The Keystone XL: A Funnel For Money to the Political Parties; Not Cheaper Oil For Consumers!

Charlie Barber ’60,
The High Plains Reader, Fargo, ND, January 29, 2015.
Reprinted by permission of the author and The High Plains Reader

“Obama plans to veto Keystone legislation,”

– Bismarck Tribune, 1/7/15

 

“Congressional Republicans can stage as many high-profile votes on Keystone XL as they like, but they can’t force Calgary-based TransCanada to build it…”
“Tougher regulations on tank cars and oil-by-rail make sense. But they are also unlikely to significantly slow the trend. Oil producers in Canada (as well as those in North Dakota) have grown accustomed to shipping their product by rail as it gives them more marketing options that those that are available with a single pipeline like Keystone XL…”

– Robert Bryce, The Daily Beast, 11/19/14

 

“We Have the Best Congress Money Can Buy.”

– Will Rogers

 

As I filled up my gas tank yesterday in Mandan at the usual rock bottom prices of the past few months, and watched myriad BNSF oil tankers rumble by, it occurred to me how nonsensical it was for the first major legislation touted by the new Republican majority in Congress to be for the Keystone XL pipeline – a vehicle for Tar Sands bitumen, not just one of the dirtiest, but also the least cost effective of fossil fuels in the market place.

It costs $85. a barrel to put out Tar Sands bitumen in Alberta, and another $15. to transport that extra heavy stuff, while the Saudis are pumping out petroleum at $10. a barrel. Bakken sweet crude, at $55. a barrel, is far cheaper to produce than petroleum from Canadian Tar Sands. With only the Mandan, ND and Billings, MT refineries in local play, delays in building pipelines like the [Saddle Butte] Enbridge from the Bakken to Minnesota [see HPR, 2/27/12; Bismarck Tribune, 1/11/15] have kept transportation costs higher than they needed to be, but, as the billboard ad in Bismarck says, it is “U.S. Oil From U.S. Soil.”

With the Enbridge line in place from the Bakken to Great Lakes refineries, and with shorter, traditional routes from Alberta to Vancouver, B.C. producing 20+ barges laden with petroleum for world markets leaving through Puget Sound every day, everyone in the oil industry, large or small, knows that the Keystone XL is a bad economic bargain. Every legislature in oil producing states knows this as well. There is no need for it.

Cleaner fuels within and without the fossil fuel industry are also becoming the rage among some of the largest corporations. Electricity through conversion of natural gas through tax breaks, rather than burning it off through tax avoidance, has also caught the imagination of big players here in North Dakota like MDU and Basin Electric.

Toyota is heading away from fossil fuels altogether by making available thousands of hydrogen fuel cell patents, royalty free, for cars ready to launch between 2015 and 2020 which will emit only H20 from their tail pipes. And wind, solar, geo-thermal and other non-fossil fuel sources of electricity, heating and cooling are beginning to show their profitability as well as their utility.

As for the U.S. Congress, House Speaker John Boehner [R-OH] and Senate Majority Leader Mitch McConnell [R-KY] are not pushing the Keystone pipeline because of its economic value to the United States, Canada, China, or even big corporations behind it, but simply to demonstrate they are willing to do the political bidding of Big Oil, regardless of the consequences. For all his insincere posturing about “lack of bi-partisanship” from the White House in 2015, Senator McConnell, a chief barrier to bi-partisanship from 2009-2014, is on to something. Big Oil has been wholly bipartisan in their intimidation of Congress, owing to obscenely large campaign contributions, often obscured by the twisted logic of “Citizens United,” and doled out or withheld pending the cooperation or non cooperation of the politician in question.

As for Canada, the Province of British Columbia has shown the kind of gumption vis-a-vis Big Oil that has been missing in North Dakota or the U.S. Congress. They have banned the use of pipelines now used for liquefied natural gas from being converted to transport oil sands crude from Alberta to international markets from Puget Sound. Why can’t we in the U.S. show as much sense as the Canadians?

Of course, what doesn’t make sense economically, sometimes makes perfect political sense. There is the possibility that Speaker Boehner and Majority Leader McConnell already know that the Keystone XL is dead in the water for economic reasons; that even if they should succeed in overriding President Obama’s threatened veto, the thing will not be profitable. Instead, they are just trying to show the Big Oil boys that the Republican Party is the best place to drill for Presidential and Congressional “oil” in 2016.