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What do you know about the Keystone Pipeline?

Posted By Editor On January 7, 2012 @ 7:44 pm In Guest column | Comments Disabled

keystoneXL map 670x452 What do you know about the Keystone Pipeline? [1]

There is a great deal of controversy over the Keystone XL pipeline, the latest addition to the existing Keystone network.

The pipeline moves diluted bitumen from the Athabasca Oil Sands in Alberta, Canada, to multiple destinations in the United States.

The current network extends to refineries in Illinois and a distribution hub in Oklahoma. Claims that the importing of the tar sands oil will ease the energy “crisis” in the United States are questionable because the oil in the XL pipeline to the Gulf Coast is intended for export, not for domestic use. The United States is the third largest oil producing country, but export of crude oil is not permitted. No such limitation exists for refined products.

The tar sand oil will benefit the owners of the refineries on the Gulf Cost. Those companies are multinational companies, not U.S. companies. Very little economic benefit will accrue to the United States from the tar sand oil production, not even tax revenue, as these exports are tax-free.

The other major claim for the pipeline is that it will create jobs. Most of the estimates are based on projections by TransCanada, the company petitioning to build the pipeline. When the numbers are used by politicians, they leave out a lot of the underlying data and assumptions. For example, TransCanada estimates 20,000 construction jobs plus several thousand indirect jobs. What the politicians don’t say is that those are person/year jobs. Given the period of construction, that would be 10,000 jobs for two years, then just a few hundred. Additionally, a high percentage of the jobs will be Canadian jobs. The State Department puts the estimate at 5,000 jobs. Either way, it is very small number in relation to unemployment in the U.S. and it may very well destroy permanent jobs in the ranches that it crosses. Other alternatives might create more jobs.

The environmental impact is important to a big sector of our society. The first complaint has been that mining the oil sands is the dirtiest of energy operations. There has also been a big protest over the pipeline crossing the Nebraska Sand Hill ecosystem and the Ogallala Aquifer as well as pristine streams including the Yellowstone River. History has shown that it is a when, not an if, the pipeline springs a leak, and when it does, the consequences are huge and could dwarf any of the short-term economic benefit of the pipeline.

Below are several articles on the pipeline. The first is from Wikipedia and gives a non-judgmental approach to its history and purpose. The remaining articles represent a mixture of news and opinion.

I have tried to find articles representing a balanced view, both pro and con. That proved difficult, as most of the “pro” articles were more of a political diatribe than a “fact” based article. Therefore, you will find the preponderance of the articles to be arguments against the pipeline. It may be that when the exaggerations are removed, there are no good arguments for the pipeline.

 

Keystone Pipeline [2]
Wikipedia

The Keystone Pipeline System is a pipeline system to transport synthetic crude oil and diluted bitumen (“dilbit”) from the Athabasca Oil Sands in northeastern Alberta, Canada to multiple destinations in the United States, which include refineries in Illinois, Cushing oil distribution hub in Oklahoma, and proposed connections to refineries along the Gulf Coast of Texas. It consists of the operational “Keystone Pipeline” (Phase 1) and “Keystone-Cushing Extension” (Phase 2), and two proposed Keystone XL pipeline expansion segments. After the Keystone XL pipeline segments are completed, American crude oil will enter the XL pipelines at Baker, Montana and Cushing, Oklahoma.[1]

Key Facts on Keystone XL [3]
In Tar Sands Action

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.

Fact Check: Keystone XL Would Ship Foreign Oil To Foreign Lands
By Anthony Swift in Think Progress Green

One of the most important facts that is missing in the national debate surrounding the proposed Keystone XL tar sands pipeline is this — Keystone XL will not bring any more oil into the United State for decades to come. Canada doesn’t have nearly enough oil to fill existing pipelines going to the United States. However, existing Canadian oil pipelines all go to the Midwest, where the only buyer for their crude is the United States. Keystone XL would divert Canadian oil from refineries in the Midwest to the Gulf Coast where it can be refined and exported. Many of these refineries are in free trade zones where oil may be exported to international buyers without paying U.S. taxes. And that is exactly what Valero, one of the largest potential buyers of Keystone XL’s oil, has told its investors it will do. The idea that Keystone XL will improve U.S. oil supply is a documented scam being played on the American people by Big Oil and its friends in Washington DC.

