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UPDATE 1-Court affirms alternative Keystone XL oil pipeline route through Nebraska

Nia Williams and Valerie Volcovici

Nebraska@ (Adds reaction from TC Energy, Sierra Club, background)

CALGARY, Alberta/WASHINGTON, Aug 23 (Reuters) - A court in Nebraska on Friday affirmed an alternative route in the Midwest state for TC Energy Corp's Keystone XL oil pipeline in the latest chapter in the nearly 10-year legal fight over the Canada to Texas pipeline.

Keystone XL would ship 830,000 barrels per day (bpd) of crude from the oil marketing hub of Hardisty, Alberta, to Steele City, Nebraska, but has been subject to years of delay because of fierce environmental and landowner opposition.

The Nebraska Supreme Court affirmed the alternative route that was approved by the state's Public Service Commission, TC Energy said in a statement. This was not the preferred route of the company.

The Nebraska Public Service Commission (PSC) in November 2017 did not approve TC Energy's preferred route, and instead granted an alternative route that shifted it closer to an existing pipeline right-of-way down the eastern side of the state.

That had prompted landowners and indigenous groups to sue on the grounds the PSC could only greenlight an application that was made to it.

Nebraska's Supreme Court ruled against that argument, finding the PSC did have the power to approve a route that TC Energy, formerly known as TransCanada, had not applied for.

"The Supreme Court decision is another important step as we advance towards building this vital energy infrastructure project," said Russ Girling, TC Energy's chief executive said in a statement.

Opponents of the pipeline vowed to continue fighting to stop it going ahead.

"Today's ruling does nothing to change the fact that Keystone XL faces overwhelming public opposition and ongoing legal challenges and simply never will be built," said Ken Winston, attorney for the Nebraska Sierra Club. (Reporting by Nia Williams and Valerie Volcovici Editing by Marguerita Choy)