August 31, 2011 / 4:43 PM / in 6 years

UPDATE 2-Nebraska governor asks Obama to nix Keystone pipeline

* Nebraska officials worry pipeline threatens water
    * State Dept expected to issue permit by year-end
    * Montana governor supports Keystone XL

    By Timothy Gardner
    WASHINGTON, Aug 31 (Reuters) - Nebraska's governor has
asked President Barack Obama to block a massive Canada-to-Texas
oil pipeline saying it threatens one of the most important
sources of fresh water in the central United States.
    Governor Dave Heineman, leader of the state known for its
ranching and agriculture, wrote Obama on Wednesday arguing the
proposed path of the Keystone XL pipeline, that will stretch
from Alberta to the Gulf Coast, could damage the Ogallala
    Heineman said TransCanada Corp's Keystone XL
pipeline poses risks to the aquifer he calls the "lifeblood" to
state's $17 billion agriculture industry.
    "I am concerned that the proposed pipeline will potentially
have detrimental effects on this valuable natural resource and
Nebraska's economy," the Republican said in a letter to Obama
and Secretary of State Hillary Clinton and made public to the
    His opposition lends support to a growing environmental
movement against the pipeline, in which hundreds of protesters
have been arrested in front of the White House. But unlike most
of those protesters, Heineman signaled he could support the
line if its route avoided the aquifer.
    The Ogallala is a main source of water for farmlands in the
Midwest. It stretches from Texas to South Dakota and about 65
percent of it lies underneath Nebraska.
    The State Department is expected to decide at the end of
the year whether to issue a presidential permit for the $7
billion pipeline that would bring more than 500,000 barrels per
day of crude from Canada's oil sands. Momentum for Keystone
picked up last week after the department said it would have
limited impact on the environment.
    It said in a review last week that an oil spill from the
line would affect a limited area in Nebraska's Sand Hills
region, which is over the aquifer.
    Nebraska Senator Mike Johanns echoed Heineman's request.
"The proposed route is the wrong route. It's clear to me, after
traveling throughout the state, that most Nebraskans agree a
better route is needed," Johanns said in a release.
    Nearly 700 opponents of the pipeline have been arrested in
front of the White House in an action set to last until the
    Most of those opponents, who include actresses Margot
Kidder and Daryl Hannah, want the line blocked no matter what
route it takes. It is unclear what opponents can do to stop the
project, or change its route.
    Backers of the line say it would create thousands of jobs
and reduce U.S. dependence on oil exporters that are unfriendly
to Washington.
    TransCanada, which hopes to have the pipeline built by
2013, said alternative routes around the aquifer would be worse
for the environment.
    "The proposed route is the shortest and would disturb the
least amount of land and water bodies resulting in reduced
environmental impacts," spokesman Terry Cunha said.
    Montana's Governor Brian Schweitzer has supported the
Keystone project, in part because the line could help relieve a
buildup of oil from his state as drilling techniques open
access to new supplies.
    The State Department will hold meetings in coming months in
the states affected as it considers whether the pipeline is in
the national interest.

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