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“A Loophole To Avoid Official Scrutiny”: No Keystone, No Problem; The Oil Industry Is Making Other Pipeline Plans

Environmentalists have been waiting since 2008 for President Barack Obama’s decision on whether to approve the Keystone XL pipeline. That decision may come any day now. But Canada’s tar sands industry hasn’t been waiting around.

Publicly, TransCanada, the company behind the embattled pipeline, insists it is still optimistic it will win the long-running standoff—not just over Keystone, but another pipeline project that has faced environmental opposition as well, Energy East. “We’re optimistic for both of our projects,” TransCanada spokesman Mark Cooper told the New Republic.

The speculation in private, however, is that the writing may be on the wall for Keystone at least. “The rumor is that the decision to deny has been made, and they’re just waiting for the right time and venue,” an unnamed source familiar with the company told The Canadian Press this month. Republican lawmakers in the U.S. have echoed the pessimism. “I don’t see a scenario where the president would sign off on Keystone,” Senate Energy and Natural Resources Chair Lisa Murkowski told Bloomberg recently. Then there are Obama’s own words over the last year, which suggest he’s leaning against the project.

This decision will be Obama’s final word on the Keystone XL pipeline. But for TransCanada, it won’t be the end of the story. Even if its permit is rejected, TransCanada has a few paths forward for keeping Keystone alive. The company may eye a NAFTA lawsuit arguing trade discrimination, or it may submit a new application under the next president—if it’s a Republican, the company would face a much easier time.

In the meantime, rail is the go-to substitute for missing infrastructure to ship oil from Canada to the U.S. Sixty percent of Alberta’s unprocessed oil already makes its way to American refineries by rail and pipelines. And in 2012, Canada exported 16,000 barrels of oil per day by rail to the U.S. In the first quarter of 2015, it exported 120,000 barrels per day, which might rise depending on whether global oil prices begin to increase again. As green organizing has focused on pipeline infrastructure, it’s done little to stop the explosion in tar sands shipments by rail and tanker.

But TransCanada’s main business is still in pipelines, not rail, giving it every incentive to plow forward with alternative options if Keystone gets axed. For a hint at how round two of this fight could play out, Energy East offers a few clues.

This project would run from Alberta eastward to the Atlantic coast, carrying even more oil (at 1.1 million barrels of crude oil per day) than Keystone. Just like Keystone, Energy East’s way forward hasn’t been easy. The project is facing its own political opposition from Canadian provinces that are concerned about the pipeline’s environmental impact.

The years of waiting for a decision on Keystone has made the company aware of what scrappy environmental organizing can do. “There’s a very loud and vocal minority that have been very effective in their messaging, and we have had over the years needed to adjust how we get out there,” Cooper said. And so, from the beginning, the Energy East project has included an aggressive public relations campaign, including paid media, monitoring of op-ed pages and letters to the editor, social media campaigns, meetings with landowners, politicians, and third parties. It officially filed its application with Canada’s Stephen Harper administration in October 2014, amid a publicity blitz.

In a further example of the company’s newfound savvy, TransCanada pulled plans in April to build a marine tanker terminal to Energy East along a river in Quebec, which had roused local and environmental concerns for the region’s beluga whales. As a result, there’s been a two-year delay to the pipeline, with an anticipated in-service date in 2020. Yet this concession was a deliberate move, one that fits in with TransCanada’s broader P.R. push. The terminal delay is inconsequential, considering the company’s long-term thinking: TransCanada builds good-will in Canadian provinces by caving on specific environmental concerns that don’t make or break the project, all in order to get the final OK from governments.

And as TransCanada faces obstacles on all fronts for its pipelines, other companies have taken measures to avoid similar struggles. One of these controversial projects is Enbridge’s Alberta Clipper or Line 67 pipeline, which crosses the U.S. border in North Dakota. The company wants to expand the pipeline’s capacity from 450,000 barrels per day to 800,000.

And in order to avoid the complications that have plagued Keystone, it found a way to ship oil across the border without needing a new permit from the State Department. Enbridge simply plans to connect two pipelines through an existing cross-border line, Line 3. By using the 1960s-era Line 3, which doesn’t require the same environmental assessment and public comment as Line 67, Enbridge can still ship 800,000 barrels of oil per day, as it originally planned.

