Energy Security: Tar Sand will not Reduce Dependence on Foreign Oil

Keystone XL will not lessen U.S. dependence on foreign oil, but transport Canadian oil to American refineries for export to overseas markets.

Keystone XL is an export pipeline. According to presentations to investors, Gulf Coast refiners plan to refine the cheap Canadian crude supplied by the pipeline into diesel and other products for export to Europe and Latin America. Proceeds from these exports are earned tax-free. Much of the fuel refined from the pipeline’s heavy crude oil will never reach U.S. drivers’ tanks.

Reducing demand for oil is the best way to improve our energy security. U.S. demand for oil has been declining since 2007. New fuel-efficiency standards mean that this trend will continue once the economy gets back on track. In fact, the Energy Deptartment report on KeystoneXL found that decreasing demand through fuel efficiency is the only way to reduce mid-east oil imports with or without the pipeline.

More info:

“Exporting Energy Security: Keystone XL Exposed”, Oil Change International

Gas prices: Keystone XL will increase gas prices for Americans—Especially Farmers

By draining Midwestern refineries of cheap Canadian crude into export-oriented refineries in the Gulf Coast, Keystone XL will increase the cost of gas for Americans.

TransCanada’s 2008 Permit Application states “Existing markets for Canadian heavy crude, principally PADD II [U.S. Midwest], are currently oversupplied, resulting in price discounting for Canadian heavy crude oil. Access to the USGC [U.S. Gulf Coast] via the Keystone XL Pipeline is expected to strengthen Canadian crude oil pricing in [the Midwest] by removing this oversupply. This is expected to increase the price of heavy crude to the equivalent cost of imported crude. The resultant increase in the price of heavy crude is estimated to provide an increase in annual revenue to the Canadian producing industry in 2013 of US $2 billion to US $3.9 billion.”

Independent analysis of these figures found this would increase per-gallon prices by 20 cents/gallon in the Midwest.

According to an independent analysis U.S. farmers, who spent $12.4 billion on fuel in 2009 could see expenses rise to $15 billion or higher in 2012 or 2013 if the pipeline goes through. At least $500 million of the added expense would come from the Canadian market manipulation.

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Jobs: TransCanada’s jobs projections are vastly inflated.

In 2008, TransCanada’s Presidential Permit application for Keystone XL to the State Department indicated “a peak workforce of approximately 3,500 to 4,200 construction personnel” to build the pipeline.

Jobs estimates above those listed in its application draw from a 2011 report commissioned by TransCanada that estimates 20,000 “person-years” of employment based on a non-public forecast model using undisclosed inputs provided by TransCanada.

According to TransCanada’s own data, just 11% of the construction jobs on the Keystone I pipeline in South Dakota were filled by South Dakotans–most of them for temporary, low-paying manual labor.

Amalgamated Transit Union (ATU) and the Transport Workers Union (TWU) both oppose the pipeline. Their August 2011 statement: “We need jobs, but not ones based on increasing our reliance on Tar Sands oil. There is no shortage of water and sewage pipelines that need to be fixed or replaced, bridges and tunnels that are in need of emergency repair, transportation infrastructure that needs to be renewed and developed. Many jobs could also be created in energy conservation, upgrading the grid, maintaining and expanding public transportation—jobs that can help us reduce air pollution, greenhouse gas emissions, and improve energy efficiency.”

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Safety: A rupture in the Keystone XL pipeline could cause a BP style oil spill in America’s heartland, over the source of fresh drinking water for 2 million people. NASA’s top climate scientist says that fully developing the tar sands in Canada would mean “essentially game over” for the climate.

The U.S. Pipeline Safety Administration has not yet conducted an in depth analysis of the safety of diluted bitumen (raw tar sands) pipeline, despite unique safety concerns posed by its more corrosive properties.

TransCanada predicted that the Keystone I pipeline would see one spill in 7 years. In fact, there have been 12 spills in 1 year. The company was ordered to dig up 10 sections of pipe after government-ordered tests indicated that defective steel may have been used. KeystoneXL will use steel from the same Indian manufacturer.

Keystone XL will cross through America’s agricultural heartland, the Missouri and Niobrara Rivers, the Ogallala aquifer, sage grouse habitat, walleye fisheries and more.

The agency was not adequately accounting for threats to wildlife, increased pollution in distressed communities where the crude may be refined, or increases in carbon emissions that would exacerbate climate change, and a variety of other issues.

More Information

Climate Change: Keystone XL is the fuse to North America’s biggest carbon bomb.