The Natural Resources Committee heard testimony Nov. 9 on the final bill introduced this special session relating to oil pipeline regulation.
LB6, sponsored by Lincoln Sen. Bill Avery, would require a carrier authorized to build a pipeline in Nebraska to file a proof of indemnity bond of $500 million with the Nebraska’s secretary of state.
The bill would apply to pipelines larger than 25-inches of inside diameter and constructed for the purpose of transporting oil.
Avery said an indemnity bond would be used to restore land to its original state in the event of a major spill or leak. He said the amount of the bond was chosen based on evidence from the cost of cleaning up spills in other states.
“This [bill] is a fiscally responsible action to take to protect our land, our infrastructure and our natural resources, and our citizens deserve nothing less,” Avery said.
Marian Langan, executive director of Audubon Nebraska, testified in support of the bill. She said bringing lands in the Sandhills back to full ecological function following an oil spill could cost up to $300 per acre.
“Ecological restoration is extremely expensive,” Langan said. “At the bare minimum, even the cleanup is going to be hugely expensive.”
Ben Gotschall of Lincoln also testified in support of the bill, saying it would provide important financial protection for the state in the event of an oil spill.
“It’s important to get fair compensation for the state and for the counties,” he said.
Robert Jones of TransCanada testified against the bill, saying federal regulatory oversight already would require the company to respond promptly to any release of oil. A federal permit also would include restoration requirements, he said.
“[LB6] would mandate costs that are unnecessary and duplicative,” Jones said.
The committee took no immediate action on the bill.