Keystone XL

EPA Hates On the Keystone XL Pipeline: Gives Obama an Excuse to Deny Construction Permit

A novel idea: Why not let the builders decide whether or not it is economic to construct?

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Keystone Map
TransCanada

Yesterday, the Environmental Protection Agency released its letter to the U.S. State Department in which it outlined its objections to approving the construction of the Keystone XL pipeline. That pipeline would transport daily more than 800,000 barrels of crude oil derived from Canadian oil sands to Gulf Coast refineries. The State Department is involved because the president has the authority to rule on whether such cross border projects are in the "national interest" or not. Big surprise! The EPA thinks its not because the carbon dioxide emissions from producing and burning the petroleum from the project would contribute to man-made global warming.

In addition, the State Department's initial evaluation concluded that the market for oil sands crude was so strong that it would be produced and shipped in more expensive and environmentally deleterious ways—mainly by rail cars—if the pipeline were not approved. Since approval for the project has been delayed for about six years, oil prices have fallen steeply. The EPA now observes:

The Final SEIS [Final Supplemental Environmental Impact Statement] concluded that given global oil prices projected at that time this difference in shipment costs would not affect development of oil sands, which would remain profitable even with the higher transportation costs of shipment by rail. Therefore, the Final FEIS concluded that although development of oil sands would lead to significant additional releases of greenhouse gases, a decision not to grant the requested permit would likely not change that outcome, i.e., those significant greenhouse gas emissions would likely happen regardless of the decision on the proposed Project. This conclusion was based in large part on projections of the global price of oil.

Given the recent variability in oil prices, it is important to revisit these conclusions.

For some perspective consider that the addtional amount of emissions from the project would amount to one-half of one percent of total greenhouse gases released annually in the U.S., according to Bloomberg Business.

With regard to oil sands production costs, the New York Times yesterday quoted Canadian economist Andrew Leach:

"You're looking at a reduction of the growth rate at current prices, a stall." He estimates that the production cost for synthetic crude from the major open pit mine projects is $31 to $39 a barrel, at current exchange rates. He added, though, that a few projects with production problems had much higher costs.

The industry thinking, he said, is, "I'm willing to burn through cash on this project because in the long term it will be worth it."

Various environmental lobbying groups issued comments arguing that the EPA's conclusions mean that the pipeline "fails the President's climate test." Here are just a couple:

Danielle Droitsch, Canada Project director at the Natural Resources Defense Council: "The EPA's assessment is spot-on. There should be no more doubt that President Obama must reject the proposed pipeline once and for all. If built, it would transport Canadian tar sands oil – the dirtiest fuel on the planet – through America's heartland, only to be refined and then shipped abroad. The pipeline would threaten our waters, our lands and turbo-charge climate pollution. It's absolutely not in our national interest."

350.org Co-Founder Bill McKibben: "In a city where bureaucrats rarely say things right out loud, the EPA has come pretty close. Its knife-sharp comments make clear that despite the State Department's relentless spin, Keystone is a climate disaster by any realistic assessment. The president's got every nail he needs to finally close the coffin on this boondoggle."

Here's a novel idea; why not let the builders of the pipeline decide whether or not it is economic to construct?

Disclosure: Back in 2011, I went on a junket to report on the development of Alberta oil sands. My travel expenses were covered by the American Petroleum Institute. The API did not ask for nor did it have any editorial control over my reporting of this trip or, for that matter, any other reporting that I do. For more background, see my articles, "The Man-Made Miracle of Oil from Sand," and "Conflict Oil or Canadian Oil?"

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  1. Contribute to AGW? Holy shit, even assuming the worst predictions of AGW were true, how miniscule would the contributions of this pipeline be?

    I’m totally stunned at how much we live in the era of the Big Lie. Nothing small, no concessions to obvious reality or logic.

    1. It’s a millennial religion. Logic will not sway them from what they superstitiously “know” to be true.

      1. Try explaining to anyone how recycling contributes more to global warming than not. It’s kind of hilarious.

        1. I’ve mentioned this to my kids.

          Why would you recycle paper instead of burying it in a landfill? Because if paper companies farm the trees they use to make paper, then burying the paper in the landfill is carbon sequestration!!

