TransCanada agrees to reroute Keystone XL pipeline

TransCanada has agreed to change the route of acontroversial proposed oil pipelineso that it doesn't pass through an environmentally sensitive part of Nebraska.

The Canadian-based company announced the decision Monday at a news conference at the Nebraska Capitol.

"I can confirm the route will be changed and Nebraskans will play an important role in determining the final route," Alex Pourbaix, TransCanada's president of energy and oil pipelines, said in a statement about the Keystone XL pipeline.

Pourbaix told a news conferencein Lincoln, Neb., that rerouting the pipeline would likely need 50 to 65 extra kilometres of pipe and an additional pumping station.

Pourbaix said the company supports a proposal introduced in the state legislature that, if passed,would ensure the pipeline route would avoid the ecologically sensitive Sandhills area.

The TransCanada statement said Nebraska's Department of Environmental Quality (DEQ) will work with the U.S. State Department to conduct an environmental assessment to "define the best location for Keystone XL in Nebraska."

"We will co-operate with these agencies and provide them with the information they need to complete a thorough review that addresses concerns regarding the Sandhills region," the statement said.

Earlier Monday, Speaker of the Nebraska Legislature Mike Flood saidthis action by TransCanada cameafter he received confirmation from the U.S. State Department that Nebraska does indeed have the authority to conducta supplemental environmental impact study.

Flood saidthat Nebraska'sDEQ would follow federal rules.

"There will be public hearings, there will be transparency," he said on the floor of the state legislature. "That's the way the process works and that's the way it will work in Nebraska."

TheTransCanada statement follows the U.S.federal government's announcement last week that it would delay a decision on a federal permit for the project until it studies new potential routes that avoid the Sandhills area and theOgallala aquifer in Nebraska, a vast underground water supply. Ponds and lakes in the Sandhills region feed the Ogallala aquifer, which provides water to Nebraska and seven other states.

One outspoken environmental group appeared to be unmoved by TransCanada's rerouting decision.Noah Greenwald, a spokesman for the Centre of Biological Diversity, said his groupbelieves the pipeline would still pose an environmental threat. The centre hassued the U.S. State Departmentto block the project.

"Even with the reroute, we still feel like we can push forward," he said. "We're going to keep up the public pressure on the administration as this moves forward."

Alberta Premier Alison Redford, who is in Washington to talk upKeystone,reiterated Monday that it is important to respect the regulatory process going on in the U.S.

"Through that process, we've seen communities have concerns," she said in an interview with CBC News. "As as result of that, we now see TransCanada, it seems, making some progress with respect to responding to those concerns.

"That's a good process," Redford said. "That's exactly what we need to have in order to ensure that critical infrastructure can continue to be built to benefit both Alberta and the United States.

Opposition to the Keystone pipeline proposal has grown substantially over the past few months with the help of some high-profileopponents like Robert Redford. The decision to delay a ruling on Keystone allows U.S. President Barack Obama to avoid a potentially divisive environmental issue before the 2012 election.

The proposed 2,700-kilometre pipeline would carry crude oil fromAlberta to Texas Gulf Coast refineries.

Earlier Monday,Redford saidshe was confident that the controversial pipeline project would eventually win regulatory approval in the U.S.