Nebraskans Prepare for More Keystone XL Controversy, Despite New Pipeline Laws

Concern is growing that new legislation won't protect landowners outside the Sandhills, who may be impacted by a rerouted pipeline.

The Nebraska capitol building in Lincoln.
The Nebraska capitol building in Lincoln. Credit: Karin Dalziel, flickr.

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A week after a Canadian company agreed to reroute the Keystone XL oil pipeline out of the fragile Nebraska Sandhills, the initial relief felt by many Nebraskans has been tempered by the realization that the pipeline controversy is not over.

One of the many questions that remains unanswered is where the new route will go—and what protections will be provided for the people who live along its path. The legislature is expected to pass two pipeline bills on Tuesday, but neither offers any safeguards for landowners outside the Sandhills who may be affected by Keystone XL.

Rerouting the pipeline “represents a very substantial step forward,” said Nebraska Farmers Union president John Hansen. “[But] from our standpoint, where we represent all landowners, we’ve sort of traded one set of landowners for another.”

The Sandhills’ sandy soils and high water table make it especially vulnerable to contamination from potential oil spills. But water tables are also high in much of the farmland outside the Sandhills. If TransCanada—the company that wants to build Keystone XL—buries the pipeline about five feet deep, as it intended to do in the Sandhills, then the pipeline could still be submerged in water for part of the year. The biggest fear of many landowners is that an oil spill would leak directly into their groundwater.

The first bill under discussion in the legislature would set aside $2 million so Nebraska’s Department of Environmental Quality can help the U.S. State Department study alternative Keystone XL routes through the state. As part of that process, Nebraska will conduct a new round of public hearings so the affected landowners can voice their concerns. The State Department is responsible for deciding whether to approve construction of Keystone XL, which could eventually transport up to 830,000 barrels of tar sands crude oil per day from Alberta to refineries on the Gulf Coast.

The second bill would give Nebraska’s Public Service Commission (PSC) authority to site oil pipelines within the state and ensure that eminent domain is used only for projects that have PSC approval. But that bill applies to only future oil pipelines, not the Keystone XL.

Hansen said the Farmers Union will help landowners affected by the new route, just as it helped the Sandhills ranchers. Among other things, it will hold information sessions to inform them of their legal rights, especially when it comes to eminent domain.

“We’ve learned from this last go-around,” Hansen said.

Jane Kleeb, executive director of the anti-pipeline group Bold Nebraska, expects some of the Sandhills ranchers—now experienced in negotiating with TransCanada—to mentor the newly affected landowners.

She said eminent domain will remain a major challenge during the rerouting process. But the fact that the politically conservative legislature is likely to pass both pipelines bills is “nothing short of a miracle,” Kleeb said, and it’s a testament to Nebraskans who spent the better part of four years working to protect the Sandhills. “I think this was a huge success for citizens.”

New Route, Old Problems

Susan Luebbe, whose family runs a cattle ranch in southwest Holt County, on the eastern edge of the Sandhills, is among the Nebraskans who helped change the route—and she’s prepared to fight again if necessary. Luebbe said her activism has put her in touch with concerned citizens from throughout the state.

“We feel like we have a big family now, and we’re all in it together,” she said in a phone interview last week.

Like many Nebraskans, Luebbe joined the pipeline fight to protect her land and water from potential oil spills. She’s also angry at how TransCanada treated her family and others along the original route.

In the spring of 2008, TransCanada performed an aerial survey of her ranch without prior warning, Luebbe said. The helicopter flew so low that frightened cattle ran into a barbed-wire fence. Two calves were injured and “had to be stitched up.”

Later, when she refused to sign the easement contract the company offered her, TransCanada threatened to take her land through eminent domain. The company didn’t follow through on that threat, although it has begun eminent domain proceedings against landowners in other pipeline states.

“I know how they treated us—I can’t see them getting people to sign” along the new route, Luebbe said.

So far it’s unclear where the new route would run. “At this stage, we don’t have a line on a map,” TransCanada spokesman Shawn Howard told InsideClimate News on Friday.

Many Nebraskans have suggested moving it 100 miles east, parallel to an existing TransCanada pipeline known as Keystone or Keystone I. That pipeline runs over clay-based soils that offer better protection against groundwater contamination.

Last week, TransCanada President Alex Pourbaix told reporters that the reroute would probably be more modest, requiring only 30 or 40 miles of additional pipeline. Since shifting the original route west would take Keystone XL further into the Sandhills, Pourbaix’s suggestion would likely mean moving the pipeline east, into eastern Holt County.

A groundwater map from the University of Nebraska-Lincoln shows that eastern Holt County has the same shallow water table that makes the Sandhills so vulnerable. And it’s also home to ranchers whose livelihoods depend on groundwater.

Depth to grounwater map of Nebraska

That reroute could also take the pipeline into Boyd County, whose residents successfully fought off a proposed nuclear waste dump in the 1990’s.

“If TransCanada thought the Holt County landowners were hard to get along with, I suspect they’ll find more problems in Boyd County,” said Hansen, the Farmers Union president.

The Legislature Acts

The first bill the legislature is expected to vote on this week, called LB4, was created in part to assure landowners that their voices would be heard as the State Department decides where the pipeline should be rerouted. An agency spokeswoman said the study will probably be completed in early 2013.

LB4 is scheduled for a final vote on Tuesday and is expected to pass without a hitch. Although it doesn’t specify how Nebraska and the State Department will collaborate on the study (those details will be worked out at a later time), it includes an amendment saying Nebraska will pay about $2 million dollars for its share of the study.

TransCanada would normally fund the study, just as it paid for the State Department’s environmental impact statement (EIS) of the original pipeline route. But state senator Ken Haar, who helped lead Nebraska’s effort to get the pipeline out of the Sandhills, said the state will foot the bill in order to make sure the new EIS avoids any appearance of conflict of interest.

The State Department’s Inspector General is reviewing the agency’s decision to accept TransCanada’s recommendation that Cardno Entrix—a company with ties to TransCanada—be hired to conduct the original EIS for the Keystone XL.

Both TransCanada and the State Department defend their handling of that study. A State Department official told reporters that the agency supervised the entire process. And Howard, the TransCanada spokesman, told InsideClimate News that the company didn’t influence the EIS. “We don’t direct the work, we just get handed the bill for it.”

The other bill being considered by the legislature, the Major Oil Pipeline Siting Act, gives Nebraska the power to site future oil pipelines within its boundaries and limits the use of eminent domain to pipeline projects that have already been approved. An early version of the bill, introduced by Sen. Annette Dubas, would have applied to the Keystone XL as well. But Joselyn Luedtke, Dubas’ legislative aide, said that provision was dropped after TransCanada agreed to reroute the pipeline out of the Sandhills.

The original bill could have been the target of a lawsuit, Luedtke said, because state siting laws usually apply to recently proposed projects, not pipelines like Keystone XL, which has been under review for more than three years.

Luedtke said LB4 will ensure that the legislature still has some control over the Keystone XL. “TransCanada’s not circumventing Nebraska law. It’s just a different law that applies.”

Sen. Haar said it wasn’t easy to get the bills to the point they’re at now. He credits Gov. Dave Heineman for calling the special session to discuss pipeline siting legislation. He also credits Speaker of the Legislature Mike Flood for negotiating the rerouting agreement with TransCanada.

But Haar saved the largest measure of praise for the Nebraskans who spent years lobbying their elected officials. He said their relentless effort to protect the Sandhills reminded him of a phase carved in stone above the entrance to Nebraska’s capitol building: “The salvation of the state is watchfulness in the citizen.”

In the case of Keystone XL, he said, that’s exactly what happened.