Keystone Pipeline Leak Won't Affect Nebraska Expansion Ruling

LINCOLN, NE — The Nebraska Public Service Commission is slated to decide on Monday whether to sign off on a proposed expansion to the Keystone XL pipeline by TransCanada Corp. Its the last major regulatory hurdle for the project, which has faced numerous local, state and federal reviews and lawsuits since its 2008 announcement. And fortunately for TransCanada, a 210,000-gallon oil leak from the Keystone pipeline won't factor into that decision under state law.

TransCanadaa shut down the existing pipeline on Thursday and workers were working to determine what caused the spill on agricultural land in Marshall County, South Dakota, near the North Dakota border.

The spill didn't threaten waterways or drinking water, state and company officials said. But critics swiftly pointed to the leak as an example of what they see as environmental risks.

The Nebraska vote on Monday will be on a proposed route for Keystone XL, a massive expansion that would also be operated by TransCanada. The new pipeline would carry an estimated 830,000 barrels of oil a day from Canada's oil sands through Montana, South Dakota and Nebraska, where it would connect with the existing Keystone pipeline.

The decision on Monday will hinge on testimony and documents generated from public hearings over the summer and from more than 500,000 public comments, state Public Service Commission spokeswoman Deb Collins said. A state law passed in 2011 prevents the commission from factoring pipeline safety or the possibility of leaks into its decisions.

"The commission's decision ... will be based on the evidence in the record," Collins said.

The Keystone XL proposal has faced intense opposition in Nebraska from a coalition of environmental groups, Native American tribes and some landowners who don't want the pipeline running through their property.

Nebraska lawmakers gave the five-member commission the power to regulate major oil pipelines in 2011 in response to a public outcry over the pipeline and its potential impact on the Sandhills, an ecologically fragile region of grass-covered sand dunes.

But when they passed the law, legislators argued that pipeline safety is a federal responsibility and should not factor in the state decision.

Opponents of Keystone XL are incensed that the leak won't be considered.

"There is a reason TransCanada and the big oil lobby did not want this information on the record," said Jane Kleeb, director of the Bold Alliance, a coalition of groups that have opposed the Keystone XL for nearly a decade.

President Donald Trump issued a federal permit for the expansion project in March even though it had been rejected by the Obama administration.

The existing Keystone pipeline, where the leak was discovered, transports crude from Canada to refineries in Illinois and a major storage hub in Oklahoma, passing through the eastern Dakotas, Nebraska, Kansas and Missouri. It can handle nearly 600,000 barrels daily, or about 23 million gallons.

Since 2010, companies have reported 17 spills of oil or petroleum products in the U.S. the same size or larger than the leak announced Thursday, according to U.S. Department of Transportation records.

Officials in South Dakota said they weren't notified about the leak until roughly five hours after TransCanada discovered it. Brian Walsh, an environmental scientist manager at the South Dakota Department of Environment and Natural Resources, said officials would likely inquire about the delay but were focusing immediately on the spill.

TransCanada said Friday the leak was controlled and posed no threat to public safety. The company has sent more than 75 workers to the spill site, including environmental, engineering and emergency response specialists.

TransCanada spokesman Matthew John said the company will need to do "extensive testing" along with federal regulators and independent testing facilities before they can pinpoint a cause.

An aerial photo released by TransCanada on Twitter that the company says is of the spill, shows a darkened area on flat agricultural land. There do not appear to be any waterways or towns nearby.

Residents near the site reported a surge of activity as cleanup crews arrived at the scene.

Suzie Easthouse, general manager at the Front Porch in Langford, a city southeast of the spill area, said the restaurant will be catering for TransCanada workers at the site. Easthouse said she's serving Friday supper and a middle-of-the-night shift meal for 80 people, with meals for 100 people on Saturday.

"I'm pretty much going to be working a 24-hour shift here now," Easthouse said.

Easthouse said she has mixed emotions about the pipeline, a tug between the business it has brought to the area and her environmental concerns. She thinks the spill will have lasting effects in the area.

"It's almost like everybody's fears have come true with it," Easthouse said. "It's not the notoriety we really want in small town South Dakota."

By GRANT SCHULTE and JAMES NORD

Associated Press reporter Matt Brown in Billings, Montana, also contributed to this story.

Photo credit: DroneBase via AP; Jeff McIntosh/The Canadian Press via AP