Misleading Claims on the Keystone Pipeline: Brought to You By Our Friends at Washington Post  [4]
In Center for Economic and Policy Research 

News outlets reserve the option to factcheck ads and will generally refuse to run an ad that is clearly false. This is apparently not the practice at the Washington Post (a.k.a “Fox on 15th Street).

The paper had a full page ad in the Sunday edition pushing the Keystone Pipeline. One of the claims in the add is that the unemployment rate among construction workers is 20 percent. If the Post had made the long trip over to the Bureau of Labor Statistics (BLS) website [5] it would have discovered that the November employment report showed the unemployment rate among construction workers to be 13.1 percent. That is considerably higher than the national average of 8.6 percent, but still quite a bit short of 20 percent.

Keystone Jobs Versus Competitive Dollar Jobs [6]
By Dean Baker in  Truthout

The new great hope for job creation in Washington is the Keystone pipeline, a plan to create a pipeline that would transport oil from Alberta, Canada, as far as New Orleans. According to the Republican leadership and other proponents of the pipeline, it is expected to create 20,000 jobs in the construction and supplier industries.

There have questions raised about this number by analysts and by the State Department, which must approve the pipeline. It seems that this 20,000 number refers to “job years,” not jobs. This means that if a construction worker is employed for two years working on the pipeline, she would count as holding two jobs in the 20,000 jobs number. The number of jobs created at a point in time would likely be closer to half of this figure, perhaps less than 10,000.

Keystone pipeline: How many jobs it would unequivocally create  [7]
In Fight For Better US

The Keystone pipeline project is back in play as part of the payroll-tax cut debate, and Congressional Republicans say it would create jobs.

But there’s a wide range of estimates, with one forecast that Keystone could actually cost jobs.

The 1,700-mile long pipeline would transport crude oil from Canada’s oil sands region in Alberta to refineries along the U.S. Gulf Coast.

The Obama administration pushed back the project last month pending a review from the State Department, but Republicans want to bring it back as a sweetener to approve an extension of the payroll-tax break and federal unemployment insurance. A vote in the House was expected Tuesday.

Just How Many Jobs Would The Keystone Pipeline Create?   [8]
In The Texas Report   

“It’s unsubstantiated,” says Sean Sweeney, who directs Cornell University’s Global Labor Institute. He co-wrote a paper that found the numbers to be exaggerated.

“I’m not sure where 20,000 comes from,” adds Sweeney. “We know the direct construction jobs are nowhere near 20,000. We know the steel, or a portion of it, is not produced in the United States; so where are the jobs?”

Perryman describes the Cornell paper as “advocacy.”

A recent State Department study said the construction workforce would be 5,000 to 6,000 workers. And once the construction phase ends, almost all of these jobs, however many are created, would go away.

Six reasons to oppose Keystone pipeline [9]
By Sam Webb in People’s World

There are many reasons to oppose the building of an oil pipeline from the tar sands of Alberta, Canada, to the refineries off the shores of Texas in the Gulf of Mexico.

One: The employment impact of this Keystone XL pipeline will be far less than advertised. The GOP leadership says the pipeline “would create over 100,000 jobs,” but this is a gross inflation. According to the State Department, it will provide about 6,000 temporary jobs for construction workers. But even this number may be a significant overestimation. As for permanent jobs, the number will be far fewer, somewhere in the hundreds, according to TransCanada Corp., the company that will build the pipeline if it is approved.

Two: Meanwhile the project will put at risk a quarter million ranches and farms that provide real jobs in the Great Plains states.

