Nebraska issues map of sensitive Sandhills area

TransCanada Corp. says Nebraska's newly issued map of environmentally sensitive areas is "extremely helpful" and will help the Canadian energy giant pin down alternative routes through the state for its controversial Keystone XL oil pipeline.

"We needed to see that definitive map that is defined by the State of Nebraska and by the DEQ (Department of Environmental Quality) to tell us . . . this is where we define the sensitive areas to be," said James Millar, TransCanada's manager of communications.

"This is something that will be very helpful and positive as we move forward to determine alternate routes for Keystone XL through the Sandhills."

The U.S. State departmentsurprised the pipeline's supportersin November by ordering Calgary-based TransCanada to re-route the $7-billion pipeline, which is intended to connect Canada's oilsands to the Gulf of Mexico region.

While the proposed pipeline will reportedlycreate 20,000 jobs and help find new refinery markets for Alberta's growing oilsands production, it has come under fire from environmentalists and other critics about the influx of more so-called dirty oil into the United States.

On Thursday, Nebraska's environmental department released a map of the sensitive Sandhills region and said it would be sent to TransCanada.

"Obviously, the applicant cannot propose the route without knowing the area to be avoided," Mike Linder, director of the department, said in a statement.

"NDEQ has been reviewing available information and has selected a map of ecoregions which was finalized in 2001 as best depicting the Sandhills region."

TransCanada's proposed Keystone XL project is designed to carry oil from Alberta across Montana, South Dakota, Nebraska, Kansas, Oklahoma and Texas to refineries on the Gulf Coast.

The company also has proposed connecting it to the Bakken oilfield in Montana and North Dakotaa major new source of crude in the United States.

Millar said the state map will allow the company to narrow down alternative routes to those "that would have the least amount of impact on landowners."

Millar added that by issuing the map state officials have shown that both the government and TransCanada are working co-operatively.

"And that's something we're striving to do is work collaboratively with DEQ and with the state to suggest the best alternative route for Keystone in Nebraska."

Cost of rerouting pipeline not yet clear

Millar said the company hasn't yet calculated the additional cost of rerouting the Nebraska leg of the 2,700-kilometre pipeline. However, the addition of an estimated 160 kilometres "wouldn't be material to the overall cost," he added.

"But we still don't know what the dollars would be until we actually have a route determined because length of pipe impacts price. The number of pump stations that you may add impacts price. Those are the two big variables."

Meanwhile, Millar refused to speculate on any additional roadblocks that might be thrown up by regulators.

After 3years of working on the project, several environmental impact statements and some 10,000 pages of analysis "we'll continue to follow the process that's outlined by State and that's really all we can do," he said.

"We're in the business of building pipelines. We've done it for 60 years and there's always been a regulatory approval anytime you build a piece of infrastructure and we need to follow process and that's what we're doing."

Originally, TransCanada had expected to receive approvals from the U.S. State Departmentrequired because the pipeline crosses an international boundaryby the end of 2011.

But the department said in November, amid widespread protests by environmentalists and others opposed to the pipeline, that it would be delaying its decision until after the 2012 presidential election.

Since then Congress has passed, andPresident Barack Obamahas signed a bill that forces his administration to make a decision within 60 days.