March 7, 2014 Dear President Obama and Secretary Kerry, As Nebraska Sandhills natives and lifelong neighbors, we are

writing to you to inform you that Nebraska citizens and landowners oppose the proposed Keystone XL tarsands pipeline and oppose the pipeline’s proposed route through our state. This export pipeline is neither in Nebraska’s nor in our national interest. There currently exists no legally-sited, publicly approved route for this pipeline through the state of Nebraska. Any action taken to evaluate the Nebraska route currently described in the State Department’s Final Environmental Impact Statement (FEIS) will be a waste of time, effort and resources since the only legally approved entity to site a pipeline in our state—the Public Service Commission—has yet to see a route from TransCanada. The PSC can alter the route, which means current information under review for Nebraska can all be changed. We believe the President has enough information to deny the pipeline. Any attempt to approve the pipeline will be met with legal hurdles because over 250 miles of the route is currently not approved by the state of Nebraska. Contrary to statements made by our governor, the people of Nebraska have not received fair treatment in our state process, and the results of that unconstitutionally established state process are inaccurate and invalid. Our requests for unbiased information at both the state and federal level continue to be ignored. We call on you to deny the permit for this unnecessary export pipeline that will risk our land, water, and livelihoods while enriching private, foreign corporations at our expense. First, we would like to make it known very clearly that there is currently no legallyapproved route for this pipeline project through the state of Nebraska. On February 18, 2013, Lancaster County District Court Judge Stephanie Stacy ruled that Nebraska’s law LB1161 was unconstitutional and declared that the route identified by the process established by that law is null and void. There is no route for this pipeline in Nebraska. The Nebraska route discussed in the FEIS is no longer applicable to this project and should not be evaluated as part of the FEIS. The FEIS is now incomplete and inconclusive, and the pipeline permit should be denied; however, we would like to comment on portions of the FEIS in order to make our concerns part of the public record. We would like to thank the US State Department for acknowledging some of the issues we previously presented as reasons why the proposed Keystone XL route is unacceptable to Nebraskans. We sincerely appreciate the State Department recognizing these issues in the FEIS, and as documented in the FEIS we would like to discuss these points in detail.

March 7, 2014

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Impacts on aquifers from a leak or spill would be virtually immitigable. Although TransCanada claims that these spills would be “localized,” no studies have been conducted on a major-sized or worst-case-scenario accident in the Ogallala aquifer. “Localized” is a relative term that means little to landowners, citizens and communities whose drinking water would be impacted greatly by even a pinholesized leak from a pipeline of this capacity.

It is negligent of the State Department to tie impacts to water with distance from a spill, while not taking into consideration the 2,398 wells of Nebraskans that are within one mile of the proposed pipeline route. The FEIS specifically states that when a spill happens the impacts will correlate with the distance from water, people, livestock, soil, and other natural resources. The State Department only studies a spill of 20,000 barrels and even with that spill size states a “localized” spill could spread ! a mile. The ONLY peer-reviewed study of a worst-case scenario—which is 150,000 barrels (i.e. 1.5% leak for 14 days)—conducted by Dr. Stansbury states a chemical plume from that spill size could travel for miles. A spill in a family’s water well or moving water like in the Platte or Niobrara river would be devastating and is not studied properly in the State Department report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urthermore, the State Department is still using outdated spill information from the Bemidji aquifer study. Due to the Bemidji site being glacial outwash, the permeability will be lower than the sandy aquifers beneath the pipeline route. Support of the inadequacy of this study is found on page 3.3-29 where the report references localized preferential flow paths, which could enable dissolved chemicals to move at an increased rate through the unsaturated zone to the water table.

March 7, 2014

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In section 3.13, the FEIS discusses potential releases from pinhole leaks noting that they could form from damages to the protective coating because of the pipeline being exposed to moisture, which would then lead to corrosion. Noting when moisture connects with metal electric currents flow naturally between the soil and pipeline, which could induce the pipeline metal to combine with oxygen, resulting in rust. The effects of these circumstances could excessively increase with scratches or holes in the pipeline coating (Beavers and Thompson 2006). To consider the implications of the pinhole leaks we ask the State Department to take into consideration the 835,000 barrels of diluted bitumen the proposed export pipeline will carry per day and TransCanada’s touted safety mechanism that will supposedly detect 99% of this volume. This means 8,350 barrels of diluted bitumen could leak into 78 percent of the public water supply and 83 percent of irrigation water of Nebraskans on a daily basis (Emmons and Bowman 2000). In addition, as found on page 3.3-10 of the FEIS, the diluted bitumen would move at a rate of approximately two square foot miles per day all the while being one mile from 2,398 wells of Nebraskans. This is unacceptable and Nebraskans demand that the proposed export pipeline route around our invaluable water supply. The Niobrara River is one of Nebraska’s most pristine rivers; before an export pipeline is placed in the corrosive soils of its riverbed the State Department as well as landowners bordering the river should have a clear understanding of the consequences and interactions of the pipeline with corrosive soils. Additional corrosive soils are found in the Verdigre Creek bed near Royal, Ne. The Verdigre Creek is the only Class A coldwater fishery in eastern Nebraska, supporting a thriving trout population. Like the Niobrara River, this major tourist attraction in eastern Nebraska should not be jeopardized without a complete understanding of the interactions of corrosive soils with the pipeline while taking into account the consequences that could potentially devastate the invaluable trout population in the Verdigre Creek watershed due to pinhole leaks. We agree with the Nebraska Game and Parks and Trout Unlimited, the proposed export pipeline should avoid the Verdigre Creek watershed. • The proposed “Nebraska Reroute” detailed in the FEIS does not avoid the Sandhills and still crosses the High Plains Aquifer, including the Ogallala Group. The current TransCanada and NDEQ-defined Sandhills are an inaccurate portrayal of soil and groundwater conditions along the proposed route. The state of Nebraska used a wildlife eco-region map, not a soil map to define the Sandhills. (See Appendices A-E).