    2. If the Republicans were smart and had balls, which of course they are not and don’t, they would pass amnesty giving the President everything he wants on the issue at the price of also banning the EPA from regulating CO2 or for AGW to ever be considered in making any federal policy.

      Let him choose between the Green idiots or the Latino vote. He would of course choose the Greens. But him doing that would allow the GOP to tell Hispanics that no matter what the Democrats tell them, they care more about idiot Green billionaires than they do about them.

    3. I personally think that not building the pipeline will contribute more to global warming than building it will. Even the EPA concluded “…that although development of oil sands would lead to significant additional releases of greenhouse gases, a decision not to grant the requested permit would likely not change that outcome”. So, they determine that the oil is going to be extracted and refined regardless of the pipeline. So, instead of sending it trough a pipeline that shouldn’t emit any greenhouse gasses in transportation. They are going to transport it with trucks and trains that do emit greenhouse gasses. Can someone explain to me how I’m not supposed to see this as a favor to Warren Buffet and his BNSF Railway? Especially when you consider what the Wikipedia page says about BNSF railways. “For instance, the railroad hauls enough coal to generate roughly ten percent of the electricity produced in the United States.” So, it really seems to me that they aren’t concerned about how “green” the cargo is. Only about the green generated by it’s transport.

    4. “Big surprise! The EPA thinks its not because the carbon dioxide emissions from producing and burning the petroleum from the project would contribute to man-made global warming.”

      This is why those retard congressional resolutions that declared “Climate Change is Real” and “Caused by Humans” matter. They give cover for opposition to just about anything.

  2. “the President’s climate test”

    I’ll bite. What’s that?

    1. “What keeps the money from greenies flowing?”

  3. So they are are arguing that the petroleum would not be processed and burned if the pipeline wasn’t built? Seriously?

    How does it compare to the impact of transporting some of it in the U.S. on Buffet’s diesel-electric trains? And shipping the rest to China on tankers?

    1. It doesn’t and the stuff will be burned anyway. But this is not about reason and logic. AGW is a religion for these people. It is about being chaste and not a part of the sinful world. Reason and logic have nothing to do with it.

      1. These are people in power. The “best and brightest” we’re supposed to totally defer to in this amazing technocratic nightmare they’ve constructed.

    2. I posted on another board that shipping all this oil by rail would eventually cause a huge accident and kill people. The pipeline is infinitely safer.

      A few minutes after my post someone from Canada posted that this had already happened an 47 people in Ontario were killed by a oil train accident.

      The greens already have blood on their hands for not supporting the pipeline.

  4. “Here’s a novel idea; why not let the builders of the pipeline decide whether or not it is economic to construct?”

    Because for some, its not a matter of simple economics.

    The objective, for those who believe that we need to limit the amount of carbon we put into the atmosphere, is to leave as much of that carbon in the ground as possible. Tar sands is an expensive proposition, and requires large investments. Its why oil companies want the pipeline built…they need it to keep price down and encourage further investment. Surely one way to keep as much of that dirty oil in the ground as possible is to discourage further investment. Is it still being shipped? Yes. But this is a chance to make sure it all isn’t shipped and burnt. The alternative is a poor one…dig it all up and burn it all.

    But if you’re going to rely on one government unit (The State Department) for the reasons why Keystone should be built, you really can’t complain about another government unit (EPA) who says something different.

    I have said this before…using the excuse “the oil will be shipped and burned anyway” is a poor one at best, because it can be applied to any fossil fuel anywhere until it is all dug up and burnt. Of course, that applies only if you believe that we have to begin to limit how much carbon we put into the atmosphere.

    1. Yes some people are superstitious idiots. We already knew that. You are not going to keep any of that oil in the ground. It will be used and transported another way. But you will be chaste and not a part of that sin.

      At this point there is no reason to further engage people like you in debate. For people like you, this is a religion and no amount of reason is going to persuade you. All we can do is do everything we can to kick you and your kind out of the public debate and marginalize you as much as possible.