The Keystone XL Pipeline: A Tar Sands Folly? [10]

By Bill Chameides In Duke Univeristy Nicholas School of the Environment and National Geographic 

 

Hillary Clinton is in the tar sands hot seat. Is she asking the right questions?

The U.S. State Department is in the rare position of having to decide on an environmental issue. TransCanada wants to expand an existing pipeline to bring tar sand oil from Alberta, Canada, to Texas. Because it’s an international project, the State Department must review and approve it, a process expected to be completed by year’s end but that could be extended to complete a “thorough review process.”

The review process requires, among other things, “disclosure of potential environmental impacts (beneficial and adverse) and the consideration of possible alternatives.” So far, two environmental impact drafts have been prepared — the latest released on April 15. Both have been roundly criticized [pdf] by the Environmental Protection Agency for not adequately assessing oil spill risks and potential alternate pipeline routes. Until this is done, the agency warns that it will characterize the project with “environmental objections — insufficient information.”

Meanwhile, some in the House, in hopes of increasing the likelihood of a green light from the State Department, are throwing their weight behind a measure, to be voted on Tuesday, to cut off the pipeline’s environmental review by November 1 ($ub req’ed).

The Keystone Scoop

The story starts with western Canada’s tar sands — also known colloquially as oil sands. The stuff is a far cry from what we normally think of as oil. First, the bitumen — a heavy viscous, tar

U.S. should build Keystone oil pipeline [11]

Editorial in The Tuscaloosa News

Gas prices have risen over the past several days as Iran blusters about blocking a key transportation route in the Mideast, showing how vulnerable U.S. policy and our economy is to imported petroleum.

We need to find alternatives. The United States should encourage companies to develop alternative fuels and more fuel-efficient vehicles. We are losing out on those technology jobs to other countries. It is where the future lies.

But, despite the need to move away from dirtier energy sources, demand for oil will remain high for decades, even in the most optimistic projections. In the meantime, we need to do all that we can to lessen our dependence on oil from unfriendly nations.

The Keystone XL oil pipeline could help. While we share many of the environmental concerns about the pipeline that would run from Canada to Texas, the reality is that it would not change demand for oil or alter the reality that Canada will open its vast oil fields one way or another.

Canada’s government has made it clear the oil is going to come out of the ground and be sent somewhere, one way or another. We need those jobs and that access to the oil.


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URLs in this post:

[1] Image: http://www.berthoudrecorder.com/wp-content/uploads/2012/01/keystoneXL-map.png

[2] Keystone Pipeline: http://en.wikipedia.org/wiki/Keystone_Pipeline

[3] Key Facts on Keystone XL: http://www.tarsandsaction.org/spread-the-word/key-facts-keystone-xl/

[4] Misleading Claims on the Keystone Pipeline: Brought to You By Our Friends at Washington Post : http://www.cepr.net/index.php/blogs/beat-the-press/misleading-claims-on-the-keystone-pipeline-brought-to-by-our-friends-at-washington-post

[5] website: http://bls.gov/news.release/empsit.t14.htm

[6] Keystone Jobs Versus Competitive Dollar Jobs: http://www.cepr.net/index.php/op-eds-&-columns/op-eds-&-columns/keystone-jobs-versus-competitive-dollar-jobs

[7] Keystone pipeline: How many jobs it would unequivocally create : http://fightforbetterus.blogspot.com/2011/12/keystone-pipeline-how-many-jobs-it.html

[8] Just How Many Jobs Would The Keystone Pipeline Create?  : http://texasreport.net/2011/12/just-how-many-jobs-would-the-keystone-pipeline-create/

[9] Six reasons to oppose Keystone pipeline: http://peoplesworld.org/six-reasons-to-oppose-keystone-pipeline/

[10] The Keystone XL Pipeline: A Tar Sands Folly?: http://www.nicholas.duke.edu/thegreengrok/keystoneXL

[11] U.S. should build Keystone oil pipeline: http://www.tuscaloosanews.com/article/20120106/NEWS/120109898?tc=ar

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