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Nebraska Would Back New TransCanada Path, Governor Says

Nebraskans would support TransCanada Corp. (TRP)’s planned $7 billion Keystone XL pipeline if it were moved away from a water aquifer, the state’s Republican Governor David Heineman said.

“I’ll stand up for that,” Heineman said today in an interview on “InBusiness with Margaret Brennan” on Bloomberg Television. ‘So will most Nebraskans.’’

The proposed route crosses the Sandhills region of the Ogallala aquifer, which supplies drinking water to 1.5 million people. The 1,661-mile (2,673-kilometer) pipeline would deliver 700,000 barrels a day of crude from Alberta to the Gulf of Mexico by crossing Montana, South Dakota, Nebraska, Kansas, Oklahoma and Texas.

Nebraska lawmakers began committee hearings today in Lincoln, the state capital, on five bills on the pipeline during a special legislative session called by Heineman. While the governor hasn’t offered his own measure, he said he’d back a project along the route of an existing TransCanada pipeline further east that avoids vulnerable areas of the aquifer.

President Barack Obama acknowledged the state’s concerns last week, saying jobs from the project wouldn’t be worth the risk of contaminating drinking water. TransCanada Chief Executive Officer Russ Girling has said rerouting delays might kill the Calgary-based company’s $7 billion project.

“You can’t ask us to change the route and act like it’s just changing an order on a menu,” Shawn Howard, a TransCanada spokesman, said in an Oct. 25 telephone interview. “This is what professional activists who have been opposing Keystone want. They want to delay, to tie it up through legal means.”

Shallow Water Table

One measure under consideration would give the state’s Public Service Commission authority to approve or deny pipeline routes. If passed, the Major Oil Pipeline Siting Act would take effect immediately and apply to the Keystone XL path.

The project as proposed would cross an area with a shallow water table and porous sand that make it susceptible to contamination, according to John Gates, assistant professor of earth and atmospheric sciences at the University of Nebraska in Lincoln.

“We’re simply asking why would you put it over the Ogallala aquifer and risk an oil spill or an oil leak?” Heineman said.

Final Say

The State Department, which has jurisdiction over the pipeline because it crosses an international border, has said the project will cause “no significant” environmental damage provided TransCanada complies with U.S. law and follows recommended safeguards. The department has said it expects to make its decision this year.

In a Nov. 1 interview from the White House with television station KETV, Obama acknowledged the concerns of Nebraskans and indicated he will have final say over whether to approve the pipeline.

“Folks in Nebraska, like all across the country, aren’t going to say to themselves, ‘We’ll take a few thousand jobs if it means our kids are potentially drinking water that would damage their health,’” Obama said. “We need to make sure that we have energy security and that we aren’t just relying on Middle East sources. But there’s a way of doing that and making sure that the health and safety of the American people and folks in Nebraska are protected.”

While the decision will be made at the State Department, the determination “will reflect the president’s views,” White House press secretary Jay Carney said today at a briefing.

The Nebraska Legislature, which is officially nonpartisan and has one chamber with 49 senators, will weigh two similar bills tomorrow and Nov. 9. Bills that pass out of committee will be debated by the entire legislature.

Thousands of protesters in Washington surrounded the White House yesterday, urging Obama to reject Keystone XL because, they say, it will encourage further development of Canada’s oil sands, which lead to greater emissions of greenhouse gases than many other types of crude.

To contact the reporters on this story: Jim Efstathiou Jr. in New York at jefstathiou@bloomberg.net; Bradley Olson in Lincoln, Nebraska at bradleyolson@bloomberg.net

To contact the editor responsible for this story: Larry Liebert at lliebert@bloomberg.net

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