      If you believe in AGW you are not a serious person and have no place at the table when it comes to debating policy. It is just that simple. Go off and pay for the world sins some other way than by making the rest of us cold and poor.

      1. I’ll give you the same advice John that I have given all the other folks here who really have nothing to say but sophomoric insults.

        If you don’t like what I say, don’t read it. A true Libertarian principle at work.

        Trust me on this, unless you are responding directly to me, I never seek out anything you have to say here.

      2. If you believe in AGW you are not a serious person and have no place at the table when it comes to debating policy.

        John, I have to take issue with this; it is the believers in Catastrophic Anthropogenic Global Warming who are the dangerous cultists. That’s the set of hypotheses that have been completely falsified by observation (the ones that make testable predictions, anyway). So-called lukewarmers, who are of the opinion that humans have had some impact on the climate have not had their hypotheses falsified – they haven’t really come up with hypotheses that provide testable predictions to differentiate them from the natural variability only hypotheses.

        Personally, I am not sure whether the lukewarmers or the natural variability proponents are wrong. But we can’t dismiss them as superstitious idiots as we can the CAGW guys.

        1. “‘ I am not sure whether the lukewarmers or the natural variability proponents are wrong”

          Neither am i, but the guy who thinks that any oil is ‘staying in the ground’ is still a dangerous idiot.

  5. This seems like a weird topic for Reason to be for. You know the Government will take peoples land in order to build the pipe line right?

    1. For some here, sadly, it doesn’t matter. Because its oil. And by the way, its not just the government taking the land, its a Canadian company attempting to use the US government to take a US citizens land.

    2. That’s not the point. IF the state department said “eminent domain for a pipeline project is a bad idea”, then Reason magazine taking a contradictory editorial position would be a “weird” thing.

      But it’s not what’s happening here. It would be as if the FDA argued against the genital mutilation of girls on the grounds that unmutilated girls having sex for pleasure would lead to more children being born with serious birth defects thereby burdening society.

      It’s a specious argument and should be called out no matter where one stands on the morality or legality of the pipeline’s construction.

    3. I’m not a fan of eminent domain, nor am I a fan of political decision-making governing something like this. There’s no basis at all for the federal intervention except politics.

    4. “the Government will take peoples land in order to build the pipe line right?”

      Technically its

      a) state and local governments

      that are going to

      b) pay people who refuse to come to agreement for easement rights which allow them to utilize a 50-foot wide strip of land that they will still own

      the payment agreements will be decided by local state 3rd parties on a case-case basis.

      and the total amount of land where these sorts of compulsions are occurring is a single-digit percent of the actual pipeline footprint, and far less than any comparable utility project.

      But seriously though = i love that people are suddenly pretending that they care about Eminent Domain just because Oil makes them wet their pants.

      1. *correction

        between A and B was supposed to be a blub clarifying that state govs would arbitrate the deals by which Transcanada/Keystone would compensate unwilling landowners for the rights to the easements

        not that states would be doing the paying themselves.

      2. Yes. “But eminent domain!” coming from people who think all of my stuff is on loan from the government is pretty rich.

        This particular issue is absurd. The environmental impact is certainly nothing serious, definitely not anything that is going to change AGW one way or the other, and we’re burning and transporting oil all over the place. It’s politics and nothing else whatsoever. What a stupid basis for “running” a country!

    5. Actually, I’d be pretty psyched if I owned land the pipeline was going to cross. Selling the small amount of land needed would be a good way to make a good chunk of money. Odds are most farmers would still be able to farm quite near the pipeline such that their yields wouldn’t be much affected by the land lost and the payout for allowing the pipeline to cross their land would be substantially worth it.

      My father-in-law was offered a good bit of money to allow power lines to cross his land. He turned them down, and they went a different route, but the offer wasn’t bad at all.

      1. Its your last sentence that applies. Your father had his reasons for not wanting the power lines, whether or not his neighbor was OK with it.

        Same here with the pipeline…you might be OK with it, but clearly a number of people are not. They are just like your Dad.

