The Keystone XL and the US Oil Export Ban

UPDATE: The 40-year-old US oil export ban was lifted on December 16, 2015. More..

Keystone XL Contruction.  Texas.

For the Canadians, the Keystone XL has been an interesting regulatory waltz.

Those old enough to remember the gas station lines of the 1970’s may recall the economic disruption caused by OPEC’s oil embargo over 40 years ago. In response, Congress passed the Oil Export Ban which brought energy security to America by insuring that oil produced in America stayed in America – with the exception of that oil exported to Canada.

Currently, with Mexican heavy crude production dropping, Mexican exports to Gulf Coast refineries has fallen. The Keystone XL pipeline compensates for the diminished Mexican supply by delivering Canadian diluted bitumen from the Alberta Tar Sands. Since the Jones Act requires that goods transported between US ports be carried on US-flagged ships staffed and owned by US citizen, it is cheaper for the Canadians to ship the refined oil back to Canada on non-US carriers. From there, the refined petroleum is available to world markets where it will fetch the highest price. The round trip makes the costly-to-extract tar sands oil competitive in a tight global market.

So while the Keystone XL has been billed as a jobs program and a safe oil supply for energy thirsty America, the pipeline allows foreign (Canadian) oil to be refined in the US where it can then be shipped to foreign markets (via Canada using non-US labor).

Things got dicey for the costly Canadian oil in December when OPEC refused to limit their oil production, crashing the world price of oil in an effort to drive the heavy grades of oil from Mexico, Venezuela, and Canada out of the market.

Meanwhile, on American soil (where the Keystone XL is projected to increase oil prices in the Midwest by relieving delivery bottlenecks and, thus, open the area to market-priced oil) the OPEC play has resulted in cheap gas and tighter production margins nationwide. In the end, it may be the market, and not climate concerns, that kills the Keystone.

Oddly, though, it was Citicorp who lifted North Dakota and Gulf Coast shale oil producers (aka frackers) from this Christmas season OPEC-induced funk when they made a little-noticed New Year’s Eve announcement stating that the Obama Administration’s Commerce Department would allow ultralight crude exporters to sidestep the export ban. Why the White House didn’t make the announcement themselves is unknown but, evidently, with a shale oil glut on the horizon, the drilling boom may be coming to an end unless other markets can be found.

Masked by the OPEC’s low prices is that the costly extraction of tar sands and shale oil is a clear indication that we’ve reached the end of cheap, easy oil. If energy security is truly an American priority, the export ban is more pertinent today than 40 years ago.

Map: Gulf Coast Waterbody Crossings – Completed

The Keystone Mapping Project’s Google Earth View has been updated with the waterbody crossing data (for both the pipeline and the access roads) from the Ft. Worth Office of the United States Army Corp of Engineers. This information was obtained by Freedom of Information Act request from USACE – after they had begun approving construction.

Stream, river, and aquifer contamination is a major concern with the Keystone XL due to the toxic chemicals mixed with the tar sands oil during transportation. You can read more about it here.

The new Keystone Mapping Project Google Earth view can be downloaded here:

or viewed online here (plug-in required).

Map: KXL Oil Spill Voluntary Evacuation Zone

Updated July 10, 2012: A report by the National Transportation Safety Board has found that Enbridge Inc. did not follow its own safety procedures and was aware of flaws in the pipeline five years before the spill. The Kalamazoo spill has become the most costly onshore oil spill in US history. [more..]

In 2010 a tar sands oil spill in the Kalamazoo River in Michigan despoiled 40 miles of river and released a toxic cloud. According to an article in the Tyee, Spill from Hell: Diluted Bitumen:

The local residents and EPA responders near Kalamazoo quickly learned that bitumen and diluent do not stay together once released into the environment.

Volatile portions of the diluent containing toxic fumes of benzene and toluene began off-gassing in the area, impacting the health of almost 60 per cent of the local population with symptoms such as nausea, dizziness, headaches, coughing and fatigue. Clean-up crews were issued respirators to protect them from toxic fumes.

Local residents interviewed by the Tyee reported that even weeks after the Kalamazoo spill, they could still smell the fumes up to 50 kilometres away. The local health department went to door-to-door in the days after the spill to assess acute symptoms. They also instituted a voluntary evacuation within about one mile of the river to limit people’s exposure to benzene fumes — a known carcinogen.

As reported in the Michigan Messenger, a toxicologist found the Kalamazoo spill much more toxic than previously acknowledged. Thus far, the EPA has recovered 35% more oil than the pipeline’s owner, Calgary-based Enbridge Energy, reported as spilled.
The clean up, originally estimated to take one year, is far from completed. Switchboard has reported that the Kalamazoo tar sands spill has become the most costly pipeline spill in history with no end in sight to the clean up.

The Google Earth add-on view below applies this reality to the Keystone XL and expands the pipeline corridor to encompass a possible voluntary evacuation zone should a spill occur:

This file is for personal use only. Distribution and posting to the Internet is not permitted without written permission. All site contents ©Thomas Bachand 2012.

Keystone Mapping – Site Launch

A couple of months ago I decided to take a look at the Final Environmental Impact Statement (FEIS) for the proposed Keystone XL pipeline that is planned to run from Alberta, Canada to Houston, Texas. TransCanada Corporation aims to deliver Canadian tar sands oil to southern US refineries and ports. The environmental implications of this project are tremendous.

Conspicuously missing from the FEIS are the pipeline’s GIS route and milepost marker (MP) location data. The MP data are referenced throughout both the project and Department of State documents and are a key reference for all discussions of the pipeline route, potential environmental impacts, and surrounding points of interest. After my routine request for public pipeline milepost data turned into a bureaucratic run-around, I sought out alternative sources for this information by which to create the partial route and MP maps found on this site. Stay tuned as additional requests are pending.

If the American public is going to make an informed and prudent decision on the proposed Keystone XL pipeline, they will require accurate and comprehensive information presented in a cogent and easily accessible manner. I hope that this site is a step in that direction.