Nebraskans have repeatedly said the Keystone XL pipeline still crosses the Ogallala Aquifer and Sandhills, the FEIS released by the State Department confirms what Nebraskans have been saying all along. The map on page 3.3-23 of the FEIS best supports this statement showing the route still crossing the Sandhills and the Ogallala Aquifer. As we noted in our previous letter, this is the map that TransCanada submitted with its permit application in 2008.

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In section 1.2 of the report, the State Department also acknowledges that the Sandhills identified by the Nebraska Department of Environmental Quality (NDEQ) and terms them the “NDEQ identified Sandhills.” As detailed in our previous letter, this process was completely flawed whereby TransCanada persuaded the NDEQ to use an ecoregions map to define the Sandhills boundary. As the State Department can appreciate, an ecoregions map is insufficient to protect specific characteristics, because there are several characteristics that determine an ecoregion. In fact, one of the ecoregions map cartographers, James Omernik ,i made it clear that the ecoregions map was never intended to be a source for pipeline siting but instead intended for general ecosystem management. Omernik told Inside Climate, a news organization following the pipeline closely, “If you're only looking at the hydrologic characteristics, that wouldn't be the same as the Sandhills boundary, if people are interested in a specific [factor], then they need to look at that specifically." The FEIS supports the reasons why the ecoregions map is insufficient for designating the Sandhills on page 3.2-5, explaining the soil characteristics of the NDEQ-identified Sandhills fall outside of this region. In northern Nebraska, the proposed Project route in Boyd, Holt, and Antelope counties would enter an area where the soils tend to be highly susceptible to erosion by wind and often exhibit characteristics of the NDEQ-identified Sand Hills Region (i.e., fragile soils [see Figure 3.2.2-2]). The report further states on page 3.2-6 that the sandy soils, typical of the NDEQ-identified Sand Hills Region, have a high infiltration rate and high permeability; however, the fine-grained loess deposits further to the east can be as thick as 200 feet and can locally restrict water flow where fractures are absent (Stanton and Qi 2007, Johnson 1960). The FEIS sites the same USGS source that Nebraskans used to back up their soil sample data, which they paid for at their own expense, and presented to the NDEQ as evidence to show sandy permeable soils existing beyond the NDEQ identified Sandhills. In support of the inadequacies of the route still crossing the Ogallala Aquifer; the FEIS states on page 3.2-28 that much of the proposed Project area in Nebraska overlies the NHPAQ system, which supplies 78 percent of the public water supply and 83 percent of irrigation water in Nebraska (Emmons and Bowman 2000). While discussing key aquifers on page 3.2-28 the FEIS says the pipeline would immediately overlie 98 miles of the Eastern Nebraska Unit, 88 miles of the Ogallala Formation, 16 miles of the Platte River Valley Unit, and 72 miles of the Sand Hills Unit (see Figure 3.3.2-4). On page 3.2-29, the FEIS notes that in northern Holt County and through most of Nance County, the proposed pipeline area is again underlain by the NHPAQ system (Sand Hills Unit over the Ogallala Formation). Therefore, as Nebraskans have been saying all along and the FEIS validates the Keystone export pipeline still crosses the Ogallala Aquifer and the fragile porous permeable soils of Nebraska.

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The proposed Nebraska Reroute crosses many areas of fragile soils in Northern Nebraska (See Appendices B and H). o The reroute crosses 94 miles of the Sandhills (before the NDEQ used an inadequate map of the Sandhills that shrunk the region), without including Keya Paha County and the Nebraska Entry Point. ! The previous (denied) route crossed 92 miles of the NDEQ/TransCanada Sandhills without Keya Paha County and the Nebraska Entry Point. o The reroute crosses 109 miles of the NDEQ-defined Sandhills, when including Keya Paha County and the Nebraska Entry Point. o The previous (denied) route crossed 110 miles of the NDEQ/TransCanadadefined Sandhills when including Keya Paha County and the Nebraska Entry Point.

