TransCanada asks US to pause KeystoneXL review

OREANDA-NEWS. November 05, 2015. Canadian pipeline giant TransCanada has asked the US State Department to pause its review of the proposed 830,000 b/d Keystone XL oil pipeline while Nebraska officials review it.

The request for delay while the Nebraska Public Service Commission (PSC) reviews the pipeline route through that state could take seven to 12 months, the company said.

"I note that when the status of the Nebraska pipeline route was challenged last year, the State Department found it appropriate to suspend its review until that dispute was resolved," TransCanada chief executive Russ Girling said. "We feel under the current circumstances a similar suspension would be appropriate."

Since the Keystone XL pipeline would cross the US-Canadian border, the State Department has been evaluating whether construction of the controversial pipeline would be in the US' national interest. Opposition from environmental groups on both sides of the border has made what would typically be routine review into a seven-year process for the \\$8bn pipeline to transport crude from Canada's oil sands and the Bakken formation to Nebraska. The pipeline would then link up with an existing pipeline network to feed oil sands crude to refineries along the US Gulf coast.

The Obama administration is widely expected to reject the pipeline project, so the delay would make it more likely a new administration would reconsider after the 2016 presidential election.

Nebraska's legislature in 2012 approved a statute allowing TransCanada to bypass the PSC and have then-governor Dave Heineman make a decision about the pipeline route. Heineman approved the route, but landowners then filed suit challenging the constitutionality of the law. The state supreme court eventually ruled the law was constitutional. But landowners then filed suit challenging TransCanada's right to use eminent domain to devise a route for the project. Fearing that legal case would end up back at the state supreme court, TransCanada decided that seeking approval through the PSC might prove more expedient.