TransCanada submits new Keystone XL route in Nebraska

WASHINGTON Wed Sep 5, 2012 2:55pm EDT

Russ Girling president and CEO of TransCanada, talks about the Keystone XL pipeline during the company's annual general meeting in Calgary, Alberta April 27, 2012. REUTERS/Todd Korol

Russ Girling president and CEO of TransCanada, talks about the Keystone XL pipeline during the company's annual general meeting in Calgary, Alberta April 27, 2012.

Credit: Reuters/Todd Korol

WASHINGTON (Reuters) - TransCanada Corp (TRP.TO) said on Wednesday it has submitted a new route for the project to build the Keystone XL oil sands pipeline from Canada to Texas that will avoid sensitive ecological areas in Nebraska.

The company said the 830,000 barrels per day pipeline will avoid the Sandhills, a region of prairie and sand dunes that is rich in plants and wildlife, with thousands of ponds and lakes.

President Barack Obama delayed a decision on the $7.6 billion pipeline application earlier this year, citing concerns about the northern portion of the route near a major aquifer and the Sandhills in the state.

The pipeline has been at the center of an emotional debate in the United States, pitting promoters of energy security and job creation against advocates of a green economy who fear the environmental risks of moving oil through the country's midsection.

TransCanada has been working with Nebraska officials to come up with a new route and it hopes to have U.S. State Department approval for the northern section early next year.

"Based on feedback from the Nebraska Department of Environmental Quality and the public, we have refined our proposed routing," Russ Girling, TransCanada's president and chief executive officer, said in a release.

The alternative route submitted in an environmental report to Nebraska on Wednesday was developed "based on extensive feedback from Nebraskans, and reflects our shared desire to minimize the disturbance of land and sensitive resources in the state," said Girling.

Nebraska's Department of Environmental Quality plans to publish maps of the new route on its website later on Wednesday, a public affairs official said.

NO MIDDLE MAN

An environmentalist who had seen the new route said it still crosses the Ogallala Aquifer, high water tables and sandy soil regions that could be vulnerable to a leak from the pipeline.

"We will not allow middle America to be the middle man for a foreign tar sands pipeline," said Jane Kleeb, the executive director of Bold Nebraska.

Grady Semmens, a spokesman for TransCanada countered that the new route avoids all of the official Sandhills and reduced the amount it would through pass through regions similar to the Sandhills to 36 miles from about 60 miles.

The new route reduces the length where the pipeline would cross the aquifer, but it is difficult to avoid it entirely, Semmens said, since the formation is under most of the state.

Nebraska Governor Dave Heineman must approve or deny the new route and send his decision to the State Department, which is conducting its own environmental review of the pipeline.

Construction on the 700,000 bpd southern part of the line, renamed the Gulf Coast project, has already begun after Obama gave his support for it.

The Gulf Coast project will drain a glut of crude in the U.S. heartland fed mostly by the oil boom in North Dakota.

The northern section of the line needs approval from the State Department because it crosses the national border. TransCanada hopes to have State Department approval by early next year with the aim of putting it into service by the end of 2014 or early 2015.

(Reporting by Timothy Gardner; editing by Gunna Dickson and Marguerita Choy)

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