TransCanada has submitted an environmental report on a proposed revised route through Nebraska for its controversial Keystone XL pipeline.

TransCanada said Wednesday that the new Keystone XL route minimizes the potential impact on the Sandhills region and avoids two small city well fields.

The Calgary-based pipeline operator said the filing reflects feedback both from state regulators and the public. State regulators said the last proposal, submitted in April, was still too close to sensitive areas.

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A 2010 photo shows the Niobrara River in Nebraskas Sandhills region. A new proposed route for the Keystone XL pipeline will avoid the disputed groundwater-rich region. (Nati Harnik/Associated Press)

However, Jane Kleeb, executive director of pipeline opposition group Bold Nebraska, said state and federal officials should reject the proposed route if it would still cross the Sandhills and the Ogallala aquifer.

TransCanada said Wednesday's filing respects timelines established by the Nebraska Department of Environmental Quality and the overall regulatory process for determining a reroute in Nebraska as requested by the U.S. State Department last November.

"The preferred alternative route in this supplemental environmental report was developed based on extensive feedback from Nebraskans and reflects our shared desire to minimize the disturbance of land and sensitive resources in the state," TransCanada president and CEO Russ Girling said.

TransCanada said the report addresses feedback from more than 670 Nebraskans who took part in open house discussions, hundreds of additional comments submitted to state authorities and direct conversations with landowners along the proposed pipeline corridor.

The company said modifications to the route would minimize the impact on sensitive areas known as the Sandhills, along with "additional areas that exhibit similar characteristics to the Sandhills even though they are not identified this way in existing literature or agency databases."

The reroute is also now down gradient of the Clarks Well Head Protection Area, includes fewer areas of wind erodible soils and crosses fewer sloped areas, it said.

Other changes increases the length of the pipeline in the state by some 32 kilometres to a new total length of just over 440 kilometres.

In addition to submitting the supplemental review to Nebraskan officials, the company says it will also provide an environmental report to the State Department on Friday.

The report is required as part of the State Department's review of the company's Presidential Permit application.

The $2.3-billion US pipeline between Oklahoma and refineries on the Texas Coast had been part of TransCanada's Keystone XL proposal to ship Alberta oilsands crude to the Gulf Coast refinery complex.

But the company decided earlier this year to break that project into two parts after the Obama administration rejected it in its entirety — not based on the merits of the pipeline itself but because Republican manoeuvring to speed up the process would not have allowed sufficient time to address ecological concerns in Nebraska.

TransCanada aims to have the Gulf Coast project, which does not need a federal permit to proceed as it doesn't cross an international border, up and running by mid- to late-2013. It has all the approvals it needs from the U.S. Army Corps of Engineers.

Meanwhile, it has submitted a new application for permit to build the northern portion of the pipeline, which would run from the Canada-U.S. border in Montana to Nebraska. TransCanada expects that segment to be in service in late 2014 or early 2015.

With files from The Associated Press