While discussing soils on page 3.2-5, the FEIS once again confirms what Nebraskans have been saying, by describing the soil composition of the northern counties Keya Paha, Boyd, and Holt as having soils, which are generally sandy, very and excessively drained to somewhat poorly drained. Classifying Holt and Boyd counties as a Tableland Resource Area where soil types are silty or sandy loam soils. Moving southward the FEIS reports the soils in Antelope and Boone counties as a Loess Uplands Resource Area, where the soils are more susceptible to erosion if unvegetated. The report describes the soils in northern Antelope County as sandy loams, which are frequently layered with very fine-grained ash layers susceptible to erosion by rain and wind. On page 3.2-6, the FEIS discusses soil erosion in more detail saying that the proposed Project route would cross approximately 48 miles of highly wind erodible soils in Nebraska (see Table 3.2-1). The FEIS best summarizes the issues of the proposed export pipeline still crossing the fragile soils in northern Nebraska on page 3.2-5; stating the proposed Project route in Boyd, Holt, and Antelope counties would enter an area where the soils tend to be highly susceptible to erosion by wind and often exhibit characteristics of the NDEQ-identified Sand Hills Region (See Appendix H). • Agricultural operations affected by the construction will be permanently damaged, with the most drastic effects seen on irrigation systems and cattle grazing systems.

On page 4.2-2, the FEIS states that 40% of the total acreage of prime farmland soil would have direct impacts by construction of the proposed pipeline (see Figure 4.2.1-1). Given that 64% of the route in Nebraska is prime farmland, Nebraskans will clearly be the most impacted. In section 4.2.3.1, the FEIS acknowledges the impacts on farmland during construction. The report explains the impacts of construction activities as clearing, grading, trench excavation, backfilling, equipment traffic, and restoration along the construction right of

March 7, 2014

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way that could adversely affect soil resources. Going on to further say that the construction of pump stations, pipe yards, valve sites, access roads, temporary work areas, and construction camps could also affect soil resources. Adding to this, the report states farmers could endure additional impacts from temporary and short-term soil erosion, loss of topsoil, short- to long-term soil compaction, permanent increases in the proportion of large rocks in the topsoil, soil mixing and short-term to permanent soil contamination. With the pipeline route already crossing highly erosive soils and high water tables, it is a given that Nebraska farmers and ranchers will endure these hardships with more substantive consequences. According to the FEIS, farmers would undergo additional impacts to their tile drainage systems and irrigation systems. Other difficulties farmers will face are with the compaction of soil are from the grading and equipment traffic, which would result in reduced porosity of the soil and percolation rates as well as an increased potential for runoff. In addition to the abovementioned impacts, farmers and ranchers will also have to rethink their farming and grazing methods for managing the vulnerable soils in these sensitive areas. The suggested mitigation measures will compromise the way farmers and ranchers manage their land. For example, fencing off areas of the right of way could alter grazing patterns or methods, and or accessibility to water which in turn could affect erosion patterns of the land. Supporting this is a recent conversation a landowner had with TransCanada, whereby the property owner was told to winter pasture their heifers somewhere else for the reason that TransCanada did not want to pay for an easement area that is used for a dual purpose such as a hay meadow and winter pasture. So, a property owner who is effectively managing their land insomuch they are able to use it for multiple purposes, is being told by a foreign corporation that they need to find a different place to winter pasture? As another supporting example, at a recent meeting in York, NE the owner of Pivot Doc irrigation said that several farmers along the proposed pipeline route have contacted him about installing reverse irrigation systems. This is an added expense to the property owner; he also went onto say that a drip irrigation system would not be a viable option, as it would have to cross the easement area. He also provided insightful comments about benzene getting into the water supply, and said there isn’t one irrigation company in Nebraska that supports the pipeline, once the water gets contaminated they are all lose their jobs. As the examples listed above and the FEIS details, there are clear impacts to agriculture operations including prime farmland, irrigation and grazing systems. With an increasing demand for agriculture land, why should any of this land be sacrificed for an export pipeline?

March 7, 2014

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Construction and operation of the proposed Keystone Export pipeline, due to the lack of mitigation and commitments from TransCanada place Nebraska’s agriculture economy, drinking water, and natural resources at serious risk.

