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Nebraska approves TransCanada’s Keystone XL

20 Nov 2017, 4.17 pm GMT

Nebraska approves TransCanada's Keystone XL

Houston, 20 November (Argus) — Nebraska regulators today approved the route of TransCanada's long-delayed 830,000 b/d Keystone XL crude pipeline, the last major regulatory hurdle for the project to proceed.

The Nebraska Public Service Commission voted 3-2 to approve a route through the state.

The $8bn Keystone XL project would transport crude from Alberta's oil sands to Steele City, Nebraska, which is already linked to Cushing, Oklahoma, and the southeast Texas coast.

TransCanada first proposed Keystone XL in 2008 but it was delayed repeatedly. The administration of previous US President Barack Obama in 2015 blocked Keystone XL after years of review, citing environmental concerns.

The project was revived this year, receiving a cross-border permit from the administration of President Donald Trump on 24 March.

Opposition against Keystone XL flared most strongly in Nebraska, where the company still did not have a route approved when it pulled its state application after Obama denied the border-crossing permit.

The Nebraska Public Service Commission held formal hearings on the project in August.

The Nebraska decision comes a week after a major spill on another TransCanada oil line. A large portion of the 590,000 b/d Keystone crude pipeline was shut on 16 November after a after a leak of an estimated 5,000 bl of crude in Marshall county, South Dakota.

TransCanada shut the line from Hardisty, Alberta, to Cushing, Oklahoma, and to Wood River and Patoka, Illinois. The southern leg of the system, known as Marketlink, from Cushing to the US Gulf coast was not affected.

The company is making progress on cleaning and remediating the site and the cause of the leak remains under investigation, a TransCanada spokesman said today.

Keystone XL is now the lone new TransCanada crude export project out of western Canada after the company in October cancelled its 1.1mn b/d, C$15.7bn ($11.9bn) Energy East project "after careful review of changed circumstances."

The move came after Canada's National Energy Board announced a broader review of the Energy East project, including its impact on upstream and downstream greenhouse gas emissions.

TransCanada said during its third quarter earnings call that it was encouraged by the results of a recent open season on Keystone XL. TransCanada expects shipper support to be the same as when it first applied for the Keystone XL permit in 2008 and is targeting 20-year contracts for about 500,000 b/d of the total capacity, said liquids pipeline president Paul Miller.

The company said it is reviewing the results of the open season, including some conditions requested by shippers that mostly refer to specific logistics issues.

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