TransCanada CEO ‘undeterred’ by new hurdle for Keystone XL

WASHINGTON — TransCanada Corp. officials said Thursday they are undaunted by a Nebraska court ruling that analysts widely believe will mean more delays for the Keystone XL pipeline.

TransCanada Corp. CEO Russ Girling said the company was “clearly disappointed” by the district court decision striking down  legislation that had authorized Gov. Dave Heineman authority to approve a new route for the pipeline.

“This is a solvable problem, and we are undeterred,” Girling said in a conference call to discuss the company’s fourth quarter 2013 earnings. “We’ve dealt with many issues on Keystone XL in the past, and we have many options to deal with this current hurdle.”

Nebraska’s attorney general immediately appealed the ruling, which concluded that the legislation passed in 2012 effectively usurped the authority of the state’s Public Service Commission to rule on a new pipeline route. TransCanada had worked with Nebraska officials, including Heineman, in 2012 to reroute Keystone XL’s planned path through the state to avoid environmentally sensitive areas.

Girling said TransCanada was weighing all of its options and had not decided on its next step. The company could wait for the appeal to play out in Nebraska courtrooms or file a new pipeline application with the state’s Public Service Commission. The state legislature also could be called into a special session to tackle the issue.

Federal review 

The State Department’s recently completed environmental review of the project is pegged to the new route — which in turn hinges on Heineman’s approval and the Nebraska legislation authorizing it.

Girling was steadfast in insisting that the Nebraska court ruling should not cause any delay in the State Department’s ongoing assessment of whether Keystone XL is in the “national interest,” an analysis that folds in concerns about energy security, trade, foreign relations, the economy and the environment.

“Our view is a collection of both internal and external advisers who have told us there is no reason the Department of State process has to be impacted by the process in Nebraska,” Girling said. “The process in Nebraska will have to sort itself out, but that’s not related to what’s going on at the Department of State at this particular time.”

Related story: Environmentalists question substance of Keystone fight

But the State Department previously has said Nebraska route considerations had to wrap up before it could complete environmental analyses or do other work on the project, suggesting a similar delay could be on the horizon.

Other federal agencies have roughly three months to weigh in on the “national interest” question. But there is no time limit for a final decision after the 90-day interagency review period ends.

‘Keystone Standard Time’

Benjamin Salisbury, with FBR Capital Markets, said in a research note that any standstill in Nebraska potentially complicates or delays the president’s decision.

ClearView Energy Partners told its clients that the ruling “could give the State Department and the White House a reason to extend the ongoing national interest determination process.”

“Things always seem to take a bit longer on ‘Keystone Standard Time,'” quipped Kevin Book, managing director of the D.C.-based research firm.

Related story: Former Obama administration official urges Keystone XL approval

Girling insisted that with strong demand for pipelines to move Bakken and Canadian crude to Gulf Coast refineries, TransCanada is not backing down from the project.

“The market demand for this pipeline hasn’t gone away. In fact, it’s increasing,” Girling said. “As long as the demand stays there, and our customers want this pipeline built, TransCanada will be 100 percent committed to getting it done.”