As discussed in the FEIS on page 3.2-6, 64% of the proposed route in Nebraska will cross prime farmland. Additionally, the pipeline will come within 1 mile of 2,398 drinking wells in Nebraska, in comparison to 523 in Montana and 105 in South Dakota, 3.3-30. Of the 2,398 wells impacted in Nebraska, 1,115 of them are classified as shallow or very shallow in comparison to South Dakota having a mere 75 wells in this classification. As stated on page 3.2-28 of the FEIS much of the proposed Project area in Nebraska overlies the NHPAQ system, which supplies 78 percent of the public water supply and 83 percent of irrigation water in Nebraska (Emmons and Bowman 2000). The FEIS also acknowledges the transmissivity of the Ogallala Formation, noting on page 3.3-20 that it typically ranges from 2,000 to 10,000 square feet per day. In other words, carcinogens could move through the water resources Nebraskans depend upon at the rate of two miles or more per day. Therefore, as Nebraskans having been saying and the FEIS confirms Nebraskan’s agriculture economy, drinking water and natural resources are indeed at risk with TransCanada’s proposed pipeline route. Again, we thank the State Department for addressing the abovementioned issues in the FEIS and acknowledging what Nebraskan’s have been saying all along concerning the proposed Keystone pipeline unnecessarily risking their land, water and livelihoods. • The economic benefits advertised by TransCanada do not match independent research and analysis, nor do TransCanada’s advertised employment figures match the actual numbers submitted by TransCanada to the State Department. This project will only create 35 permanent jobs nationally, but will directly affect the livelihood of hundreds of family farms and ranches in Nebraska alone.

On page 4.10-5, FEIS estimates the proposed project would create 35 permanent employees and 15 temporary contractors once the pipeline enters into service. However, the FEIS fails to take into account the livelihoods of family farms and ranches in Nebraska at risk. According to an annual UNL survey in 2012-2013, the average acre of farmland in Nebraska is approximately $6250. The proposed project is slated to cross 274 miles of Nebraska’s most vulnerable soils with a 50ft easement, crossing 175 miles of Nebraska’s prime farmland. This equates to 46,200,000 square feet of affected prime farmland. The land value alone of directly affected acres of prime farmland equals $6,628,787.88. This direct land value and does not consider impacts outside of the easement area, gross production yields, land improvements, or the appreciation of prime farmland. These are the numbers the State Department should be crunching while evaluating the economic impacts of the proposed export pipeline. The speculated menial thirty-five

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jobs from this proposed project should not be a factor in the economic argument of this export pipeline the risks to the livelihoods of farmers who depend upon the land everyday to feed American families is the argument that should be at the forefront of economic impact not 35 jobs. 175 milesx5,280ft = 924,000ftx50ft= 46,200,000ft^2 of prime farmland affected 1 acre = 43,560ft^2 46,200,000ft^2 / 43,560 ft^2 = 1,060 affected acres of prime farmland 1,060 acres x $6250/acre = $6,628,787.88 approximate value of affected prime farmland (http://agecon.unl.edu/c/document_library/get_file?uuid=411be68c4ef5-4d73-b2bd-a51e657e3cc5&groupId=2369805&.pdf). • There is no state requirement that TransCanada compensate farmers and ranchers for economic damages, and easements with landowners contain no such safeguards against economic damages as a result of future problems with the pipeline.

TransCanada continues to refuse to modify its easements to provide absolute indemnification against all losses or claims and expenses arising from pipeline operations, oil spills, or operational failures except those that arise from intentional willful acts of landowners. In fact, landowners who sign early in order to receive a “bonus” assume all of the risks during the construction and survey process. Additionally, TransCanada has concealed its intention to abandon the pipeline at the end of its useful life. In section 2.1, the FEIS states that Keystone used a design life of 50 years to develop the engineering standards for the proposed Project, but anticipates the life of the proposed project being much longer. The entire safety analysis is based on a 50 year design life, though TransCanada anticipates it will last much longer, this is very worrisome from a safety perspective. Furthermore, the FEIS states that TransCanada does not typically abandon largediameter pipeline, but instead the pipeline can become idle or deactivated and then eventually converted to another purpose. If the safety analysis is based on a 50-year design life, TransCanada should not be allowed to operate the pipeline beyond 50 years nor convert it to an alternate purpose. The pipeline should be terminated and decommissioned by TransCanada at the conclusion of the expected safe operation period of 50 years. Because of the uncertainty surrounding the design life beyond the 50-year safety analysis, TransCanada should not be allowed to transfer the easement to a new owner where an alternate substance or operation protocol could potentially compromise the integrity of the pipeline. More concerning is a statement the TransCanada recently made to a landowner, where they provided no guarantee the easement would not be sold to non-US Company.

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Annual local property taxes will be at their highest value for the first full year of valuation only. After that, those tax revenues will depreciate over a sevenyear period, leaving the pipeline untaxed and generating no revenue for the remainder of the useful life of the pipeline.

