A Second Look at the KXL Debate

Following last week’s presidential debate, The Wall Street Journal and its contributors addressed a debate-worthy topic in its own right that they say will undoubtedly remain a focus in this election season: the Keystone XL pipeline. Setting up a little debate of its own, WSJ invited president of the Natural Resources Defense Council Frances Beinecke to argue against the project, and UC-Davis professor and energy expert Amy Myers Jaffe, to argue in favor.

While Ms. Myers Jaffe brings up many of the same points we’ve been making in fact checks for months now, including the fact that oil sands crude will find a market with or without KXL, there were several points that went uncontested in Ms. Beincke’s argument against the pipeline that we’d like to dissect.

So think of OSFC as the Jim Lehrer of the KXL debate – or maybe more like the James Carville – as we attempt to keep the NRDC in check on their all too familiar argument against this vital pipeline project.

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NRDC: “A tar-sands pipeline built across our nation’s heartland, from Canada to the Gulf of Mexico, would cross sensitive watersheds and pristine lands.”

FACT: Repeated claims that KXL will run through “pristine lands” are so two Supplemental Environment Reports ago. TransCanada has submitted not one, but two route proposals to the Nebraska Department of Environmental Quality that avoid the sensitive Sandhill region; first in April 2012 and again just last month after listening to extensive feedback from Nebraskans in order to move the route further from the sandy areas of the aquifer. The latest route proposal also further limits any potential impacts to shallow water areas it passes, as is laid out in the company’s press release.

NRDC: “An earlier pipeline in TransCanada Corp.’s Keystone system had more than a dozen leaks in its first year of operation in the U.S.”

FACT: It’s true that a dozen spills have been recorded, but the majority of them were minor, averaging just five to 10 gallons of oil and – get this – didn’t even occur on the pipeline. They originated at pumping stations and as was stated by TransCanada, “[t]he vast majority of that oil was confined to our property and in all cases was cleaned up quickly. None of the incidents involved the pipe in the ground – the integrity of Keystone is sound.”

NRDC: “The mining of tar sands destroys ancient forests and leaves gaping pits that stretch for miles.”

FACT: Only 3 percent of the oil sands resource can actually be recovered via mining. The other 97 percent would be recovered via in situ (more similar to conventional drilling technology). And the land area being impacted by mining is only roughly the size of Charlotte, NC – a relatively small area when compared to the vast boreal forest. Before development can even begin, energy producers are required by law to submit a land reclamation plan and continually reclaim land throughout the life of a project. The mining process requires the use of tailing ponds, but they are in no way exempt from the reclamation process and only account for 20 percent of Canadian oil sands projects.  The other 80 percent, as just mentioned, is for in situ projects.

Advancements in technology play a key role in extraction and reclamation processes every day. The speed of reclaiming the tailings ponds has been reduced from years to months. Additionally, in an ongoing study of the effectiveness of reclamation efforts, Canadian oil sands company Syncrude and their partners at the Institute for Bird Populations have found that the diversity of bird species living on reclaimed oil sands mining sites is similar to what would be found on a natural habitat.

NRDC: “[Oil sands crude] creates air pollution that can cause acid rain and health problems in neighboring communities, while water pollution from an accident involving massive waste dams connected to tar-sands operations could find its way to the Arctic Ocean and beyond, threatening fisheries.”

FACT: This might as well be a Mad Libs game – despite having no ties to the oil sands or incidents involving oil sands crude oil, the NRDC references the Arctic Ocean as a body of water potentially in danger as a result of development. The key thing to remember here is that oil sands crude does not pose some unique threat to infrastructure or the environment. Crude oil produced from Canada’s oil sands region has similar characteristics to other types of crude that have been transported across the United States via pipeline for decades.

NRDC: “Numerous studies show that production of oil from tar sands results in significantly more carbon-dioxide pollution than the production of conventional crude oil.”

FACT: As the Congressional Research Service explains, opponents of the oil sands tend to ignore a significant stage in the life of a fuel – the combustion phase – which accounts for 70-80 percent of emissions. Myopically focusing on the singular aspect of production of the oil sands would show generations of more greenhouse gas emissions. But on a lifecycle, or well-to-wheels, basis, greenhouse gas emissions from the oil sands are on par with the average barrel of U.S. imported crude oil (See IHS CERA’s full report on the subject).

NRDC: “And to the extent the oil is marketed in the U.S., it will only serve to worsen our addiction to fossil fuels, just as we are finally beginning to make headway in breaking that dependence. … Already, U.S. production of oil is at its highest level in years. And we are also making significant progress in reducing our demand for oil.”

FACT: As a result of an increase in the use of renewable fuels and a global economic recession, demand for oil has decreased in recent years. However, even with increased development of green technologies, the U.S. is estimated to increase petroleum consumption by 0.7 million barrels per day over the 2010 rate, according to the Energy Information Administration (EIA). EIA projects that even doubling the amount of renewable energy consumed in the U.S. wouldn’t be enough to match current oil consumption rates.

Editorial note: Does it strike anyone else as odd that the NRDC, of all organizations, leans on the fact that U.S. oil production is up as a reason not to use oil sands crude?

NRDC: “Remember also that the pipeline won’t, as some proponents claim, lower the price of gasoline in this country. Oil is traded and priced in a global market, and the amount of oil that would flow through the pipeline wouldn’t be enough to significantly affect global prices, especially with demand on the rise from developing countries world-wide.”

FACT: There is some truth in this statement: gasoline prices are largely based on the price of oil, which is determined by the global market and the laws of supply and demand. But Ms. Beinecke clearly didn’t check her organization’s talking points on this subject.

Back in May, NRDC published a report arguing that Keystone XL would in fact increase oil prices and subject Americans to more pain at the pump. In our previous debunking of this NRDC report, we cited EIA, which concluded that KXL “would not adversely affect Midwest gasoline consumers” and that “[g]asoline prices in all markets served by PADD I [East Coast] and III [Gulf Coast] refiners would decrease, including the Midwest.” In short, even the Department of Energy agrees more supply flowing into the market to meet demand should have a positive effect for consumers.