President Obama appears willing to put off a decision on the Keystone XL oil pipeline at least until the midterm elections have passed, and a Nebraska judge now has given him the ability to do that.
Analysts say a court ruling last week — invalidating the pipeline's route through Nebraska and essentially putting the entire project on hold for the foreseeable future — means an ultimate decision on Keystone could be delayed another year or longer. The pipeline has been under study for more than five years, the entirety of Mr. Obama's time in office.
Before last week's ruling, the president was expected to make his decision this spring or early summer.
At the federal level, the State Department has concluded that the $7 billion project, which would transport more than 800,000 barrels of oil each day from Alberta through the U.S. heartland en route to refineries on the Gulf Coast, won't have a measurable impact on greenhouse gas emissions, but the department still must determine whether the pipeline is in the overall "national interest" before the president renders a final decision.
Because Keystone no longer has a legal route through the Cornhusker state, making that determination will be more difficult, said Brian Heslin, a lawyer with the Charlotte, N.C.-based firm Moore & Van Allen, which specializes in energy regulations and pipelines.
"Given that this pipeline is not going to circumvent Nebraska on the way down to the Gulf, there could be an argument that it's difficult to assess whether this is in the national interest because you don't have the full path of the pipeline through the various states," Mr. Heslin said. "If you were motivated to do so, you could make an argument, pending the approval decision and designated pathway [in Nebraska], the State Department is not in a position to determine if it's in the national interest."
The project has pitted environmentalists against a bipartisan coalition in Congress and business and labor groups, with Mr. Obama caught in the middle in an election year.
The State Department is continuing its review, and the president could make a decision on Keystone despite the legal and regulatory uncertainty in Nebraska.
Separate from the federal process, the Nebraska Public Service Commission is taking an entirely new look at the pipeline proposal.
In a lawsuit brought by three Nebraska landowners, Lancaster County Judge Stephanie Stacy said last week that the commission, not Gov. Dave Heineman, should have decided whether to green-light the Keystone path through Nebraska, and ruled the governor's approval of the route "null and void."
Mr. Heineman, a Republican, made the decision based on a 2011 state law that allowed his office to give TransCanada, the company proposing the pipeline, eminent domain rights in Nebraska.
With that law no longer valid, the commission must start the process from scratch.
Nebraska Attorney General Jon Bruning has appealed the decision. The NPSC will not begin its work until that appeal process has run its course, potentially adding months of delays. If the existing route is denied and a new path must be drawn up, the approval period would drag on much longer.
"We have intentionally stayed away from any meetings and any discussion related to the Keystone XL for the purpose of staying impartial. Frankly, with this ruling, we're just waiting to see what the attorneys have to say," said NPSC Commissioner Gerald L. Vap, a Republican who represents western Nebraska.
Environmental groups are heartened that the decision will result in another look at what they consider to be a dirty, dangerous pipeline.
"This week's court decision invalidating Keystone XL's route through Nebraska has reverberations that extend far beyond the borders of that state and is likely to have a major impact on the federal evaluation process," Anthony Swift, an attorney with the Natural Resources Defense Council, wrote in a column just after the Nebraska decision. "This decision is a huge win for both the citizens of Nebraska as well as the larger global community that would be subject to the climate impacts from an expanded tar sands industry."
TransCanada has said it is reviewing the court's decision and will decide soon on the best course of action.
• This article is based in part on wire service reports.
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