In 2012, property taxes for the current Keystone pipeline in Nebraska peaked at $7.66 million. In 2013, that number dropped by almost a million dollars to $6.68 million. Meaning taxes collected in counties for the pipeline have gone down $1million in just one year. The highest single-county tax revenue total was $1.26 million in Stanton County, and was an average of $984,421.23 for all counties crossed by the pipeline. • The FEIS fails to compare property tax revenues from the pipeline to property tax revenues from other energy projects. The FEIS also fails to address economic damages caused by operational failure of pipeline.

The FEIS states: “This impact to local property tax revenue receipts would be substantial for many counties, constituting a revenue impact of 10 percent or more in 17 of the 27 counties that the proposed pipeline would affect. Operation of the proposed Project is not expected to have an impact on residential or agricultural property values JKeystone FEIS, Section 4.10.1, p, 4.10-5M$W Nebraskans know that clean, renewable energy has the potential to boost our rural economy and create more permanent jobs in our state than this pipeline ever will. A 2013 study of rural Nebraska counties showed:
• • •

The impact of one, 200 MW wind farm to be $1.3 million annually in revenue This could increase property tax revenue in some counties by about 40% Up to 75% of those increases go into the school system
Source: “Impact of Wind Energy on Property Taxes in Nebraska,” by Bluestem Energy Solutions and Baird Holm Attorneys at Law, November 2013. Click here to download a copy of the report.

Nebraskans also know that having a pipeline on their property will most certainly affect their property values, and can affect their ability to secure affordable insurance, operating loans, and can inhibit sale of their properties. Farmers and ranchers have the most to risk when a pipeline spill occurs, and in the easements that TransCanada is requiring landowners to sign, TransCanada has no liability to compensate farmers for economic damages in the event of a spill. It is landowners and citizens along the route that have the most at risk with this project, with little reward. Our communities stand to benefit far greater from American-made clean, renewable energy that keeps young people in rural areas and benefits our local economy. Farmers and ranchers along the route know that they have much to lose by allowing a foreign export pipeline on their property, and the easements TransCanada is requiring landowners to sign do not fairly account for the risks to future property owners in our state.!

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Throughout NDEQ’s evaluation process, the concerns of Nebraskans were ignored and many of our questions remain unanswered. NDEQ and TransCanada have not implemented any suggestions made by those who would be most affected and whose property and livelihoods would be most at risk. Our Governor, our Senators, and a majority of our House members have instead chosen to side with a foreign corporation against the best interest of Nebraska citizens.

Overall, the NDEQ review failed to accomplish its main goal, which was to route the pipeline away from the Sandhills, as the FEIS confirms. Furthermore, the NDEQ failed to review the entire route of the pipeline through Nebraska and instead just reviewed the rerouted portion, which by definition is an incomplete review. Another major concern is the clear conflict of interest in choosing HDR as the contractor to prepare the NDEQ route review report. We discuss this in detail in section 1.78 of this Citizen's Review of the NDEQ report. HDR is a consultant on a joint project sponsored by TransCanada and Exxon Mobilii, and has numerous other ties to tarsands and TransCanada. Additionally, HDR is relying on biased information from companies like the Perryman Group for the economic study of the pipeline. The Perryman Group was hired by the American Petroleum Institute and TransCanada to prepare this one-sided economic view of the project. If studies from biased entities such as the Perryman Group and Consumer Energy Alliance are going to be used in this critical process, then it is only fair that reports from the nonprofit and academic fields NOT tied to the oil industry are also used. Additionally, the NDEQ Report incorrectly refers to the substance to be transported by the Keystone XL export pipeline as “crude oil.” This is an incorrect referral, as the substance to be transported by the pipe will be diluted bitumen or other bitumen-derived substances, as described in the Draft DEQ Report in Chapter 6. Furthermore, because no Material Safety Data Sheets (MSDS) or specific ingredients/chemicals/compounds lists have been released to the public about the exact substances to be transported, NDEQ has incomplete knowledge about this massive 36inch pipeline and its impact on the natural resources of Nebraska. Additionally, as noted in the FEIS, the EPA’s “Ecoregions Map” used to define the Sandhills is inadequate and is inconsistent with other maps, including the USGS map used by TransCanada in its application to the State Department and shown as part of the official Keystone XL Environmental Impact Study (EIS). In 2011 Governor Heineman in his request to President Obama to deny the pipeline permitiiidemanded the pipeline avoid the Ogallala Aquifer, the backbone to our agricultural economy. Yet, on Jan 22, 2013 Governor Heineman approved the route under LB 1161, this route still recklessly crosses the Sandhills, sandy soils, and the Ogallala Aquifer. We remind the State Department that the law granting Governor Heineman authority to approve the route was ruled unconstitutional and the route was declared null and void.

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TransCanada has never released an Emergency Response plan, including the full and complete MSDS for pipeline contents, to local first responders or landowners for the Keystone 1 route in Nebraska. Vital information about the contents of the pipeline has been withheld from first responders. In the event of a spill, emergency personnel and health care providers would not have the knowledge necessary to do their jobs until after a spill had occurred.

