unfeasible and would force the oil to go to other countries, raising U.S. gasoline prices.
That assessment has been disputed by opponents of the project, who say gas prices could rise 20 cents per gallon in the Midwest if the pipeline is built. They point to Trans-Canada's 2008 federal permit application. It stated that the XL pipeline would allow Canadian crude to bypass oversupplied Midwest refineries where the oil is now sold at a discount. The company estimated that Canadian producers could see upwards of $2 billion per year in increased profits by 2013 by shipping oil to the Gulf Coast, where it will command a higher price.
A half-dozen opponents who protested outside Flood's office during the meeting expressed disappointment afterward.
Cindy Myers, a nurse who lives south of Stuart, Neb., near the proposed pipeline route, said TransCanada's refusal to consider a route change once again shows the company's “arrogance” toward Nebraskans.
“They don't care about the people here,” she said, but about making money.
Terry Frisch, an Atkinson, Neb., rancher, added he doesn't think it's right that a foreign company can force Nebraskans to lease land for the pipeline “and tell us what we can and can't do with our water.”
Kent Warneke of the Norfolk Daily News contributed to this report.
Contact the writer:
402-473-9584, paul.hammel@owh.com
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