According to environmentalists, this is a bait and switch, and 63 green groups urged Obama to reconsider in a June letter. “Rather than wait for this requisite environmental review and permitting process to run its due course, Enbridge decided it would immediately increase the flow of Alberta Clipper by diverting the oil onto an adjacent pipeline for the actual border-crossing, then diverting the oil back to Alberta Clipper just south of the U.S.-Canada border,” the letter said.

Enbridge critics insist the company needs to be held to the same environmental standards as Keystone, and that this work-around is nothing more than a loophole to avoid official scrutiny. The company did not return a request for comment.

For green activists, the most effective way to limit tar sands development has long been to block, delay, and frustrate attempts to build the infrastructure that will carry crude oil, which contributes roughly 17 percent more in greenhouse gas emissions than conventional oil. The ideal form of transport for the industry is by pipeline, for the same reasons environmentalists oppose the new infrastructure. It is cheaper and more efficient, meaning the oil and gas industry can ship more at less cost. Or more accurately, it’s cheaper by pipeline if you don’t count the cost of potential oil spills, clean-up, and the overall impact on the climate.

Still, as long as economic conditions make oil extraction profitable in the medium- to long-term, TransCanada and other companies have every incentive to try new and ever shrewder ways to make a profit.


Rebecca Leber, The New Republic, August 18, 2015

August 19, 2015 Posted by | Canadain Tar Sands, Keystone XL, Oil and Gas Industry, TransCanada | , , , , , , | Leave a comment

“Keystone Isn’t A Futile Fight”: The Owners Of The Keystone Pipeline Just Canceled A Project In Canada

TransCanada on Thursday announced a two-year delay to its plans to move the Canadian tar sands. The company is cancelling its plans to build a controversial export terminal in Quebec, citing environmental concern over the endangered beluga whale. This means a delay to plans for finishing the Energy East pipeline, now set for 2020. In the meantime, TransCanada will search for a new location for its port.

For once, then, Canadian oil news isn’t about the TransCanada-owned Keystone XL, which has faced a six-year delay as the Obama administration sits on a decision to issue a permit. At least not directly, anyway. Energy East, once completed, would be even bigger than Keystone XL, delivering 1.1 million barrels of crude oil per day, compared to Keystone’s 800,000 barrels. As its name implies, the pipeline would run from the Alberta tar sands eastward to the shipping lanes of the Atlantic coast.

Not only are Keystone and Energy East similar battles, but proponents (and opponents) often tie the two pipelines’ fates together. Keystone opponents say building that pipeline would ensure tar sands extraction continues at a rapid pace, setting the world on track for severe climate change. Proponents argue that Keystone doesn’t matter either way, because other pipelines like Energy East make tar sands development inevitable. If the United States doesn’t build its pipeline, they say, Americans will miss out on the economic benefits. “We don’t think there’s any way that the oil will stay in the ground,” Matt Letourneau, a spokesperson for the U.S. Chamber of Commerce, said last year. “Certainly the market will find a way.”

But so long as there are delays, tar sands development isn’t inevitable because Energy East’s future, like Keystone’s, is far from settled. Oil companies are still in the middle of working out how to get the landlocked tar sands to the coasts for refining and shipment, and during their delays on multiple fronts, Keystone isn’t a futile fight.

The delay could provide a boost to organizers trying to delay other tar sands projects. Each of these pipelines face a similar environmental playbook: Delay as long as possible in the hopes that it becomes unprofitable or impossible for companies to pursue their plans. Keystone has faced years of delay, and now Energy East faces its own uncertain future. Environmentalists weren’t the only reason for TransCanada’s change of plans. Because oil prices are low right now, companies have little incentive to pursue their plans to extract costly tar sands for little profit.

TransCanada still has a strong incentive to find a new port and finish construction. Oil prices surely will rebound eventually, making the tar sands profitable once again.

“I don’t think you can look at this as a major impediment to the future of oil sands development but it certainly speaks to the opposition to pipelines, the anxiety about shipments of oil and, of course, to the increasing importance of environmental protection to the public,” Andrew Leach, an economist with the University of Alberta, said. “The beluga is an iconic species, so I think the writing was on the wall for this once the risk to habitat was made clear, in particular in Quebec.”

