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Nebraska Governor Pete Ricketts optimistic on TransCanada’s Keystone XL

Pete Ricketts, the Governor for the state of Nebraska, is photographed at the Doubletree Hotel in Toronto, on Aug. 8, 2017.

Fred Lum/The Globe and Mail

Nebraska Governor Pete Ricketts expressed optimism on Tuesday that the state's Public Service Commission will give the green light to TransCanada Corp.'s proposed Keystone XL pipeline, despite determined and broad-based opposition to it in Nebraska.

In Toronto, during a five-day trade mission in Canada, Mr. Ricketts – a long-time supporter of the proposal – said the $8-billion (U.S.) project would bring significant benefits in the form of jobs and tax revenue to his state, and will be "the safest pipeline built to date."

While he acknowledged there is staunch resistance, he said opponents represent a minority of Nebraskans. "The majority of Nebraskans see the bigger picture here with regard to the jobs, the property tax base, the energy security and so forth," he said. "I'm confident the Public Service Commission will do their due diligence and come out with a ruling that this is in the interest of the taxpayers of Nebraska."

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The long-delayed pipeline would deliver up to 830,000 barrels a day of heavy Canadian crude to a terminal in Nebraska, from which it would be shipped to the U.S. Gulf Coast and other markets. The Calgary-based pipeline company is looking to secure more committed customers to support its construction, and launched an "open season" last month to lock down 225,000 barrels a day in firm contracts in addition to those it has already secured.

Approval by the Nebraska commission is the last major regulatory hurdle faced by TransCanada, after U.S. President Donald Trump revived the project when he issued a presidential permit earlier this year.

However, some Native American leaders are promising to launch lawsuits and take other action to stop it. Several Indigenous communities in Nebraska signalled their opposition on Tuesday when they joined the "treaty alliance against tar sands expansion," a group of some 150 First Nations in Canada and tribes in the United States who oppose oil sands development and pipelines through their traditional territory.

"As the state of Nebraska stands poised to make a potentially life-altering decision about permitting this poisonous bitumen to be inflicted on its population, we stand poised to protect all life now and in the future," Larry Wright, chairman of the Ponca Tribe of Nebraska, said in a news release.

However, Mr. Ricketts said the pipeline route does not cross any Native American reservations, and that the state and the company will ensure the risks to the environment are mitigated.

The governor has no role in approving the pipeline. Under state law, the Public Service Commission has the final word in determining whether it would benefit Nebraskans and approving the 440-kilometre route in the state.

"I've been supportive of the pipeline since it was announced, even before I became governor, and I think this is a good deal for Nebraska," Mr. Ricketts said. Nebraska will benefit from as many as 4,500 jobs during the two-year construction period, and $12-million (U.S.) annually in property tax revenues, TransCanada contends.

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Opinion in the state is divided, with opposition going far beyond environmentalists and Indigenous activists.

While TransCanada says it has agreement with landowners along 80 per cent of the route, some are holding out and adamantly oppose expropriation that would occur if the two sides cannot come to agreement over access.

In filings with the commission, two counties in rural regions of the state voiced their opposition to the project. Holt County – a sprawling jurisdiction near the South Dakota border – submitted minutes from a meeting in which the board of supervisors unanimously opposed "all crude oil and or tar sands pipelines" across the county.

However, six other counties and towns registered their support. Nance County board chairman Tim Cornwell submitted a letter in which he described pipelines as "the safest, greenest, most reliable and cost-efficient way to transport oil over long distances" and welcomed the economic benefits that would flow.

The commission is required to issue its decision by the end of November.

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Timing of governor's trade tour 'serendipitous'

With the first round of negotiations on the North American free-trade agreement (NAFTA) a week away, Nebraska's Republican governor is in Toronto pushing the importance of the trade deal for his state.

States in the agricultural heartland of the United States have benefited enormously from NAFTA, said Governor Pete Ricketts in an interview with The Globe and Mail. Leaders of Midwestern states such as himself are working to make sure that message is heard in the White House, where U.S. President Donald Trump has been making conflicting, though largely negative comments about the 23-year-old trade deal.

"NAFTA has worked very well for Nebraska," said Mr. Ricketts, who will also visit Ottawa during the five-day trip. "There's not a whole lot on our list with regard to what needs to be changed. Although, any time you can make sure you're harmonizing regulations and making sure that you're not putting up any non-tariff trade barriers, that's a good thing."

Canada is Nebraska's largest trading partner with the state sending $468-million (U.S.) worth of agricultural products north of the border in 2016. In 2015, exports included $138.2-million worth of beef and $61.3-million of pork.

"We're here to say thank you to our biggest customers," said Mr. Ricketts, adding that his trade mission is not directly related to the NAFTA negotiations, although the timing was "serendipitous."

Mr. Ricketts, who comes from a wealthy and politically influential family, came out in support of Mr. Trump shortly before his nomination in the Republican primary, and his family gave $1-million in support of Mr. Trump's election campaign. However, he's one of a number of Republican leaders from agricultural states whose views on NAFTA seem to diverge from the President's.

Last weekend, Canadian Parliamentary Secretary for Agriculture Jean-Claude Poissant met with U.S. Secretary of Agriculture Sonny Perdue and several Republican lawmakers at the Iowa Ag Summit, an important meeting of U.S. agricultural interests.

"The common message there was that agriculture has benefited enormously, states like Iowa and Nebraska have benefited enormously," said Khawar Nasim, a Canadian consul general who covers five Midwestern states and who attended the meeting. "Their approach on NAFTA is do no harm, and seek to be more ambitious in areas like regulatory co-operation."

Mark Rendell

Video: Pipeline protesters gather at Trudeau’s Seattle visit (The Canadian Press)
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About the Author
Global Energy Reporter

Shawn McCarthy is an Ottawa-based, national business correspondent for The Globe and Mail, covering a global energy beat. He writes on various aspects of the international energy industry, from oil and gas production and refining, to the development of new technologies, to the business implications of climate-change regulations. More

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