The FEIS only gives representative MSDS information, and Appendix Q of the FEIS states that those MSDS “do not represent the actual product that would flow through the Keystone XL pipeline (p.1). Calls made to listed first responders on TransCanada’s Keystone 1 line revealed that the plans are not in place, and emergency personnel are not trained. • TransCanada would have no financial responsibility beyond an inadequate insurance policy in the event of a major spill or leak associated with the Keystone Export pipeline. Because diluted bitumen is not classified as oil, TransCanada does not pay into the Oil Spill Liability Trust fund, which is used to cover cleanup costs. TransCanada will be using American taxpayers to subsidize their cleanup costs. TransCanada’s advertised, not actual, $200 million in third-party liability insurance to cover cleanup costs is inadequate for a major spill. Cleanup of major spills, such as the one in the Kalamazoo watershed in Michigan, can cost almost a billion dollars and still be inadequate. We have no proof this $200 million insurance policy is in place and in fact TransCanada told some leaders in our state that they are no longer providing that coverage because they are now “avoiding the Sandhills.”

Consider the 20,600 barrels of oil spilled in 2013 from a Tesoro pipeline in Tioga, North Dakota, where cleanup is expected to take two more years and the spill is nowhere near an aquifer, river or stream. Not only is this farmer being impacted by the cleanup costs of the spill but also the loss of production yields compromising his farming operation and practices. The farmer will undergo these hardships for at least three years, provided he is able to ever restore the land and reap the same production yields. The North Dakota oil pipeline spill has percolated into the ground to a depth of 30 feet where the water table is 150 feet below the surface; much of the route in northern Nebraska will cross areas where the depth to water is less than 30 feet below the surface. The cost of cleaning a tarsands spill in Nebraska will be well beyond TransCanada’s advertised $200 million third-party liability insurance and would likely exceed the billion dollars of the Kalamazoo watershed clean-up in Michigan due to the proximity of the water to the surface and impacts to the Ogallala Aquifer, surface, and ground water.!!! ! A top concern of farmers and ranchers on the pipeline route are the effects of the pipeline operation on soil temperature and on grass/crop productivity. While the FEIS addresses this issue in its Appendix S, it also admits that there has been little research

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done on the effects of increased soil temperature near pipelines. The research on which the FEIS discussion is based was done on natural gas pipelines in Canada. No information was utilized that had been gathered as a result of studying diluted bitumen pipelines in the United States or in Nebraska. The Keystone 1 pipeline is a diluted bitumen pipeline that runs through many of the same states as the proposed Keystone XL pipeline. Why has no study been performed on soil temperatures along the Keystone 1 route? Not doing so is neglecting an obvious opportunity to utilize more accurate information and obtain updated information regarding diluted bitumen pipelines. After our comprehensive review of the FEIS, we would like to bring some additional issues to the State Department’s attention further supporting why the permit for the Keystone export pipeline should be denied. There is no discussion in the FEIS concerning corrosive soils. Though the report mentions pinhole leaks that could form in the pipeline due to scratches or pitting to the protective coating or the pipe encountering moisture it does not mention possible implications of the pipeline interacting with corrosive soils. We remind the State Department that according to page 3.2-28 all 274 miles of the pipeline route will overlie the NPAHQ system, 98 miles of the Eastern Nebraska Unit, 88 miles of the Ogallala Formation, 16 miles of the Platte River Valley Unit, and 72 miles of the Sand Hills Unit (see Figure 3.3.2-4). Consequently, the pipeline will most definitely encounter “moisture.” In terms, of the corrosive soils, we have attached maps from the NRCS, showing the locations of these soils in two of the most sensitive areas on the proposed pipeline route see Appendix (G) and Appendix (H). We did not ask the NRCS to analyze corrosive soils along the entire route, but instead focused on these two vulnerable areas, that are also special scenic attractions in Nebraska. As stated above, the pipeline is already susceptible to pinhole leaks due to imperfections with the protective coating. Has the State Department conducted any studies on how the protective coating behaves in corrosive soils? TransCanada recently told a landowner that when they abandon the pipeline it will be flushed, federally inspected and then filled with concrete so that it did not collapse when it rusted out. TransCanada is already admitting that the pipeline will rust in current conditions let alone the implications of the pipeline sitting in corrosive soils this needs further evaluation and consideration. We would also like to bring to the State Department’s attention Pump Station 24 in Nance County, which will be sitting between two designated wetlands. The FEIS notes on page 3.3-50 that pump Station 24 in Nance County may be inaccessible during periods of flood. Further noting that most if not all access roads to Pump Station 24 will cross significant flood plain areas associated with the Loup River and Prairie Creek systems; if both are experiencing flood events, Pump Station 24 could be inaccessible. This is appalling from the perspective of inaccessibility, but also the amount of dirt work this area will require to build a pumping station on the flood plain. Additionally, in order

