The oil will be refined into diesel and exported,Lorne Stockman,research director of Oil Change International,said. His group opposes the pipeline.
According to the report,the crude will be delivered from Hardisty,Alberta,by the 1,980-mile,36-inch diameter Keystone XL pipeline to refiners in Texas that are focused on exports.
“Europe has a diesel deficit,Latin America has a petroleum product deficit generally and we are increasing exporting our surplus to these countries,” Stockman said.
Stockman and others,including a high-ranking official from the company that proposes to build the pipeline spoke last week at a discussion about whether the pipeline was in the national interest.
Alexander J. Pourbaix,president of Energy and Oil Pipelines,TransCanada,which plans to build the pipeline,said other people on the panel were better able to answer the export question.
Lucian Pugliaresi,president of the Energy Policy Research Foundation,said total U.S. oil exports are small.
“If you want to control the rate of consumption in the U.S.,then it’s got absolutely nothing to do with Canadian oil,” Pugliaresi said.
Paul Sullivan,a professor at the National DefenseUniversity and Georgetown University,said the U.S. is exporting more oil because Americans have been buying less gasoline in the poor economy.
“This is essentially refineries looking for markets,” Sullivan said. He predicted exports will decline as the economy improves.
U.S. diesel consumption is decreasing and will continue to do so,Stockman said. The only genuine energy security strategy for the U.S. is to sell the diesel abroad,he said.
“Canadian oil has not and cannot insulate America from oil supply disruptions or oil price shocks,” Stockman said.
He said the pipeline won’t reduce U.S. dependence on Middle East oil.
According to the U.S. Energy Information Administration,the U.S. consumes essentially all Canadian petroleum exports. In 2010,Canada exported 2.53 million barrels of oil per day to the United States.
The Keystone XL pipeline would extend through Saskatchewan,Montana,South Dakota,Nebraska,Kansas and Oklahoma before reaching refineries in Texas. It would transport from 700,000 to 900,000 barrels daily of crude oil extracted from tar sands to the U.S.,according to the company.
Hundreds of pipeline opponents were arrested in front of the White House over the summer.
The protests were aimed at persuading President Barack Obama to reject Calgary-based TransCanada’s application for a permit to build the pipeline. The environmental groups say they will file suit if the permit is approved.
Opponents say extracting oil from the tar sands is more environmentally damaging than drilling because it involves strip mining and blasting the mine with hot water. Air pollution from equipment and trucks is another issue.
Anthony Swift,energy policy analyst for the Natural Resources Defense Council’s International Program,said rejecting the Keystone XL pipeline is the same as getting 6 million vehicles off the streets.
Environmentalists also fear the pipeline could damage the Ogallala Aquifer,the most important source of ground water in the United States.
Swift said the aquifer provides drinking water for 2 million Americans,nearly a third of the country’s irrigation water and supports $20 billion a year in agriculture.
Swift referred to a study done by John Stansbury a University of Nebraska professor of environmental water resources engineering. He found that,in the worst-case,the pipeline could spill 7.9 million gallons of crude in the Nebraska Sandhills and contaminate 4.9 billion gallons of water in a plume of 15 miles long.
“I can’t speak to that in the case of all aquifers,” Swift said. “But I can say the reason we haven’t had a spill in the Sandhills is because no pipeline company has ever proposed building a pipeline through the Sandhills.”
However,hydrologist Jim Goeke,a retired Nebraska professor,said in an interview with KOLN/KGIN in Lincoln,Neb.,that a leak would not affect the majority of the Ogallala Aquifer because the geology of the aquifer would keep the oil within 10 feet of the pipeline.
According to TransCanada,21,000 miles of pipeline already cross Nebraska,including 3,000 miles of hazardous liquid pipelines,and many cross the Ogallala Aquifer. In Nebraska,17 of 18 oil-producing counties sit atop the aquifer.
Pourbaix said pipelines are the safest method for transporting oil and safety has improved. From 2001 to 2008,the number of spills per 1,000 miles of pipeline decreased by 63 percent,he said.
Pipeline supporters argue it will be good for the economy.
Sen. John Hoeven,R-N.D.,said the pipeline will create more than 200,000 construction jobs and 250,000 permanent jobs,$6.5 billion in new personal income for U.S. workers and $600 million in revenue for state and local governments.
Rep. Gene Green,D-Texas,said refineries in his state will hire more workers and make the state more prosperous. Green represents the Houston area.
Sullivan said it is better to import oil from a friendly nation than to continue to buy more oil from a less-stable Middle East.
If the U.S. does not seize the opportunity to build this pipeline,Canada will sell the oil to customers in Asia,particularly China,Sullivan said.
The State Department released the final Keystone XL environmental impact statement Aug. 26 and began a 90-day consultation period with eight other federal agencies.
The department is conducting nine public meetings in affected communities in the next two weeks. The department is expected to make a decision by the end of the year.
Reach reporter Lyudmils Tsubiks at [email protected] or 2012-326-9867. SHFWire stories are free to any news organization that gives the reporter a byline and credits the SHFWire.