New route for controversial Keystone pipeline nearly done, TransCanada says

BISMARK, N.D. – A Canadian company attempting to build a $7 billion pipeline to carry oil from Canada to refineries along the Gulf Coast soon will have a new route that seeks to allay worries of U.S. regulators, a company executive said Wednesday.

"In a matter of a very few weeks we will have a route that everyone agrees on," said Alex Pourbaix, TransCanada Corp.'s president for energy and oil pipelines.

Pourbaix and Sen. John Hoeven, R-N.D., told North Dakota officials and oil industry representatives that if the 1,700-mile Keystone XL pipeline is not built Canada's oil-sand developers likely would ship the crude to Asia.

"It's going to go to China if we don't build it here," Hoven said.

The U.S. State Department in November delayed a decision on granting a permit for Keystone XL, largely because of worries about the pipeline's environmental impact, especially in Nebraska.

Pourbaix said the Calgary-based company has been meeting with U.S. regulators and officials in Nebraska on mapping a new route that will avoid the environmentally sensitive Sandhills area of Nebraska. He would not elaborate.

President Barack Obama signed into law last month a payroll tax bill that contains a Republican-pushed provision for the president to decide by Feb. 21 whether the pipeline is in the national interest.

The disputed route runs through six states from Canada to Texas. So-called feeder pipelines would connect the Keystone XL to rich oil fields in North Dakota and Montana.

TransCanada announced a year ago that it would accept crude from both states, after facing political pressure by oil companies and officials from North Dakota and Montana who had complained that development of the states' oil patches had been hampered by a lack of refineries, pipelines and rail facilities.

Hoeven said the Keystone XL would carry 100,000 barrels of crude daily from North Dakota and Montana. The pipeline would lessen truck traffic in western North Dakota, while improving prices for crude and creating jobs, he said.