Oil-Logic: When a Leaky Pipeline Justifies... More Leaky Pipeline!
In today's through-the-looking-glass news, oil lobbyists at the American Petroleum Institute have used two recent crude leaks on TransCanada's Keystone Pipeline as an argument for extending the project by another 1,661 miles. So far as the industry is concerned, the real news here is how well the federal government (and the company) has mobilized to deal with the spills -- not the risk of environmental catastrophe itself.
It's as nutty and bizarre an example of both Beltway and oil-industry logic as you'll see anywhere -- but that doesn't mean it won't work.
The quick back story
TransCanada's year-old 1,300-mile Keystone pipeline, which runs from Alberta to Oklahoma, leaked twice last month, including one spill of more than 400 barrels. The U.S. Pipeline and Hazardous Materials Safety Administration (PHMSA) ordered TransCanada to suspend operation of its Keystone pipeline until the agency was satisfied with repairs. The order was lifted a day later. Environmentalists have seized on the leaks as the primary argument against Keystone XL, a proposed 1,661-mile pipeline that would bring crude from Canadian oil sands all the way to the Gulf coast.
A sign of what's to come
To API Executive Vice President Marty Durbin argued that the government's order shows the current system of federal oversight works. As he told reporters on a press call Monday:
What we've seen over the last several weeks here is it's almost proven that we have an effective regulatory process in place. In some ways it actually supports the approval of the XL pipeline.Of course, you might find this logic less convincing if you're more concerned about actual leaking oil than "effective regulatory processes." Just imagine how you could deploy the same sort of argument in debates over drilling in the Arctic or to opening up new offshore-drilling regions in the Atlantic:
Yes, we've had some spills. Nothing horrible, just a few hundred barrels here and there. But I tell you, the government does a bang up job every time there's a spill. They get in there and demand -- demand! -- that it's fixed immediately. It's a perfect system.What's at stake
Obviously, the financial stakes are high for TransCanada. It's less important for Canadian oil-sands producers. A pipeline would certainly make it easier to deliver the large volume of oil-sand crude to market. But even without it, the demand for that oil will continue and producers will find a way to deliver.
So, why is the U.S. oil industry fighting so diligently on TransCanada's behalf? The Keystone proposal is no longer about a pipeline. It's become a broader, ideological fight that pits energy security and economic gain against long-term environmental fallout.
The fight over the pipeline, which has been in regulatory limbo for three years, could drag out even longer than expected thanks to added pressure from the EPA. In a letter dated June 6, the EPA ripped the State Department for its ""insufficient" analysis of the project's environmental impacts and called for increased scrutiny, especially in light of the 11 leaks that have occurred along the existing pipeline during its one-year lifespan.
Photo from Flickr user jmegjmeg, CC 2.0
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