No Brainer: Senate Should Approve Keystone XL

On Friday, the House passed H.R. 5682, Louisiana Republican Rep. Bill Cassidy’s bill to approve the Keystone XL Pipeline, by 252-161. On Tuesday, the Senate takes up North Dakota Republican Sen. John Hoeven’s identical legislation, S. 2280. As of Friday, 59 senators had publicly committed to support the bill — one vote shy of the 60 required to send the measure to the President’s desk.

The President should have approved the KXL long ago. The Keystone controversy is completely artificial — a fabrication of green politics

The State Department is the lead agency in determining whether to grant the TransCanada Corporation permission to construct the pipeline for one reason only — the project crosses the U.S.-Canada boundary line, making it technically an issue of international relations. State’s job is to determine, on behalf of the President, whether the project would serve the U.S. national interest.

TransCanada filed its first application for a cross-border permit in September 2008. It has taken State more than six years not to render a decision. Yet the issue is a no-brainer.

• Do modern commerce and transport chiefly run on petroleum-based products? Yes.
• Are pipelines the most economical and safe way to transport large volumes of petroleum? Yes.
• Is Canada our staunch ally and biggest trading partner? Yes.
• Is Canada already the largest single source of U.S. petroleum imports? Yes.
• Would the KXL enhance the efficiency of oil transport from Canada to U.S. markets? Yes.
• Would the KXL support tens of thousands of American jobs and add billions to the GDP during the construction period? Yes.
• Would all the financing be private and not cost taxpayers a dime? Yes.

So how could building the KXL not be in the national interest?

According to anti-Keystone protest leader Bill McKibben, “If this thing gets built, it’s game over for the planet.” In reality, the KXL is climatologically irrelevant. As Cato Institute scientist Chip Knappenberger shows, using EPA climate sensitivity estimates, even under the unrealistic assumption that all 830,000 bpd of Canadian crude coming through the pipeline is additional oil in the global supply that would otherwise remain in the ground, the warming contribution works out to about 1/100th of a degree Celsius by century’s end. “So after nearly 100 years of full operation, the Keystone XL’s impact on the climate would be inconsequential and unmeasurable.”

Like any large infrastructure project, the KXL will have environmental impacts and pose environmental risks. However, roughly half the originally-proposed pipeline — the segment from Steele City, Nebraska to Cushing, Oklahoma (orange line in the map below), and the Gulf Coast Project from Cushing to Houston and Port Arthur, Texas (blue line) — has already been built.

 

 

 

 

 

 

 

 

Here’s what we know:

1. The Earth did not shake, the sky did not fall, and nobody felt a “great disturbance in the Force . . . as if millions of voices suddenly cried out in terror and were suddenly silenced.”
2. The Gulf Coast Project brought $2.1 billion to the Oklahoma economy, $3.6 billion to the Texas economy, and tens of millions of dollars to local tax coffers, according to a July 2014 study by the Institute for Energy Research.

The whole notion that the KXL is some kind of unique or major threat to the national interest is laughable. About 2.5 million miles of oil and gas pipelines already criss-cross the lower 48. How could laying another 875 miles of pipe push the network over some kind of national interest ‘tipping point’?

During its six-plus years of indecision, the State Department has conducted four major reviews — a Draft Environmental Impact State or EIS (April 2010), a Final EIS (August 2011), a Draft Supplemental EIS (March 2013), and a Final Supplemental EIS (Jan. 2014). The big-picture conclusion is always the same. Under the “No Action Alternative” (i.e. the project is not built and operated), Canadian crude still reaches Gulf Coast refineries, except it does so by other routes — rail, barge, smaller pipelines — that are less efficient, have greater oil spill risk, and emit more carbon dioxide (CO2) per unit of oil delivered.

The relevant charts are in my previously-posted Power Point presentation. To recap, compared to the KXL, alternative modes for delivering Canadian crude to Gulf Coast refineries are estimated, annually, to emit 28% to 42% more CO2 and spill 136% to 794% more barrels of oil.

A few years ago it was at least plausible to deny that Canadian crude would find its way to market by rail if the pipeline were blocked. Yet Keystone foes, such as former President Jimmy Carter and nine other Nobel Peace Prize winners, continue to make that claim even though events have thoroughly refuted it.

Rail deliveries of Canadian crude increased from practically zero barrels per day in January 2011 to 180,000 bpd in November 2013:

 

 

 

 

 

 

Source: FSEIS, ES-10

According to the Final Supplemental EIS, rail-loading facilities in the Western Canadian Sedimentary Basin (WCSB) are already “estimated to have a capacity of approximately 700,000 bpd of crude oil, and by the end of 2014, this will likely increase to more than 1.1 million bpd.”

The market has improvised around the Obama administration’s deny-by-delay tactics. This map shows crude-by-rail infrastructure as of 2010.

 

 

 

 

 

This map shows estimated crude-by-rail infrastructure in 2013 and estimated planned or potential infrastructure during 2014-2016.

 

 

 

 

 

Source: FSEIS, ES-11

But wait, there’s more!

On June 6, 2014, the State Department issued an Errata Sheet for the Final Supplemental EIS (FSEIS). The document reports that the rail accident estimates in the FSEIS were based on only 40.6% of the 2002 to 2012 “incident data” in the Federal Railroad Administration online database. Consequently, the FSEIS projections of injuries and fatalities associated with the “No Action Alternative” are “underestimated.”

Using these updated statistics, the estimated numbers of incidents correlated to the increased rail traffic that was assumed in the rail scenario would increase from 49 to 189 injuries, and from 6 fatalities to 28.

The chart below compares projected injuries per million ton-miles for rail and pipeline. The Keystone XL Pipeline is vastly safer.