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A Nebraska court has ruled that the Keystone XL pipeline can legally come through the state, with Congress approving a bill supporting the project. It sets up an expected showdown between the Republican-led Congress and the president.

Two obstacles have been removed from the Keystone XL project’s path, setting up a showdown with the president over the fate of the controversial pipeline project.

Congress has approved a bill on the project, pushing it through to the Senate next week, and a court has ruled in favor of the company’s route through Nebraska. It is the 10th time United States lawmakers have seen a bill relating to the project.

Members of Congress voted 266 to 153 to pass the bill on Friday, with 28 Democrats also throwing their weight behind the project as support for the president appears to be splintering. However the vote is still below the two-thirds majority needed to override a presidential veto.

Members of the energy committee in the US Senate voted 13 to 9 on Thursday to support backing the bill, deepening the support.

In Nebraska, the route has been bogged down in legal challenges since a group of landowners launched a claim that the route is unlawful. Friday’s ruling dismisses a lower court decision that had backed the landowners.

“We welcome the decision. This now clears the way for the State Department to complete the process,” said Canadian Natural Resources Minister Greg Rickford in a statement on Twitter.

The $8-billion project has been surrounded by controversy since its inception, with Republicans joined by a group of Democrats trying to pass a bill approving the pipeline in November. Their efforts were thwarted by the then Democrat-controlled Congress.

On Tuesday, Eric Schultz, a White House spokesman, confirmed the president would veto the project, a stance he reinforced on Friday in comments to The Hill.

“Regardless of the Nebraska ruling today, the House bill still conflicts with longstanding executive branch procedures … and if presented to the president, he will veto the bill,” Schultz said.

The decision comes amidst the ongoing oil glut, which has created five-year lows in the commodity and forced job cutbacks at oil companies across the world.

“The Nebraska ruling is very important in that it removes an uncertainty,” said Gaétan Caron, the former chair of Canada’s National Energy Board and an executive fellow at the School of Public Policy at the University of Calgary. “It simplifies the journey and it’s a step forward.

“The president has a very, very difficult task in front of him.”

While Republicans claim the project will be good for the American economy, a review led by the Department of State states that Keystone would only support 35 permanent jobs, with 42,000 temporary jobs coming in the two-year construction window.

However, Caron believes the project is beneficial to America in that it helps give it a larger share of the energy market. He also dismissed concerns about the currently falling oil price, noting the energy source is subject to fluctuations.

Shares of TransCanada (TSX:TRP,NYSE:TRP) closed the day up 0.75 percent to finish at $55.34.


Securities Disclosure: I, Nick Wells, hold no direct investment in any of the companies mentioned in this article.


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