Keystone XL Research Paper

Although President Obama’s decision to delay action on the Keystone XL Pipeline should have made this paper outdated, the Republican move to bring this issue back from the dead and try to sneak it in with the payroll tax cut has convinced me that this paper could still serve a purpose in the public hemisphere.  Even though it’s not my best work since it was the result of my ENGL 103 class (I’m not a literature kind of guy), I hope it might serve as a quick reference for why the pipeline should not be constructed.  I decided to not attach the works cited or images, but I do have them still if someone wants to see them.


Keystone XL Pipeline:  In America’s National Interest?

            The State Department’s in charge of analyzing this, because there’s a pipeline coming in from Canada. They’ll be giving me a report over the next several months, and, you know, my general attitude is, what is best for the American people? What’s best for our economy both short term and long term? But also, what’s best for the health of the American people? Because we don’t want for example aquifers, they’re adversely affected, folks in Nebraska obviously would be directly impacted, and so we want to make sure we’re taking the long view on these issues. – President Barack Obama on the Keystone XL Pipeline (Berman).

Through the text of the preceding quote by U.S. President Barack Obama, the contemporary issue of whether to approve the construction of the controversial Keystone XL Pipeline is addressed in very basic terms.  However, this issue requires a deeper and more thorough analysis due not just to its complexity, but its potential to have long-term impacts on the United States.  The central question is:  “Is the pipeline in America’s national interest?”  While President Obama awaits the State Department’s official response, the American people have taken a position and chimed in with their own opinion (Figure 1).  Only through a comprehensive understanding of the state of America’s energy portfolio, the specifics of the Keystone XL project, and the actual economic and environmental impacts, does the pivotal question of the pipeline, “In America’s National Interest?,” become answerable with sufficient certainty.  Through exploration of these areas, the conclusion that the Keystone XL Pipeline is not in America’s national interest can be drawn.

BACKGROUND

Since the construction of the first commercial oil well, the United States has become steadily more and more addicted to oil as an energy source (“The Story of Oil in Pennsylvania”).  In 2010, the United States consumed about 19.1 million barrels of petroleum products daily.  Of that, 11.8 million barrels were imports from other countries.  While the United States does import around half of its petroleum products, only about a fifth (18%) of the petroleum products come from the Persian Gulf countries.  Despite the small percentage, this still represents a national security threat that cannot be solved by an increase in domestic production (“EIA’s Energy in Brief”).  Therefore, importing oil from more stable and friendly countries is the best option available apart from a transition to renewables and herein lies the primary reason, apart from jobs, that the government supports the pipeline.

Submitted to the State Department in 2008, the Keystone XL Pipeline project is a relatively new endeavor.  Since the project would connect the United States with a foreign country, it necessitates the approval of the State Department through a Presidential Permit (“Keystone XL Pipeline Project”).  The State Department’s decision ideally focuses on and answers the question: “Is this project in the United States’ national interest?”  Once the State Department completes its assessment, it communicates its findings to the President through a National Interest Determination and final Record of Decision.  Another aspect of its report is the Environmental Impact Statement; this part investigates the project’s compliance to the National Environmental Policy Act.  Together, these three documents inform the President to make his final decision (“The Keystone XL Pipeline: Role of the U.S. Dept. of State”).  Originally, the final decision was supposed to be made on or by November 1, 2011, however, recent controversy and environmental activism has pushed the final decision back further.  Concerning the pipeline itself, TransCanada Corporation, “a publicly traded Canadian pipeline and power generating company,” would both construct and own the pipeline.  In the proposal, the pipeline would start in Hardisty, Canada, connect to the existing infrastructure in Steele City, Nebraska until Cushing, Oklahoma, then head into Texas (Figure 2).  Thus, the 36-inch pipeline would travel through Montana, South Dakota, Nebraska, Kansas, Oklahoma, and finally into Texas with about 830,000 barrels per day when running at peak rate (Perrin).  The total cost for the United States portion is estimated at 7 billion.  One of the unique aspects of this pipeline, and an issue for environmentalists, is the type of oil that the pipeline would transfer.  Unlike the majority of pipelines, this one would transport a type of oil referred to as bitumen.  Naturally mixed with sand and water, bitumen is a viscous type of oil that requires heavy processing to turn into conventional oil (Thomas-Müller).  In fact, tar sands are mainly sand, clay, and water (90%) while the bitumen makes up only 10% of the mixture.  The inefficiency of this resource is even more apparent in this staggering fact; one barrel of oil requires around three tons of tar sand and two to four barrels of water to produce.  With water becoming an ever more scarce resource, this is a big problem.  Finally, tar sands processing produces three times the carbon dioxide emissions of traditional oil processing (“A Sticky Problem”).  Understanding the details of the project helps form a clearer picture of the decision at hand.

