LINCOLN — The long-running battle over the Keystone XL pipeline returned to the Nebraska Supreme Court on Thursday, with attorneys debating whether TransCanada received a valid green light a year ago to build the 36-inch pipeline across the state.
Much of the arguments centered on whether the Nebraska Public Service Commission had the authority to approve an alternative route — characterized by one attorney as a “political compromise” — instead of the route preferred by the Canadian pipeline corporation.
Attorney Dave Domina told the court that TransCanada needs to reapply for a route, delaying the much-delayed project several more months, because the company asked for approval of only one route and not the “mainline alternative route” OK’d by the PSC on a 3-2 vote.
“TransCanada came in riding one horse … and it got no votes for that horse,” Domina told the judges. “It lost.”
Attorneys for the PSC and TransCanada disputed that, saying that the application provided plenty of information about more than one route, and that even some opponents of the Keystone XL told the PSC that the alternative route was superior.
“Any argument that there was no evidence about the mainline alternative route (in the application) is just wrong,” said Omaha attorney Jim Powers, who represents TransCanada.
The seven members of the Supreme Court peppered the lawyers with questions during the 50-minute oral arguments in a packed courtroom. A ruling is not expected for several weeks.
Questions from the judges not only focused on the alternative route decision, but also on a possible technicality that could nullify the PSC’s decision.
Domina argued that TransCanada erred by not first seeking approval for their pipeline route by the governor. He said that the Major Oil Pipeline Siting Act, adopted by the Nebraska Legislature in 2011, allows the PSC to act only after a governor first rejects a route.
“Without a denial (by the governor), the PSC can’t act,” Domina said. That, he said, means that TransCanada needs to start again, from square one, in seeking approval for a pipeline route across the state.
Domina has some history with technicalities winning the day — last year, he won a ruling from the Supreme Court that shut down the notorious beer stores in Whiteclay, Nebraska, pointing out that the beer stores’ lawyer didn’t notify all the parties involved in the case.
But Powers, as well as Assistant Nebraska Attorney General Dave Lopez, disagreed.
Lopez said that state law allowed pipeline companies “two choices,” to either seek approval from a governor or the PSC, a five-member elective board that deals mainly with telecommunications issues and grain warehousing.
“There’s an ‘or’ between gubernatorial approval or going to the Public Service Commission,” he told the judges.
Lopez also said that the PSC possesses the authority to approve an alternative pipeline route if it decides it is in the public interest.
But Domina’s law partner, Brian Jorde, in comments after the oral arguments, pointed out that TransCanada tried to amend its application, to provide more information about the mainline alternative route, after the PSC’s vote last year. Why, he asked, was that necessary if they had applied for approval of more than one route?
Supreme Court Judge Lindsey Miller-Lerman asked the same question during the court hearing. Powers, the TransCanada attorney, said the attempt to amend the application was done only in case the PSC needed more information, and the PSC ruled that it did not.
The lawsuit, filed by dozens of landowners impacted by the pipeline as well as environmental groups and two Indian tribes, is one of the last remaining hurdles for the $8 billion project. It would carry up to 830,000 barrels of crude oil a day from the tar sands region of Alberta to refineries on the U.S. Gulf Coast set up to handle the thicker oil.
But the project, first proposed a decade ago as a stable way to enhance America’s energy supply, has run into a firestorm of opposition from environmentalists across the country, who maintain the extensive processing of tar sands to extract the oil harms the environment. Some Nebraska landowners object that a foreign corporation is being allowed to use eminent domain to obtain right of way.
TransCanada first won approval for a route across Nebraska in 2013, when a path that bypassed the state’s groundwater-rich Sand Hills was OK’d by Gov. Dave Heineman. In 2015, the Supreme Court allowed the state’s pipeline act to stand “by default” in an unusual 4-3 split, but Domina argued Thursday that it was not a binding decision that impacted the current legal challenge.
TransCanada, when it reapplied, sought route approval from the PSC, rather than the governor, reasoning that it would take less time. That led to the PSC’s decision a year ago to OK an alternative route, in part because it paralleled for more miles an existing TransCanada pipeline.
The company has said it plans to begin construction sometime next year, and has already begun moving in pipe and other supplies in South Dakota and Montana.