Nebraska judge strikes down law that let Keystone pipeline through state

WASHINGTON—Canada’s lobbying campaign for the Keystone XL pipeline took an unexpected blow Wednesday when a Nebraska judge struck down an industry-friendly law used to determine its path through the state, leaving the project in regulatory limbo.

The district court ruling in Nebraska, epicentre of the staunchest opposition to the Alberta-to-Texas pipeline, emerged as a fresh setback to Ottawa’s overarching economy priority.

The decision came mere minutes before Prime Minister Stephen Harper and President Barack Obama emerged for an all-smiles photo-op at the North America Leaders Summit in Mexico, masking differences over a long-delayed pipeline that stands as far and away the foremost irritant in Canada-U.S. relations.

Ottawa had in recent weeks aggressively ramped up pressure in Washington, demanding a swift yes-or-no answer to the five-year-long Keystone riddle. But White House officials demurred, insisting the State Department’s federal regulatory process would continue apace, with no decision likely until mid-summer.