ARGUMENT

While supporters of the pipeline emphasize its economic impact, the opposition focuses primarily on the environmental impacts.  Jobs are on the minds of many Americans because of the recent economic downturn and any opportunity to create new jobs will be inherently emotionally charged.  On the other hand, the project represents a serious environmental threat not only to the immediate area of the pipeline and the fragile Canadian forests surrounding the tar sands, but also to the future of petroleum use in America and consequently carbon emissions on a global scale (Sweeney and McKibben).  Only an objective analysis of the pipeline project will result in a decision that successfully aligns with the country’s national interest.

Economic benefits are among the most touted by supporters of the pipeline, but how much validity is there to the job estimates endorsed by TransCanada?  There have been two major analyses addressing jobs, one from the Perryman Group (TransCanada’s official estimate) and one from the Department of State.   While the two estimates do not seem to differ too much on a state-by-state basis, the net estimates vary by over 75,000 jobs (in terms of one year of employment for one person).  According to “TransCanada Exaggerating Jobs,” the TransCanada Keystone XL Pipeline would “generate 3-year, temporary jobs for 1,668 people, with only 167 jobs going to local workers.”   But, these are only two of the job estimates put out to the public, what about the other ones?  Looking at the Chamber of Commerce’s estimates, the issue becomes even more scattered.  According to the Chamber of Commerce, the pipeline would support 250,000 jobs (“Chamber of Commerce Letter”).  Because of the heavy ties between members of the Chamber of Commerce and the oil industry, this estimate could hardly be called objective in nature.  However, there is another estimate that appears to be very objective, Pipe Dreams? by Cornell University.  In its report, the Cornell University Global Labor Institute addresses the major myths surrounding the pipeline that have led to skewed job estimates.  Through its analysis, the Cornell Global Labor Institute found that people already employed by TransCanada will conduct a majority of the work for the pipeline and that the Perryman Group incorporated previously completed projects in its estimate.  The Cornell report’s estimate ultimately comes out to between 2,500 and 4,650 temporary construction jobs.   The report also takes note of the price increase that will occur in the Midwest because of the oil that will be diverted to Texas and how that effectively negates some of the jobs that will be created.  Therefore, at best, the Keystone XL Pipeline will create a couple thousand temporary jobs, clearly nothing substantial (Pipe Dreams?).  As Bill McKibben states, “the job crisis is no excuse for bad policy” (Sweeney and McKibben).

Environmental impacts of the pipeline will occur on a local and global scale.  On a local level, the pipeline runs right over the Ogallala Aquifer (Figure 3).  This aquifer extends through eight states and is one of the world’s largest known aquifers (“Ogallala Aquifer”).  One of the primary concerns is that the aquifer is relatively close to the surface and therefore oil spills from the pipeline might contaminate the aquifer (Parfomak).  Specifically, benzene is a very problematic component of the tar sands and with rainfall, would permeate through the soil into the aquifer, especially in the Sandhills of Nebraska (Stansbury).  The Ogallala Aquifer not only supplies drinking water for over two million Americans, but it also provides about one third of irrigation water (Savage).  Along with endangering the Ogallala aquifer, the pipeline could potentially spill into one of the numerous rivers the project passes over.  The Missouri and Yellowstone Rivers are two of the most important of the 1904 waterways the pipeline route crosses and a spill into either of these rivers would pollute the drinking water of thousands of people and severely damage sensitive ecological areas that contain endangered species (“Ogallala Aquifer”).  While all of these leak scenarios are entirely possible, it is important to look at the probability of a spill and the frequency of spills in similar existing pipelines.  As expected, TransCanada’s estimate on the pipeline’s spill frequency is substantially smaller than independent estimates.  Over the lifetime of the project (50 years), TransCanada estimates that there will be 0.00013 spills (of 50 barrels or more) per year per mile; this correlates to about 11 significant spills over the life of the project.  Yet, TransCanada made some problematic assumptions to form this estimate.  First off, they assumed that the pipeline would only have half the number of spills as their other pipelines because of superior construction.  While this would be a valid assumption if the Keystone XL Pipeline were a conventional pipeline, this project involves a more corrosive oil form that will be pumped at higher temperatures and pressures.  On top of this, they ignored relevant historical data that suggests spills are more frequent than their base estimates.  Therefore, a more reasonable spill frequency based on historical data and considering the specifics of the pipeline is 0.00109 spills per year per mile, which correlates to around 91 major spills during the pipeline’s lifetime (Stansbury).  A good historical comparison is TransCanada’s Keystone 1 pipeline; in its first year a total of 23,000 galloons were spilled, which is significantly more than TransCanada predicted.  This project was only completed a couple of years ago and relies on relatively new construction techniques that are for all intensive purposes, roughly equivalent to the ones that TransCanada would use in the Keystone XL project.  Clearly, their estimate for the Keystone XL pipeline is very inaccurate (Savage).  On a more global level, the pipeline perpetuates the United States’ addiction to oil.  This has serious implications for global carbon emissions and climate change. While partisan America has made climate change a matter of opinion, the global scientific community unanimously asserts that climate change is not only real, but anthropogenic (Dunlap).  In order to mitigate the inevitable consequences of climate change, the world needs to switch to renewable energy sources with extreme urgency to reduce carbon emissions.  The United States is a major contributor of greenhouse gases and hold considerable influence in the world.  Allowing the pipeline to be constructed would further cement its addiction to fuel sources that it needs to move off of and sets a poor example for the rest of the world.  Thus, the environmental implications of the pipeline are very significant and should be taken into account (“EIA’s Energy in Brief”).

