Obama Administration Continues to Stall on Keystone XL Pipeline

Rebuking delays by the EPA, a subcommittee of the House Energy & Commerce Committee, passed legislation today that would require a decision to be made on the Keystone XL Pipeline by November 1, 2011.  The project was first proposed over 5 years ago by Transcanada. Pending approval by the State Department (the State Department is in charge here as the pipeline crosses into Canada), the ambitious 2000 mile pipeline would link oil sand production in Canada to refineries in Texas, with a capacity that could potentially exceed 1 million barrels per day.

Unsurprisingly, the environmentalists have thrown the book at EPA, with all sorts of misleading concerns:

Such considerations are irrelevant to ENGOs, which have become a fount of misinformation on Keystone. In February a coalition consisting of the Natural Resources Defense Council, the Sierra Club, the National Wildlife Federation and Pipeline Safety Trust produced a report titled Tar Sands Pipeline Safety Risks. The report claimed that diluted bitumen was “a highly corrosive, acidic, and potentially unstable blend of thick raw bitumen and volatile natural gas liquid condensate.” Thus its transportation represented an unacknowledged hazard, while the line’s “higher operating temperatures and pressures” presented new and significant risks. The report claimed, alarmingly, that the Alberta pipeline system had “16 times as many spills due to internal corrosion as the U.S. system” and implied that this was due to the transportation of diluted bitumen.

Alberta’s Energy Resources Conservation Board (ERCB) responded immediately that the ENGO’s report was riddled with errors. When it came to transporting bitumen and bitumen blends, there had been only eight spills attributed to internal corrosion in the previous 35 years. Canadian pipeline spill rates were in fact lower than those in the U.S. Moreover, when it came to claims of extra corrosivity, there was no evidence of any difference in failure rates for pipelines carrying bitumen or blends. TransCanada meanwhile pointed out that the heat of any crude or synthetic product in pipelines was a function of friction and common to all lines. The pressures in the Keystone XL line would not be outside industry norms.

The environmentalists also warned of future events similar in scope to the Deepwater Horizon oil spill, which is of course absurd.

A larger point to be made here is that despite the futile wishes of the environmental movement, the oil will be extracted from the ground in Canada. Banning the KeystoneXL pipeline won’t change this, the oil will still be sold either to the U.S. or possibly overseas. Not allowing construction of the Keystone XL pipeline might have the unintended consequence of actually increasing total emissions, as Michael Giberson explains:

Since a pipeline would be the cheapest and best way to deliver Alberta’s oil to market, if the National Wildlife Federation and other groups succeed in imposing some more complicated and costly delivery method then at the margin some production in Alberta will be deterred. The result: U.S. will instead buy the oil that would have come from Alberta from elsewhere, and have it delivered by ocean-crossing tankers. Last I looked oil tankers were not propelled by rainbow juice and unicorn kisses, so those likely alternatives will come with their own set of greenhouse gasses and other emissions.

Assuming the tar sands are developed – and as Hahn and Passell say, “last time we looked, Canada was a functioning democracy capable of making its own decisions” – the pipeline is likely the most environmentally friendly way of delivering the oil to consumers.

Indeed. This also serves of another example of the ongoing battle between economic prosperity and strict environmentalism. Blocking the hundred’s of different projects similar to this does have a real, negative effect on employment in the United States.



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