Posted on 04/01/2011 5:32:46 AM PDT by thackney
The Obama administration is still studying what to do about a proposed pipeline to send Canadian oil sands crude to Gulf Coast refineries.
But today, a House panel launched its own deliberations.
During a day of congressional events focusing on rising oil prices, the House Foreign Affairs Subcommittee on the Western Hemisphere examined whether the proposed Keystone XL pipeline could make a dent in the cost of crude or gasoline.
Republicans on the panel seemed to go into the hearing with their minds made up.
Rep. Connie Mack, R-Fla., the subcommittee chairman, said the pipeline was essential to “replacing foreign oil from thugocrats like Hugo Chavez in Venezuela with reliable allies like Canada.” In the meantime, he said, the pipeline’s construction could create tens of thousands of jobs in the U.S.
Rep. Jean Schmidt, R-Ohio, noted that the U.S. and Canada have tight bonds already — and the pipeline would give us a chance to supply American energy needs with oil supplies from a nearby ally.
“It’s always good to do business with our friends,” she said. “Getting the opportunity out there for another good supply of oil for our citizens in the United States makes sense.”
The State Department is conducting an environmental impact study of the 36-inch TransCanada Corp. pipeline and is on track to make a final decision about whether to approve the project by the end of the year.
Rep. Ted Poe, R-Texas, accused the administration of “stonewalling the project.” Poe added that is better to use a “safe, reliable pipeline” to transport oil than “tankers from the Middle East.”
But Rep. Eliot Engel, D-N.Y., stressed that the government has an obligation to do a thorough environmental study of the pipeline under the National Environmental Policy Act. The administration is bound by these “legal obligations,” Engel said.
“The State Department is in the process of reviewing the permit and drafting an environmental impact statement,” Engel said. “This is important work. . . that cannot be swept aside because one group or another wants to act with great haste.”
David Goldwyn, a former State Department envoy for international energy affairs, told a House Foreign Affairs subcommittee that the government’s environmental considerations are important.
“I think the State Department is being as deliberate as it can so that when it comes to a decision, that decision is beyond reproach,” Goldwyn said.
Conservationists complain the 1,700-mile stretch of pipeline would snake through Nebraska’s Sand Hills and Ogallala Aquifer on its way to southeast Texas refineries.
Environmentalists also argue that the pipeline would encourage oil sands production in Canada that will damage Alberta’s boreal forest while generating far more greenhouse gas emissions than conventional crude production.
Oil industry advocates fire back that oil sands extraction through open pit mining has been replaced with less invasive in situ techniques.
Jeremy Symons, a senior vice president of the National Wildlife Federation, said the pipeline would help oil companies to export refined products outside the U.S.
Pipelines already exist to send Canadian crude to the Midwest, but the proposed Keystone XL extension would allow the oil an easy route to the Gulf and out of the U.S., Symons said. “Once (oil companies) get it out of the Midwest and to a deep-water port, they can send it anywhere and charge higher prices,” Symons said.
I wonder how the Bakken shale developments in North Dakota and eastern Montana fit into this? There are already major bottlenecks in that transportation system that must be resolved. If the Bakken were allowed to feed into this system it would be a win-win for both Canada and the USA.
There have been a few pipelines built or expanded for the Bakken already. This would help as well.
Keystone is the Key to Montana Oil
http://www.bigskybusiness.com/index.php?option=com_content&view=article&id=1831:keystone-is-the-key-to-montana-oil&catid=29:montanabusiness&Itemid=114
The future of Bakken Oil in Montana and North Dakota hangs in the balance of a national debate regarding the permitting of a huge pipeline by a huge Canadian company.
While each year the potential of the Bakken gets ratcheted upwards, its production of some of the lightest, sweetest crude ever known, is being curtailed by the lack of transportation to market. Relief is promised with the construction of a $7 billion, 1,690-mile pipeline by TransCanada – the Keystone XL — but it’s not at all certain that the pipeline will get the permitting it needs from the Obama Administration.
There is enough backup in the pipeline capacity that shipping by rail has become more economic in the Bakken field area.
ND oil companies ship by rail to get better price
http://www.businessweek.com/ap/financialnews/D9LUG0RG0.htm
Trains have quickly become a huge part in hauling crude from North Dakota’s oil patch with producers shipping barrels to more profitable markets not served by pipelines.
Motivated by the possibility of making more than $20 a barrel, North Dakota producers increasingly are sending crude on rail, including to a Louisiana terminal some 1,800 miles away.
“The new paradigm is rail,” said Harold Hamm, chief executive of Enid, Okla.-based Continental Resources Inc., one of the oldest and biggest players in the rich Bakken shale and Three Forks formations in western North Dakota.
North Dakota crude typically sells for $10 less per barrel at Cushing, Okla., where benchmark prices are set for West Texas Intermediate crude on the New York Mercantile Exchange.
Cushing, which typically stores about 10 percent of the nation’s oil, has had a glut of inventory in recent months, partly due to increased production from North Dakota and Canada.
Some North Dakota producers are now bypassing Cushing, in search of better prices in Louisiana, where the gap between prices for Light Louisiana Sweet and West Texas Intermediate crude has risen to historic levels. North Dakota sweet crude compares in quality to Light Louisiana Sweet and fetches like prices.
For a few dollars more per barrel to move crude by rail to St. James, La., the payoff more than pencils out, said Hamm, a billionaire oilman who is sending the bulk of his Bakken and Three Forks production to the Gulf Coast.
It doesn’t matter what they do or say or how they posture, they are powerless against a lawless president.
He uses the law or lack of law or ignoring the law as does the tyrant Hugo Chavez or Papa Doc or Idi Amin.
Given our 10% unemployment, the construction of this pipeline would also mean thousands of new US jobs. However, Obama wants us to have $6 gasoline just like in Europe.
Idi Amin
“I’ll have the liver and onions, please.”
I wonder, whey couldn’t they begin the pipeline in Montana and work south? This would service the Bakken while they await the State Department approval for Canada. I suppose that nothing will happen until after next year’s elections, and time’s awasting.
Think of the mountains and where the refineries are mostly located.
To answer your question, the activity is east of the Rockies. So like I said, why not begin in Montana right now? That would obviate the need for a State Department review. Also, if the Niobrara shale comes on board from shale finds east of the rockies, how will that resource go to market except by more expensive rail?
Maybe I don't understand what you are asking. Begining building a pipeline they don't have permission to connect across state line?
Maybe I don't understand what you are asking. Begining building a pipeline they don't have permission to connect across state line?
I am suggesting we get the damned State Department out of the mix. That I figure can be done if the pipeline is initiated in Montana. Begin now, and the hook up with Canada come on line in two years with a change of government.
That is going the wrong direction. Canada is struggling to get enough pipeline to move their product to market as well.
The only value in constructing a line is to the Southeast.
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