May 20, 2015 Article

Nebraska Court Upholds Eminent Domain, Facilitating Keystone Pipeline Development

But the fate of the controversial pipeline is still uncertain in the Cornhusker State

by Patrick Gallagher

While the battle over the Keystone XL pipeline rages at the federal level, the future of the proposed 1,179-mile, 36-inch-wide underground pipeline rests in part on the outcome of dozens of ongoing legal battles in Nebraska state courts. After it successfully defended its permit to exercise the power of eminent domain before the state’s high court, TransCanada Keystone Pipeline, LP, began proceedings in late January to acquire rights of way across some 90 Nebraska properties in preparation for construction on the Keystone XL pipeline.

In Thompson v. Heineman (decided on January 9), a divided Nebraska Supreme Court upheld the validity of a 2012 amendment to the state’s law governing the exercise of eminent domain by common carriers, Neb. Rev. Stat. § 57-1101. The amendment, known as L.B. 1161, makes it possible for certain major oil pipeline developers, such as TransCanada, to obtain a permit to construct an oil pipeline and exercise the power of eminent domain without the approval of Nebraska’s utilities regulator.

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