Texas judge lifts halt on TransCanada pipeline construction

HOUSTON Thu Dec 13, 2012 1:48pm EST

HOUSTON Dec 13 (Reuters) - A Texas judge on Thursday lifted a temporary restraining order filed by a landowner that had halted some of TransCanada Corp's work on a pipeline to carry heavy crude oil from Oklahoma to Texas refineries.

Texas County Court at Law Judge Jack Sinz in Nacogdoches County ordered TransCanada last week to stop building a pipeline, the southernmost section of the contentious Keystone XL project, across the property of Michael Bishop in east Texas, about 150 miles (241 km) northeast of Houston.

In the order, which took effect on Tuesday, Sinz said there was "sufficient cause" to halt work on Bishop's 20-acre (8 hectare) property until a planned Dec. 19 hearing. At Thursday's hearing, Sinz lifted that restraining order, TransCanada said.

Bishop has claimed that TransCanada is in violation of its permit because the pipeline would carry heavy oil, or bitumen.

"TransCanada has followed all of the laws established by the State of Texas and has the legal authority to construct the Gulf Coast Pipeline, and none of Mr. Bishop's claims are supported by credible facts," TransCanada said in a statement.

The U.S. Army Corps of Engineers gave a permit in July to the $2.3 billion Gulf Coast Project, which will carry 800,000 barrels of crude per day from the Cushing, Oklahoma, storage hub to Houston.

Early this year, TransCanada split the section off from Keystone XL so it could start construction after President Barack Obama rejected the part of the project that runs from Canada through Nebraska. The company has reapplied to build that $5.3 billion portion and expects a decision from the U.S. State Department by the end of March.

There have been sporadic pipeline protests across Texas, including demonstrators who chained themselves to machinery and suspended themselves from trees in the path of the pipeline in east Texas in November. Actress Daryl Hannah was arrested along with a Texas landowner in October for attempting to block a bulldozer from clearing land for the pipeline.

According to Bishop, a 64-year-old ex-Marine and medical student, the material to be carried on the pipeline is not crude oil but diluted bitumen, which does not meet the conditions of TransCanada's permits.

Bishop, who is representing himself in the case, is also challenging whether TransCanada, Canada's largest pipeline company, can use eminent domain to condemn private land for pipeline construction.

TransCanada says that, despite some limited landowner protests, it has obtained voluntary negotiated easements for about 99 percent of the Texas portion of the pipeline.

"You're always going to have a small number of people who challenge these situations and it's just kind of the business we're in," said Alex Pourbaix, president of TransCanada's oil pipelines division.

The pipeline is the southern leg of the Alberta-to-Houston Keystone XL project, which TransCanada split in two after U.S. President Barack Obama refused to approve the project last year because of environmental concerns.

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