Reclamation requirements for abandoned pipelines proposed

The Natural Resources Committee heard testimony Feb. 16 on a bill to rename and update the Nebraska Oil Pipeline Reclamation Act to apply to abandoned pipelines.

Lincoln Sen. Eliot Bostar, sponsor of LB1186, said current state law does not cover carbon dioxide pipelines, a fast-growing industry, and fails to protect landowner property rights by allowing pipeline companies to keep permanent right-of-way easements after a pipeline ceases operation.

Under LB1186, the renamed Hazardous Liquid Pipeline Reclamation Act would apply to pipelines carrying liquified carbon dioxide as well as petroleum.

It also would add the costs of mitigating the impacts of an abandoned pipeline to a list of reclamation costs for which a pipeline carrier is financially responsible.

The bill would require a pipeline carrier to provide written notice that it has abandoned a pipeline to all owners or holders of real estate in which the carrier owns an easement for the pipeline.

Upon request of the landowner, a carrier then would complete the landowner’s chosen reclamation activities within three years and revert its easement to the landowner.

If the carrier fails to comply with the proposal’s requirements, a landowner whose property contains an abandoned pipeline could revert the carrier’s easement and recover reclamation costs from the carrier and its successors through a process outlined in the bill.

Finally, LB1186 would create a cash fund, administered by the state Department of Environment and Energy, that would be funded by amounts paid by pipeline carriers when they abandon a pipeline.

A carrier or landowner could apply to the department for reimbursement for their reclamation costs.

“This cash fund will ensure that the dollars necessary to meet private and public landowner reclamation costs after possible pipeline abandonment will be paid by the owner of the pipeline and not by impacted landowners, a county or the state,” Bostar said.

Brian Jorde, a lawyer at Domina Law Group in Omaha, testified in support. Because pipeline carriers have the power of eminent domain, he said, landowners have no power to negotiate terms related to the abandonment or reclamation costs of a pipeline on their land.

Jorde said pipelines are an inconvenience that prevent landowners from using their property in certain ways. When a company abandons a pipeline, he said, landowners should be able to require that it be removed and regain full rights over their property.

Megan Hammond, a York County landowner, also testified in support. She said she and her family worked unsuccessfully with local commissioners and zoning boards to establish pipeline regulations after learning that their land was in the Keystone XL project’s proposed route.

Now, she said, her land is in the path of a proposed carbon dioxide pipeline.

“I am sure this contract will have no mention as to what happens when they’re done with it,” Hammond said. “We don’t get our easement back, and we’re stuck with their junk pipe.”

Jane Kleeb testified in support of the bill on behalf of Bold Alliance. She said the proposal would create jobs and protect landowners’ property rights.

“At the very least,” Kleeb said, “our state owes farmers and ranchers the opportunity to choose if a pipeline is removed from their land, not at their cost, but at the … [cost of the] company that makes billions of dollars transporting oil, gas or, potentially, carbon dioxide.”

Dawn Caldwell testified in opposition to LB1186 on behalf of Renewable Fuels Nebraska. She said the state’s ethanol industry seeks to improve its “value chain” by sequestering the carbon dioxide emissions from ethanol plants.

However, Caldwell said, most plants would have to pipe their carbon dioxide to suitable sites where it can be injected into underground geologic formations. She said the additional proposed regulations on pipelines would discourage carbon capture and sequestration companies from working in Nebraska.

Bruce Riecker also testified in opposition to the bill on behalf of the Nebraska Farm Bureau. He said pipelines already are regulated by the federal Pipeline and Hazardous Materials Safety Administration.

Additionally, Rieker said, digging up buried pipelines would disrupt the surrounding soil, increasing erosion and destroying organic matter.

“As stewards of the land, we believe the changes called for would cause more harm than good to our valuable ecosystem,” he said.

The committee took no immediate action on the bill.