The Nebraska Supreme Court could rule as early as Friday on whether the governor had authority to approve a route for the controversial Keystone XL oil pipeline through the state.
The court heard arguments in the case in September after a lower court ruled against against a 2012 law that allowed Nebraska Gov. Dave Heineman (R) to greenlight Keystone’s route. The lower court said that law was unconstitutional, siding with landowners who challenged it.
Now both sides are anxiously awaiting the Nebraska Supreme Court’s decision, which could come Friday morning.
{mosads}The decision is key to the larger debate over the oil sands pipeline. Depending on which way the court rules, the State Department could resume its national determination review of the pipeline early next year.
The Obama administration froze its review of the pipeline in April to let the Nebraska court fight play out, enraging Republicans, the oil industry and pipeline developer TransCanada.
If the court doesn’t hand down a decision by Friday, the ruling will likely come early next year.
TransCanada says that even if the court rules in favor of landowners challenging the pipeline, the battle to approve the project won’t be over.
“It will be full steam ahead to Public Services Commission,” said Mark Cooper, spokesman for TransCanada. “There is tremendous support for the project from the people of Nebraska.”
A main point of contention is that when Nebraska’s governor approved the route, he went around the commission, which is typically the deciding factor.
Bold Nebraska, a coalition of landowners and tribal leaders who oppose the pipeline, said they are optimistic the court will uphold the lower court’s decision.
If the decision is overturned, however, opponents are pinning their hopes on President Obama to kill the $8 billion project, which would carry crude oil from Alberta, Canada, to Gulf refineries.
“We remain confident the president will stand with farmers, ranchers, and tribal communities over a foreign oil company that wants to get tar sands to the export market,” Jane Kleeb, founder of Bold Nebraska said last week.
If recent comments are any indication, Obama could be leaning toward rejecting the project.
During a push by Sen. Mary Landrieu (D-La.) in November to approve the project through legislation, Obama pushed back hard, urging lawmakers not to “short-circuit” the existing process at the State Department.
He also stressed that the pipeline “is providing the ability of Canada to pump their oil, send it through our land down to the Gulf, where it will be sold to everyone else.”
“It doesn’t have an impact on U.S. gas prices,” he said.
The recent plummet in oil prices has also undercut the arguments for Keystone, critics claim, and could bolster the argument from environmentalists that the pipeline is make-or-break for oil sands development.
Cooper rejected that notion.
“The people that are saying that are not our shippers developing oil sands,” Cooper said. “Our shippers are in it for long haul. Short swings in prices do not impact them significantly.”
“They continue to produce oil sands and will send the oil via higher-intensive modes of transportation like rail,” he added.