In the short-term, however, this is a win for environmentalists. And it may even help them in their fight against Keystone.


By: Rebecca Leber, The New Republic, April 2, 2015

April 4, 2015 Posted by | Big Oil, Environment, Keystone XL | , , , , | Leave a comment

“Keystone, Patriotism, And The White Working Class”: That Moment In Which Good Policy And Good Rhetoric Meet

Some time in the next two weeks, President Barack Obama is expected to veto a bill authorizing the construction of the Keystone XL Pipeline. The U.S. House passed a measure last week. A similar bill passed the U.S. Senate the week before. Republicans, and even some Democrats, are calling it the “Keystone jobs bill.”

Activists hope Obama will veto the bill out of concern for an already overheated planet — the refining and consumption of Canadian tar-sands oil results in double the amount of carbon emitted into the atmosphere. But that rationale is unlikely. The president is probably going to argue that Congress exceeded its constitutional authority. In crossing an international boundary, the pipeline is executive-branch turf.

But I wonder if this might be an opportunity, at least a rhetorical opportunity best understood in a somewhat different context. That context is the Democratic Party’s dismal performance among white working-class voters, who generally believe the Republican Party represents their interests even though it doesn’t.

Before I continue, please allow me to disclaim that when it comes to the white working class, I have some authority. My dad long-hauled steel. My mom raised four children in a comfortable trailer home while Dad was on the road. They certainly don’t approve of everything the government does — their anti-military views are exceptional — but right or wrong, America is theirs. And thanks to their rearing, America is mine, too.

To say my parents were conflicted over the role of the federal government in their lives is an understatement, but to say they wanted it out of their lives, as Republicans repeatedly claim on their behalf, is a gross overstatement. There’s nothing wrong with government as long as it serves the people whose biggest asset is their labor, which in their world means everyone not born into so much wealth that they don’t need to work.

Why does the white working class even matter to Democrats? Doesn’t the demographic tide favor them? Yes, but as Andrew Levison has argued, the Democrats still need white working-class voters. Without them, the party will scarcely attain the majoritarian momentum it needs to advance a truly progressive agenda. To be blunt, without them, demographics for the Democratic Party isn’t destiny. It’s doom.

The question is how to reach them. Democratic strategists cyclically scratch their heads in disbelief at white working-class voters acting in contrast to their interests. But such behavior shouldn’t be all that surprising. After all, voting is the result of emotion at least as much as it is the result of tactical decision making. And this is where I think the president’s expected veto of the Keystone bill is connected to the white working class. If there’s one thing white working-class voters respond to, it is emotional appeals to their deep and abiding sense of patriotism (the Republicans long ago mastered the art of such appeals). But Obama has an opportunity to shift the rhetorical landscape in favor of the Democrats by vetoing the Keystone bill in the name of country.

I’m not just favoring good rhetoric over good policy: This is a moment in which good policy and good rhetoric meet.

First, the pipeline isn’t going to help many Americans. Indeed, the Republicans never let a moment go by without reminding us that Obama’s own Department of State estimates that thousands of jobs will emerge from the $8 billion construction of the pipeline. But a majority of those jobs are seasonal. Once the project is completed, about 35 jobs will endure, according to the very same government estimate.

Second, the pipeline is going to help many Canadians. The Keystone is one of five proposed pipelines needed to profit from billions being invested in the extraction of tar-sands crude. This handful of pipelines tops the list of Canada’s national priorities. According to Mark Dowie, in The Washington Spectator, if even one of the pipelines is stymied, Prime Minister Stephen Harper’s dream of creating a petro-state will die. So pressure is mounting. Harper, Canada’s oil companies, and their very wealthy investors around the world want to see the Keystone built. In the United States, it will create a flurry of temporary activity, but the long-term rewards will be entirely enjoyed by Canadians.

That matters to white working-class voters. That’s something that can’t be squared with Republican claims that Keystone is simply a jobs bill.

All right. Let’s accept the premise — Keystone is a jobs bill. If so, it’s bad one. As I said, lots of temporary jobs, a few permanent jobs and nothing left for the greater good. All future dividends from billions presently invested will flow north of the border. Indeed, it’s Americans who will suffer detriment in the event of a leak. (Leaks are rare, but when they happen, they are catastrophic to communities, property and natural resources.) A better jobs plan can be found in the president’s fiscal year budget. It calls for federal expenditures on the construction and upkeep of the country’s (literally) crumbling infrastructure. How does Obama hope to pay for all these roads, bridges, tunnels and waterways? By levying a tax on the offshore accounts of the very wealthy.

