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Analysis: Keystone XL pipeline would generate $1.8 billion for Nebraska - Kearney Hub: State

Analysis: Keystone XL pipeline would generate $1.8 billion for Nebraska

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Posted: Thursday, January 17, 2013 12:00 am

LINCOLN — A new study commissioned by supporters of the controversial Keystone XL oil pipeline says Nebraska could reap close to $2 billion in economic benefits if the project were built.

Creighton University economist Ernie Goss, hired to conduct the analysis, said pipeline construction would create several thousand Nebraska jobs while ongoing operations would result in several hundred positions. Over the next 16 years, the pipeline would generate close to $60 million in property tax revenue for the counties where it would be located, Goss said.

“You're talking about jobs, you're talking about economic development for the state and you're talking about very significant tax revenues,” said Michael Whatley with the Consumer Energy Alliance, the Houston-based group that commissioned the study.

Pipeline opponent Jane Kleeb with the group Bold Nebraska dismissed the report without seeing the results. As with other studies touting the pipeline's benefits, she said the Goss study relies on data supplied directly by TransCanada, the company that wants to build the project.

“We're more concerned about the economic risks, not the inflated economic benefits from these biased reports,” she said, referring to the costs of an oil spill.

The Goss study will be released today as Gov. Dave Heineman is still considering whether to approve a new route for the underground pipeline. The original route was altered to avoid the Nebraska Sand Hills and its underground aquifer, which many believed were at risk from an oil pipeline.

The pipeline would carry crude oil from Canada's tar sands region and North Dakota's well fields to Gulf Coast refineries.

As for his study, Goss confirmed he used data provided by the alliance, which, in turn, obtained it from the company. But he conducted an independent analysis of the data without outside influence, he said.

“I'm not in support or against; I'm just an economist,” Goss said. “The tough questions aren't decided by economists.”

Some of the highlights of his report:

- The project would generate $1.8 billion in “overall economic activity” in Nebraska from 2013 to 2029.

- TransCanada will spend about $580 million in the state during the two-year construction phase and $570 million more during subsequent years of operation.

- The project would create 5,500 jobs during construction and 302 jobs afterward. The figures include both direct and indirect jobs, paying an average annual salary of $38,000, Goss said.

- The pipeline would result in $58.6 million in property taxes, $39.1 million in sales taxes, $23.4 million in income taxes and $13.5 million in other taxes.

Goss' findings generally indicated a larger economic impact from the pipeline than another analysis released Jan. 4 by the Nebraska Department of Environmental Quality. For example, the DEQ report said pipeline construction would produce $418 million in economic benefits and 4,560 jobs.

Goss said he and the DEQ used several different variables to crunch the data, which can explain the different findings.

Kleeb, the pipeline opponent, pointed to a 2011 study by Cornell University that projected the company would spend substantially less than it claimed on pipeline construction and that most of the jobs created by the project would be temporary.

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