Further evidence of why the pipeline should not be approved comes from corruption involving TransCanada, the State Department and the environmental review.  As explained in the background, the pipeline is required to go through an environmental review in addition to a National Interest Assessment (“Keystone XL Pipeline Project”).  While the relationships and corrupt practices between the U.S. government and oil companies are multi-faceted and kept hidden from the public for the most part, some of the corruption in the Keystone XL pipeline project was exposed and is exemplified in the following examples.  The first instance concerns emails between the US State Department and TransCanada lobbyists.   An analysis of the obtained emails showed that they “reveal at times an almost collaborative relationship between Marja D. Verloop, an energy and environment counselor for the State Department, and Paul Elliott, a lobbyist representing TransCanada.” (“Emails Reflect U.S. Bias”).  However, the corruption surrounding the environmental review is much more significant.  On a high level, a company with ties to TransCanada conducted the environmental impact study.  To get into specifics, TransCanada was allowed to influence the State Department to pick Cardno Entrix.  Cardno Entrix is an environmental contractor that lists TransCanada as one of its major clients and surprisingly is also in charge of taking care of the U.S. Department of State’s website on the Keystone XL Pipeline Project (Rosenthal).  So, it comes as no surprise that the conclusion of the report was that the pipeline would have “limited adverse environmental impacts.”  In light of the environmental impacts laid out above, clearly there is a conflict of interest and the environmental review was not formulated objectively (“Pipeline Review”).  This corruption was a rallying point for protestors and their adamant rejection of the pipeline hints at American citizen’s views on whether the pipeline is in the United States’ national interest.

While just over a month ago a National Journal poll of energy insiders found that the pipeline would be easily approved, non-violent action by protestors has turned the Keystone XL Pipeline project around just recently.  On November 6th, over 10,000 American citizens circled the White House in protest of the corruption and the pipeline in general.  Groups around the country such as the SSREC (Southeast Students for Renewable Energy Conference) in Asheville held solidarity events with those in Washington (Dorner).  Earlier in the year, over 1,200 people were arrested for civil disobedience outside of the White House (Stewart).  In addition, fourteen senators and congressmen sent a letter to the Office of the Inspector General asking for an investigation into the environmental review (Johnson).  As a result of these events, President Obama announced on November 10th, 2011 that the project would be sent back to the State Department for a re-review.  In a public statement, President Obama mentioned climate change and the pipeline’s route as two issues that would need to be re-assessed.  While the pipeline was not outright rejected by President Obama, analysts say that this delay will “effectively kill” the project.  Environmental activist groups are counting this as a win, but are prepared to fight if TransCanada insists on building the pipeline at all costs (McKibben).

Therefore, the Keystone XL Pipeline project is not in America’s national interest.  Not only are the economic benefits touted by TransCanada unfounded, but the environmental implications are severe.  The corruption that was uncovered between TransCanada and the US government is part of a much larger issue, but in this context served as a warning sign of the false objectivity of the pipeline review.   As exemplified by the 1,200+ arrests and 10,000+ protestors, the general American public is not in support of the pipeline.  TransCanada is looking for more profit, not looking out for America’s interest.  From recent events, the pipeline is now being declared dead and this represents a big win against Big Oil.  The decision made by President Obama hints at the true answer to the question “In America’s National Interest?”

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