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to build the pumping station the Lower Loup NRD would have to allow TransCanada to stop the natural flow of the water drainage between the two wetlands. The NRD cannot do this because the water is traversing between the two wetlands and the NRD would be inhibiting its natural flow. As we close what we know is a long and detailed letter, we want to emphasize the risk to our water. The fact that there are 2,398 wells within one mile of the pipeline route, this is unacceptable. Nebraskans will not sit idly by and let 78 percent of our public water supply and 83 percent of our irrigation water be tainted with undetected carcinogens. Comparing the number of affected wells within one mile of the pipeline route to surrounding states South Dakota has 105 and Montana 523, it is clear Nebraskans are risking the most. As Nebraskans have voiced over the last five years and the FEIS confirms, the pipeline will virtually sit in our water while 1% of the 835,000 barrels of diluted bitumen leak undetected carcinogens into our drinking and irrigation water. Nebraska has four times as many wells as any other state within one mile of the pipeline and 1,115 of these wells are documented in the FEIS as being shallow or very shallow. The FEIS also fails to address the very important Nebraska issue of surface and groundwater connectivity. In 2011, University of Nebraska-Lincoln scientists Dr. John Woldt and Dr. Wayne Gates urged the State Department to consider “the abundant interaction between groundwater and surface water” in Nebraska. Because lakes and streams in the Sandhills are fed “almost exclusively by groundwater,” they wrote, “risks are not limited to the aquifer, but extend to surface water as well.” Although the State Department report acknowledges that there “are 281 waterbody crossings along the proposed Project route in Nebraska, including 31 perennial streams, 237 intermittent streams, eight canals, and five artificial or natural lakes, ponds, or reservoirs,” only five rivers in Nebraska would be crossed using horizontal directional drill construction—the safest method for crossing waterways (3.3-43). Highly sensitive bodies of water like Verdigre Creek, one of the only trout streams in Nebraska, will not be afforded special crossing consideration. Both the Nebraska Game and Parks and Trout Unlimited have called for the crossing of this watershed to be avoided—or at the very least crossed using horizontal directional drilling—but the State Department report does not address this risk at all. We would also like to discuss briefly another point not noted in the FEIS, the link between climate change and clean drinking water. As Secretary Kerry recently said, climate change could be considered another weapon of mass destruction, and perhaps the world’s most fearsome weapon. We couldn’t agree with you more and that is why we are asking you to deny the Keystone XL pipeline permit. We also agree that as you stated in this same speech, we all have a moral responsibility to leave future generations with a planet that is clean, healthy, and sustainable.

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The Keystone XL pipeline permit is a step backwards, polluting some of the world’s most valuable natural resources that will support a sustainable future for the next generation. President Obama agrees, while addressing the drought in California he stated that we must do a better job of ensuring everyone’s water needs are satisfied. The Keystone XL pipeline will cross 78% of the public water supply in Nebraska and come within 1 mile of 2,398 wells. Climate change results in extreme weather patterns and conditions where clean water becomes one of the most invaluable resources to mitigate these conditions. Therefore, maintaining a clean drinking water supply should hold as much merit as climate change in this argument. Climate change disasters increase the need for clean drinking water, thus maintaining the quality and quantity of this invaluable resource becomes of utmost importance. None of the 281 water body crossings in Nebraska or the Ogallala Aquifer are worth risking for an export pipeline; we must think to the future and leave pure sustainable natural resources for the next generation$!!! In this time of extreme drought where every ounce of water has to be conserved, we are concerned with the amount of water that TransCanada requires for construction. We know through a FOIA document request that with just one part of Hydrostatic Test Discharge that TransCanada used over 14 million gallons of water from a “well” which was not identified in the paperwork on file with the DEQ. TransCanada had to get a permit from DEQ to put that water back into the ground. The FEIS confirmed that

water withdrawals for hydrostatic testing require no consultation if they return the water to the same drainage basin within 30 days, and there is no testing that water for contamination (FEIS 3.3-48).
Regarding mitigation measures, no matter what measures are agreed to in this planning stage, there is no state-level oversight and no consequences (e.g. fines, legal recourse, etc) mentioned for not following the Construction, Mitigation and Reclamation Plan that TransCanada/Keystone has given the State Department. TransCanada/Keystone can write the most meticulous details on mitigation and can run the most convincing ads, but there is no way a landowner can be sure that these measures and promises will be carried out. Specifically: • • • There is absolutely no accountability for TransCanada/Keystone to follow their mitigation measures. There are no fines and there are no penalties if the mitigation is not done according to the plan that TransCanada/Keystone has submitted. Much of the mitigation work seems as though it is being done by subcontractors which raises the question if TransCanada is still responsible and liable for the work of the subcontractors. Or are the pages and pages of contractor commitment forms and engineer certification forms just a way for TransCanada/Keystone to avoid responsibility similar to the way TransCanada avoided responsibility of when their

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subcontracted land agents were bullying landowners? We have lots of “shoulds” and “mays” in this report. We need more “will” and “required.”