The president wants to tax the money of a very small minority of Americans who don’t want to pay U.S. taxes. He wants to raise revenues to fund the construction, and reconstruction, of the country’s infrastructure. If expenditures reach as high as $1 trillion, as Vermont senator Bernie Sanders has proposed, we are talking about hundreds of thousands of seasonal and permanent jobs, with something to show for all the effort—a lasting investment. (Sanders’ proposal would also probably include a hike in the federal gas tax, which hasn’t gone up since the mid-1990s.) Conversely, the Republicans blindly oppose all tax increases, even on those without enough sense of patriotism to want to pay their due in taxes while everyone else does.

If that appears to be the making of a wedge issue, that’s because it is, and the Democrats need to exploit it. The Keystone reveals a rift between rich Americans who don’t pay taxes and working-class Americans who do; between rich Americans who don’t want to rebuild America, for Americans, and working-class Americans who do.

The bottom line: Courting white working-class voters will take more than appealing to their economic interests. It isn’t enough to do the right thing, and this is where I part ways with others on this subject. I tend to believe the Democrats don’t do enough to drive a wedge between white working-class voters and the Republican Party elites who claim to represent them. The GOP’s hold on the working-class imagination is strong, thanks to years and years of race baiting and fearmongering. So when the rare opportunity arises in which Democrats can illuminate the clear contrasts between the interests of the very, very rich and everyone else, it shouldn’t be wasted.


By: John Stoehr, Managing Editor of The Washington Spectator; The National Memo, February 17, 2015

February 18, 2015 Posted by | Congress, Keystone XL, Patriotism | , , , , , , , , | Leave a comment

“A Time To Veto”: Exercising Authority Under The Constitution In Precisely The Way Our Founders Intended

President Obama is poised to reject legislation meant to force the approval of the Keystone XL tar sands pipeline, in what would be his third veto since taking office six years ago.

Pipeline proponents, naturally, are howling.

Obama, though, is exercising his veto authority under the Constitution in precisely the way our founders intended: as a check on Congressional overreach at odds with the good of the country.

The president is the only public official elected to represent all the American people. That confers upon the president, uniquely, an obligation to act on behalf of the entire country, not simply a collection of congressional districts or states, in a way that reflects the common will and advances the national interest.

The Constitution enshrines the presidential veto as a vital tool for fulfilling that role, and leaders throughout our history have found it essential. Presidents stretching back to George Washington have used the veto 2,563 times to reject legislation passed by both houses of Congress.

Ronald Reagan used his veto power 78 times — the most of any president in modern times. Obama, at the other end of the scale, has vetoed just two bills so far — fewer than any other president in 160 years.

Rarely is the veto more clearly in order as now.

Under long-established procedure, the question of whether to approve a project like a pipeline that would cross a U.S. border hangs on a single criteria: is the project in the national interest? It is the president’s job — and properly so — to make that determination.

In assessing whether the Keystone XL tar sands pipeline meets the criteria, Obama has put the U.S. State Department in the lead, with expertise added from an array of other government agencies that oversee commerce, transportation, energy, environment and other important areas central to the national interest.

The Republican-led House gave final congressional approval today to a bill meant to force approval of the tar sands pipeline in a way that would usurp presidential authority, short-circuit the deliberative process of informed evaluation already underway and supersede the president’s obligation to determine whether the project is good for the country.

Those are three good reasons to veto the bill.

There is, though, one more, and it goes to the heart of our system of checks and balances.

The tar sands pipeline is not a project designed to help this country. It is a plan to pipe some of the dirtiest oil on the planet — tar sands crude mined from Canada’s boreal forest using some of the most destructive industrial practices ever devised — through the breadbasket of America to Gulf coast refineries where most of the fuel will be shipped overseas.

It would create 35 permanent American jobs, according to the Canadian company that wants to build the pipeline. And the tar sands crude would generate 17 percent more of the carbon pollution that is driving climate change than conventional crude oil produces.

