August 7, 2017 / 5:13 PM / 10 months ago

UPDATE 2-Keystone XL pipeline representatives quizzed in Nebraska hearings

(Recasts first sentence with lawyer questioning executives, adds details on hearing, comments by landowner, other background)

By Kevin O’Hanlon

LINCOLN, Neb., Aug 7 (Reuters) - An attorney representing opponents of TransCanada Corp’s proposed Keystone XL pipeline grilled the company’s representatives during hearings in Nebraska on Monday, in proceedings that mark the last big hurdle for the long-delayed project.

The proposed 1,179-mile (1,897-km) pipeline linking Canada’s Alberta oil sands to U.S. refineries has been a lightning rod of controversy for nearly a decade, pitting environmentalists worried about spills and global warming against business advocates who say the project will lower fuel prices, shore up national security and bring jobs.

President Donald Trump’s administration handed TransCanada a federal permit for the pipeline in March, reversing a decision by former President Barack Obama to reject the project on environmental grounds. But the line still needs a nod from regulators in Nebraska – which would be the last of three states to approve its proposed path into the heartland.

A lawyer for opponents of the line opened the hearing in front of the five-member Nebraska Public Service Commission on Monday morning by questioning an executive for the Canadian company about how the pipeline will be disposed of after its anticipated 50-year lifetime.

“Do we have to clean up TransCanada’s abandoned pipeline?” attorney David Domina asked TransCanada executive Tony Palmer, who responded that the company would pay for cleanup.

Later, Domina had a tense exchange with Ernie Goss, an economist who was paid by TransCanada to look at the economic impact of the pipeline, after Goss said he did not have a source for some economic data he cited during the hearing.

“An economist would generally look that up and have a source,” Domina said.

Nebraska’s Public Service Commission will weigh whether the project is in the state’s public interest, and will announce a decision by November.

Proponents of the pipeline will argue the project will bring in hundreds of jobs and millions of dollars in revenue. Trump has said the pipeline would create 28,000 jobs nationwide, but a 2014 State Department study predicted just 3,900 construction jobs and 35 permanent jobs.

TransCanada would also pay property taxes to Nebraska counties through which the pipeline would run. While the state has no estimate of Keystone XL pipeline’s potential taxable value, an existing TransCanada line in Nebraska had a taxable value for the state of about $466 million in 2016, said Jon Cannon, a manager of the policy and legal section of the state’s property assessment division.

The arguments of opponents are constrained by the rules of the commission, which is not permitted to consider the risk of spills because the route already has an environmental permit.

Instead, the opponents – who include scores of landowners on the proposed route – will argue the jobs are temporary and the risks to local industries like cattle ranching are too great. They will also note that if the commission approves the line, TransCanada could seek to seize property along the route using eminent domain law - a politically unpalatable option in the conservative state.

Landowner Ken Prososki, whose farm and ranch land is on the pipeline route and who opposes the project, expressed frustration at the drawn-out fight.

“It’s an interesting process. I’ll put it that way,” he said.

On Sunday, hundreds of pipeline opponents, including members of Indian tribes, marched through downtown Lincoln under police escort, following a rally at the Nebraska Capitol.

The 830,000 barrel-per-day Keystone XL would link Alberta to an existing pipeline network feeding U.S. refineries and ports along the Gulf of Mexico.

The project could be a boon for Canada, which has struggled to bring its reserves to market. But demand for the line has declined since it was first proposed, due to surging U.S. production, lower prices, and other Canadian pipeline projects.

Additional reporting by Valerie Volcovici in Washington, and Ethan Lou in Calgary; Writing by Richard Valdmanis; Editing by Lisa Shumaker and Matthew Lewis

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