    6. Had to laugh, Alch, at the responses to you which only prove what I said…all must making excuses about how easy it will be, and that its not really taking property, its just things like easements.

      Funny, unless of course it was your land, and you had your reasons for not wanting a pipeline on it. But when its someone elses land, Libertarians here aren’t that concerned.

      Here, on this page is listed why one farmer is fighting it, and about halfway down is a pdf with the actual letter sent by a Canadian company seeking to condemn an American citizens land. It tells of all the things that Canadian company will be allowed to do on the simple easement…build fences, bring equipment onto land, clear whatever is on it…you know, all the things Libertarians aren’t that upset about when it comes to oil.

      http://billmoyers.com/2013/12/…..-pipeline/

      1. Had to laugh, Alch, at the responses to you which only prove what I said…all must(sic) making excuses about how easy it will be, and that its not really taking property, its just things like easements.

        ROFL!

        I suppose that if you exclude all the respondents but JWW and Gilmore that is a true statement.

        1. All but pro-lib proved it, including you.

          1. You just suck at reading comprehension.

            I said the EPA’s argument was a bunch of nonsense and that regardless of where people stood on the eminant domain issue, the EPA should be called on it.

            As it happens I am utterly opposed to eminent domain – even for road construction.

            1. What you did was make an excuse, rather than deal with what the commenter commented on…eminent domain. Instead for you it was back to EPA.

              But here is your chance…go ahead say it…you oppose keystone because it will be implemented through the use of eminent domain.

              1. ROFL – yes, because remaining focused on the topic at hand is being evasive. 😀

                I oppose any pipeline that is built through eminent domain.

                Now here’s your chance. Do you think the EPA is making a profound or silly argument? 😉

                1. From my point of view, its silly. For me, its all about keeping as much of that carbon in the ground as possible. Period. I really don’t think the price of oil has anything at all to do with it.

                  A meeting of the minds if ever there was one.

  6. Current major oil and gas pipelines. It’s amazing that the environment of the country has survived.

  7. This is so dumb. So the EPA is concerned about the CO2 from consuming the oil, which will happen no matter what method is used to transport the oil. But then they seem perfectly OK with the idea of shipping the oil via trains vs a pipeline. So what about that CO2? Trains aren’t CO2 neutral.

    1. “Trains aren’t CO2 neutral.”

      Neither are electric cars, but most idiots still believe that they run on fairy dust and the happy dreams of children.

    2. When one of Warren B’s oil trains catches fire and burns for two days, I don’t want to hear one.fucking.thing about it from the EPA.

      1. As the people out on Long Island can tell you this morning, trains aren’t exactly perfectly safe.

  8. “The EPA thinks its not because the carbon dioxide emissions from producing and burning the petroleum from the project would contribute to man-made global warming.”

    They aren’t even trying. Pathetic.
    All you ever have to do is look at who benefits financially. Obama cronies.

    Oh, look:

    http://www.theblaze.com/contri…..ent-obama/

  9. Good to see that there are still a few token libertarians around. Reason, and most of its readers now, are right-wing statist conservatives for the most part.
    Here is yet another issue in which big-money establishment ‘libertarians’ push their crony capitalist agenda dressed up in libertarian language.
    The correct libertarian response to the Keystone pipeline is be firmly against anything that is based on the state seizing land, or use of land, by eminent domain, and to be firmly against anything in which the government shields certain individuals from financial liability for their actions.
    Yet Reason once again, as always, takes the side of crony capitalism.

    1. Yet Reason once again, as always, takes the side of crony capitalism.

      Because pointing out the EPA is making a religiously based and irrational argument – an argument remarkably uncontaminated by any reference to eminent domain – = support for eminent domain.

      You know, when I found out that Robespierre died screaming in agony after his executioner ripped off the bandage holding his broken jaw in place, it brought a smile to my face.

      The fact that you selected that psychotic, who was willing to murder his way to building paradise on Earth, tells me that you are a particularly fucked up and depraved individual.

      Have you considered joining ISIS? Their revolutionary zeal might be right up your alley.

  10. Canada doesn’t even have the ‘dirtiest’ oil in the world, California does.

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