CALGARY

Proceeding with the southern leg of its Keystone XL route reflects TransCanada Pipeline's confidence the rest of the controversial project will be approved by Washington, said company spokesmen.

On Monday, Calgary-based TransCanada announced it intends to begin building its Gulf Coast Project (GCP) - the 765-km southern leg of the Keystone XL pipeline that will extend from Cushing, Okla. to the Gulf Coast.

Because it won't cross any international boundaries, the $2.3-billion route needs no presidential approval but it does need a U.S. Army Corps. of Engineers permit.

And it comes as news the company would be filing a presidential permit application to ensure the remainder of the pipeline proceeds, said president Russ Girling.

"We would expect our cross-border permit should be processed expeditiously and a decision made," said Girling in a statement.

The pipeline's route through Nebraska, where opponents say it would menace crucial aquifers, has twice been delayed by U.S. President Barack Obama.

Pushing ahead with GCP shows TransCanada's confidence in the larger project, said company spokesman Terry Cunha.

"For sure - we've always felt its importance outweighed the concerns," he said.

Premier Alison Redford hailed the announcement as another step towards benefitting both countries' economies.

"This, together with Enbridge's Seaway pipeline, will help close the gap between North American and international oil prices, benefiting Canadian producers and increasing royalties and tax revenues to help pay for health care, education and other public services," said Redford.

Environmentalists, such as the National Resources Defence Council, called TransCanada's Gulf Coast Project decision a show of arrogance and bullying of landowners along its path.

"This is a ploy to avoid a review that will show how the Keystone XL tar sands pipeline will raise U.S. oil prices, send tar sands overseas, endanger U.S. homes and waters, and contribute to worsening climate change," said group's Susan Casey-Lefkowitz.

"What part of 'no' does TransCanada not understand?"

She said the decision will only galvanize resistance to the pipeline among landowners who fear for the environmental integrity of their property.

Though U.S. exports of gasoline have tripled over the past year, pipeline proponents, including TransCanada's Cunha, say GCP will lessen American dependence on imports by improving access Gulf Coast refineries' access to U.S. crude.

"It'll help alleviate some of that bottleneck at Cushing by bringing crude down to the Gulf Coast," said Cunha.

The GCP will create 4,000 temporary jobs, insists the company, which also says it's negotiated 99% of land access in Texas and 100% in Oklahoma.

TransCanada hopes to begin construction in the spring.

bill.kaufmann@sunmedia.ca

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