It would put our heartland at grave and needless risk of the kind of pipeline accidents we’ve seen nearly 6,000 times over just the past two decades. It would cross more than 1,000 rivers, streams and other waterways and pass within a mile of some 3,000 underground wells that supply irrigation and drinking water to communities and farms across Montana, South Dakota and Nebraska. And it would deepen our addiction to the fossil fuels of the past when we need to be investing in the clean energy options of the future.

That is not a project that serves our national interest. It is, instead, a project that’s about big profits for big oil, big payoffs for industry allies on Capitol Hill and big pollution for the rest of us.

If that’s what the Republican leadership in Congress wants to drop on the president’s desk, here’s what’s going to happen. The president is going to do what other presidents going back to George Washington have done more than 2,500 times: stand up for what’s best for all Americans, and veto this terrible bill.


By: Rhea Suh, The Blog, The Huffington Post, February 11, 2015

February 12, 2015 Posted by | Congress, Keystone XL, Presidential Veto | , , , , , , | Leave a comment

“The Pipeline To Nowhere”: A Monument To Wasting Colossal Sums Of Money On Dirty-Energy Infrastructure

When Maria van der Hoeven summed up the 20-year outlook for global energy investment in London last year, she identified a couple of daunting challenges.

The amount of money required by 2035 is a staggering $48 trillion, the International Energy Agency chief and former Dutch economy minister said. And it’s not clear how many of those trillions of dollars will power climate-friendly options.

“Will policymakers succeed in steering investment towards a cleaner, more secure energy system — or are we locking in technologies and patterns of consumption that store up trouble for the future?” she asked.

There’s no better example of what van der Hoeven meant by “storing up trouble for the future” than the Keystone XL pipeline.

After years of being flustered by President Barack Obama’s procrastination, the pipeline’s conservative backers in Congress are trying to force him to green-light this conduit for some of the world’s dirtiest, most expensive, and most dangerous oil.

The House recently voted in favor of building the 1,200-mile pipeline for the 10th time. The Senate is poised to approve it too. Although dozens of Democrats are siding with Republicans in favor of this boondoggle, those lawmakers lack the votes, so far, to override the veto Obama has threatened.

Senator John Hoeven, a North Dakota Republican and a leading Keystone XL proponent, has turned into a broken record touting what he calls “vital energy infrastructure legislation.”

Despite their similar names and obsession with all things energy, Hoeven and van der Hoeven are polar opposites. She’s a leading player in the effort to wean the world off its dependence on oil, gas, and coal. He’s a “drill, baby, drill” type.

There are many good arguments against the $8 billion pipeline on environmental and labor grounds. People like founder Bill McKibben and groups like Media Matters need no help explaining them.

Here’s another reason why the pipeline shouldn’t be built: It’s a waste of money.

First, plunging oil prices matter. A lot. They’ve sunk below $47 a barrel, losing more than half their value since last June. Saudi Arabian Oil Minister Ali al-Naimi declared a few weeks ago that he doesn’t care whether oil goes as low as $20 a barrel, a 16-year low. It just might.

By some estimates, a barrel of oil must fetch at least $95 for profits to be extracted from Canada’s tar sands. It’s impossible to say when prices will rebound to that level or if companies will give up on that oil patch, leaving the Keystone XL without much (if any) heavy crude to move.

Ultimately, there could be no oil to haul from Alberta to Louisiana to be refined — or not, if the U.S. scraps its ban on exporting crude — and then shipped to, say, China.

More importantly, tar sands oil production may stop within a few years even if it does prove profitable. You see, global climate talks are heading in a direction that’s likely to result in countries and companies leaving large amounts of oil, gas, and coal in the ground.

A new study published in the journal Nature spelled out where and what kind of fossil fuels would need to be left unexploited. Its authors predict that virtually all Canadian tar sands oil production will stop by 2020.

If it’s built by then, there’d be nothing for the Keystone XL to transport. As a pipeline to nowhere, it would become a monument to wasting colossal sums of money on dirty-energy infrastructure.

John Hoeven should listen to Maria van der Hoeven. If he did, he’d realize the benefits of losing this political battle.


By: Emily Schwartz Greco, Columnist and Managing Editor of OtherWords; The National Memo, January 16, 2015

January 17, 2015 Posted by | Big Oil, Climate Change, Keystone XL | , , , , , | Leave a comment

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