The White House today threatened to veto the latest House Republican transportation bill over its inclusion of a provision fast-tracking the Canada-to-U.S. Keystone XL oil pipeline.

The veto recommendation from the Office of Management and Budget effectively recommits President Obama to opposing the $7 billion project -- despite his support for its southern leg connecting Oklahoma oil terminals with the Gulf Coast -- on the same day that Nebraska's governor signed a state law intended to speed up the controversial selection of a new Cornhusker route for the pipeline.

Rep. Lee Terry (R-Neb.), sponsor of House legislation overriding Obama's January rejection of the XL line, vowed that the inclusion of his proposal in the new transportation bill amounted to more than "messaging" against a president whom his party views as uniquely vulnerable on energy during a season of record-high gasoline prices.

"The reality is that Nebraska will no longer be an issue the president can use to block the pipeline" following Gov. Dave Heineman's (R) approval of the new state pipeline review law this afternoon, Terry said in an interview.

Obama and his advisers have repeatedly pointed to Heineman and other Republicans who opposed the original Keystone XL route out of concern that it would take the project's 700,000-plus daily barrels of emissions-heavy Canadian oil-sands crude across the ecologically vulnerable soil of the Nebraska Sandhills. But since pipeline sponsor TransCanada Corp. agreed to move the XL line around the Sandhills, Heineman has lent his support to the project and helped its backers expedite the approval of a new Nebraska route over lingering opposition from green advocates and the state farmers union.

TransCanada said in a statement today that it would release a new route through Nebraska "very shortly," and Terry told E&ENews PM that he believed state officials already had reached "agreement" with the company on a new path that would soon head for an environmental review.

But in its veto message today, the White House continued to cite "the fact that the pipeline route has yet to be identified" in explaining why Obama's aides would recommend a veto of the House GOP transportation bill. Also, the budget office wrote, "there is no complete assessment of [the pipeline's] potential impacts, including impacts on health and safety, the economy, foreign policy, energy security, and the environment."

As of press time, the House Rules Committee was meeting to determine what the final transportation measure would include when it comes to the floor, with a final vote scheduled for tomorrow. An initial plan to extend current transportation law for 90 days, representing a shell position intended to bring the House into conference talks with the Senate over its bipartisan new bill, could yet be scrapped by Republicans hoping to resuscitate the infrastructure proposal that ran aground last month after becoming a political headache for Speaker John Boehner (R-Ohio) (E&E Daily, March 27).

Terry said his understanding as of this afternoon is that his Keystone XL language would be the only energy-related element of the bill to be voted on tomorrow, though that limitation would not preclude the chamber from taking up more of the policy reforms sought by House Transportation and Infrastructure Chairman John Mica (R-Fla.).

One of the amendments submitted today to the rules panel, for example, would restore language from Mica's proposal that lowered the barrier of environmental review to new transportation projects.

With the content of the House bill still unclear, the White House's veto message treated the legislation as a 90-day extension of current law. "[T]his legislation would miss a critical opportunity to provide more certainty to states and localities as they undertake the long-term planning and execution of projects and programs that are essential to creating and keeping American workers in good paying jobs, improving the nation's surface transportation infrastructure, and ensuring roadway safety," the president's budget office wrote.