As stated in the Citizens’ Review of the NDEQ Final Evaluation Report, TransCanada has provided no assurances to the State of Nebraska that they will implement adequate mitigation measures. They have ignored citizens’ requests to test domestic and livestock wells within 1000 feet of the centerline of the route, they have failed to provide emergency responders with the information they need to do their jobs, and they have no legal or financial responsibility to protect or compensate landowners and citizens in the event of a major spill causing economic damages. The FEIS reports that TransCanada will only be required by the NDEQ to test wells within 300 feet of the pipeline, which is an inadequate distance and should be increased to at least 1000 feet. We hereby call on you to deny the permit for the Keystone Export pipeline, which would violate the rights of Nebraska citizens and is contrary to the national interest. We refuse to risk our land, water and economy for the profits of a foreign corporation that mistreats landowners and disregards our concerns. We request that the Nebraska Evaluation be removed from the Department of State’s Final Environmental Impact Statement and be replaced with an independent evaluation that takes into consideration the many concerns of Nebraskans whose lives will be directly affected by this pipeline. We appreciate your sustained attention to this matter in recent years. Please do not turn your back on us now. Sincerely, Benjamin D. Gotschall, on behalf of Bold Nebraska 6505 West Davey Road Raymond, NE 68428 Amy A. Schaffer, on behalf of Nebraska Easement Action Team (NEAT) P.O. Box 114 Louisville, Nebraska 68037 Nebraskans submitted almost 10,000 comments in this last 30-day period and thousands more through out this process. We hope our concerns are heard and acted upon to reject this risky permit. Appendix A through I follow on the next 10 pages

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Appendix A: NDEQ Environment Regions before and after negotiations with TransCanada Nebraska DEQ Map with definitions of Sandhills prior to TransCanada’s definition of the Sandhills:

Nebraska DEQ Map with definitions of Sandhills after TransCanada’s definition of the Sandhills:

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Appendix B: Bold Nebraska and Citizen-developed map showing current proposed route crossing Sandhills, sandy soils, and a significant portion of the Ogallala Aquifer

The proposed Nebraska Reroute crosses many areas of fragile soils in Northern Nebraska: o The reroute crosses 94 miles of the NDEQ/TransCanada-defined Sandhills, without including Keya Paha County and the Nebraska Entry Point, which many landowners in Keya Paha county have demonstrated through soil mapping and research is in the Sandhills. ! The previous (denied) route crossed 92 miles of the NDEQ/TransCanada Sandhills without Keya Paha county and the Nebraska Entry Point. o The reroute crosses 109 miles of the NDEQ/TransCanada-defined Sandhills when including Keya Paha County and the Nebraska Entry Point. ! The previous (denied) route crossed 110 miles of the NDEQ/TransCanada-defined Sandhills when including Keya Paha County and the Nebraska Entry Point.

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Appendix C: TransCanada’s map submitted to the DOS for the previous Keystone XL route

Source: http://keystonepipeline-xl.state.gov/documents/organization/181804.pdf Page 3-83, Figure 3.4-5 “Generalized Geology and Geologic Cross-section A-A in the High Plains Aquifer and Underlying Bedrock.”

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Appendix D: Map showing TransCanada’s previously-defined Sandhills region overlaid with the current proposed route

Source: http://keystonepipeline-xl.state.gov/documents/organization/205636.pdf, page 3.3-17

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Appendix E: Generalized Depth to Water Map

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Appendix F: NRCS Custom Soil Resource Report – Niobrara River

Source: NRCS Custom Soil Report – Boyd, Holt, and Keya Paha County

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Appendix G: NRCS Custom Soil Resource Report – Antelope County

Source: NRCS Custom Soil Report – Antelope County

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Appendix H: FEIS Highly Erodible Soils

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Appendix I: TransCanada Side Letter Agreement

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Song, Lisa. “New Keystone XL Route Could Still Threaten Ogallala Aquifer.” Inside Climate News. 14 March Song, 2012. Lisa. Available: “New Keystone http://insideclimatenews.org/news/20120314/nebraska-sandhillsXL Route Could Still Threaten Ogallala Aquifer.” Inside Climate News. 14 March 2012. Available: http://insideclimatenews.org/news/20120314/nebraska-sandhillskeystone-xl-pipeline-reroute-ogallala-aquifer-water-transcanada?page=show Exxon, TransCanada. The Alaska Pipeline Project. Available: http://thealaskapipelineproject.com/ Heineman, Dave. “Governor Calls on President to Deny Pipeline Permit.” Available: http://www.governor.nebraska.gov/news/2011/08/31_pipeline.html

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