This paper presents a new approach for the determination of underground cable ampacity that considers surrounding medium of the cable, and compares the results from the FEM model with standard approach. It shows how ampacity of a buried cable is affected by the extent of heat transfer from the cable to the surrounding soil and also by the heterogeneity of the soil and its thermal characteristics. Numerical and finite element model of steady-state thermal analysis and ampacity evaluation are presented in this paper. COMSOL software is used for the three dimensional simulation of a 44kV armored HVAC XLPE cable buried directly in native soil. The methodology includes mathematical solutions for heat transfer equations to calculate and obtain the temperature at the cable surface and results show the optimal acceptable ampacity. The results from the proposed method provide solutions for ampacity problems that require flexibility and dynamic approach for real life scenarios that are not present in the literature and previous works.