Nebraska's governor called a special session of the state Legislature yesterday to address concerns about oil pipelines in a move that could lead to the rerouting of a controversial project stretching from Canada to Texas.

Analysts said the announcement from Gov. Dave Heineman (R) also could delay a decision about a cross-border permit from the State Department on the proposed TransCanada Corp. pipeline, known as Keystone XL. That raises the prospect that President Obama might have to consider one of the most contentious environmental issues of his presidency during an election year, rather than this year.

The State Department had been expected to make a decision by January on the $7 billion project, which has been the subject of intense lobbying for months.

Supporters say the 1,700-mile pipeline is critical for weaning the United States off of Middle Eastern oil and creating jobs, while critics slam it for its potential to raise greenhouse gas emissions and cause oil spills. It would roughly double the amount of Canadian oil coming into the United States.

"This is a game-changer," said Anthony Swift, a policy analyst at the Natural Resources Defense Council, about the Nebraska announcement. "This really puts the State Department schedule in doubt."

The Nebraska Legislature has some jurisdiction over the routing of pipelines, he said, and could pass new rules prohibiting the construction of "hazardous liquid pipelines" in certain areas of the state, said Swift. In addition to climate change, environmentalists have raised concerns that Keystone XL would pass through the Ogallala Aquifer, a large drinking-water source in the region.

If the special session results in legislation that would reroute the pipeline, State would have to draft an entirely new environmental impact statement in a process that could take additional months, said Swift. Other changes to state law could lead to delays in construction or threaten existing agreements with oil companies, he said.

Pressure on the Legislature

Yesterday, TransCanada spokesman Terry Cunha said in a statement the company was still expecting State to make a decision by this year. He noted Heineman's comments at a press conference that Nebraska legislators also could come away from the session with the conclusion that they do not have the "legal or constitutional grounds" to pass new legislation.

Heineman said the unicameral Legislature would meet Nov. 1 to possibly draft and pass new rules on the siting of oil pipelines generally. He made it clear that his attention was on Keystone XL, which would ferry a form of oil from Alberta's oil-sands region that is more carbon-intensive to produce than oil obtained from traditional drilling.

"I believe Nebraskans are expecting our best efforts to determine if alternatives exist," said Heineman, who sent a letter to Obama this summer raising concerns about the proposed route of Keystone XL because of worries about oil spills in Nebraska's Sandhills region.

The session would allow a "thoughtful and thorough public discussion about alternative solutions that could impact the route of the pipeline in a legal and constitutional manner," Heineman said.

Nebraska Sens. Ben Nelson (D) and Mike Johanns (R) also have raised concerns about Keystone XL's proposed route in their home state.

According to Swift, state legislators will be under pressure to draft something out of the special session. "It will be hard for them not to do something," he said.

They have a few options. They could take away automatic authority for operators to use eminent domain to build the pipeline, according to Swift. They also could restrict where potentially "hazardous" pipelines run generally, he said, and essentially declare that any oil-sands pipeline must stay away from the Ogallala Aquifer.

The key thing legally, he said, is that any law not target TransCanada or Keystone XL specifically. Rather, it could address broader concerns about certain types of pipelines, he said.

Green groups: nowhere else to go?

Cunha of TransCanada said the three-year process on the final environmental impact statement, which was released in August, concluded that Keystone XL would have minimal impact on the environment. "The pipeline takes the safest route -- physically and environmentally," he said.

Earlier this month, TransCanada offered a $100 million performance bond and other oil spill protection measures to Nebraska lawmakers in an attempt to lower opposition to the project (Greenwire, Oct. 18).

The speaker of the Nebraska Legislature, Mike Flood, also raised some concerns about the possibility of new legislation, according to Cunha. Flood said that a revised siting framework for oil pipelines could take 16 months to put in place, and could raise "legal and financial" ramifications.

Since the death of major climate legislation, Keystone XL has emerged as the focus of much of the environmental movement in the United States.

Earlier this year, environmental activists were arrested at the White House, saying that they are willing to engage in ongoing civil disobedience to protest the project and to possibly stay home next year on Election Day in protest.

"The president is counting on the fact that environmentalists don't have anywhere else to go in 2012," Julian Zelizer, a professor at Princeton University, told ClimateWire earlier this year. "The risk is that they won't do much to help him get re-elected, and that can make a huge difference."