The misinformation is rampant. Get informed.
The two biggest lies perpetuated by the fossil oil industry (“Big Oil”) and their corporatist minions in decision-making roles in our government are that TransCanada’s Keystone XL Pipeline will bring thousands and thousands of jobs to the U.S. and, perhaps more importantly, will increase our national security by making us less reliant on oil imported from the Middle East and other foreign countries that aren’t allies like Canada.
Both are complete and utter lies and there is solid proof to dispel both.
Let’s take the first Big Lie: that the Keystone XL will create a job bonanza in the U.S. When TransCanada began pitching this boondoggle and environmental-disaster-waiting-to-happen, the Big Oil trade group the America Oil Institute (it’s an “institute” — that’s kinda like a university!) claimed that it would create — not kidding here — “21,000 jobs today to 465,000 jobs by 2035”. Day-um. Sign me up! Nearly a half million jobs?! Let the crude flow, boys!
Turns out TransCanada’s own projections were a bit more modest. They believe the pipeline will employ only 9,000 during the two years it will take to build it.
The federal government’s assessment makes that number look good, though. As the Susan Casey-Lefkowitz reports at the National Resources Defense Council, the actual numbers are several orders of magnitude lower than the API’s ridiculously inflated claims:
The State Department draft environmental review of the Keystone XL tar sands pipeline shows how TransCanada, the American Petroleum Institute and other proponents of the pipeline have been vastly overstating the number of jobs that will be created by this dirty energy project. This creates unfair expectations among workers who need jobs, not empty promises from the oil industry. The State Department, based on TransCanada’s own numbers, shows that at the most 3,900 construction jobs will be created in building the pipeline with only 10 percent of the total workforce hired locally. Only 35 permanent jobs will be created by the pipeline. What is more, the State Department dismisses the evidence that Keystone XL is actually bad for the economy and many workers.
35. 465,000. What are 464,965 jobs among friends, right? They only missed it by 1,189,744%
But, that’s okay, because it’s going to make us so much more energy independent. Think of it. All of that oil flowing right into the veins of the American economy like a mainlining junkie getting his fix. TransCanada’s president of Energy and Oil Pipelines, Alex Pourbaix, said this (pdf) in testimony before the House Energy and Commerce Subcommittee on Energy and Power in December 2011:
Keystone will bring many benefits to the United States, but I believe the most important role Keystone will play is to help bring more energy security to the United States during a very volatile period recently. I think when you boil down the debate on this project, it comes down to a very simple question for Americans: Do they want secure, stable oil from a friendly neighboring Canada, or do they want to continue importing even more high-priced foreign oil from volatile regions such as Venezuela or the Middle East?
Keystone XL will help secure that stable supply of oil by linking Canadian and U.S. crude supplies with the largest refining markets in the United States. Canada’s oil reserves are vast; approximately 175 billion barrels are estimated to be recoverable. This compares to the U.S. reserves, which are estimated to be around 20 billion barrels.
The need for prompt approval of the Keystone XL project is particularly crucial today when U.S. consumers are struggling to cope with the high cost of gasoline, something that impacts the pocketbooks of everyone. Specifically, the Keystone XL project has the capability to replace nearly half the volume of higher priced Middle East oil presently consumed by the United States. A recent Department of Energy study found that the delivery of western Canadian crude oil to U.S. Gulf Coast refineries by Keystone would fill a gap being created by declining supply from traditional heavy crude suppliers such as Mexico and Venezuela. This supply further projected that if Keystone XL was not built, more oil would be shipped by foreign countries to the U.S. primarily from the Middle East to fill that gap.
Turns out that this is Big Fat Lie #2. See, much of the oil that is going to be flowing through the Keystone XL pipeline is already flowing into the United States through existing spigots, mostly into the Midwest. The impact of redirecting it to the Keystone XL is that is that it will likely RAISE gas prices in the Midwest because there is currently a surplus in this region:
Rather than providing the US with more Canadian oil, Keystone XL will simply shift oil from the Midwest to the Gulf Coast, where much of it can be exported to international buyers – decreasing US energy supply and increasing the cost of oil in the American Midwest,” concludes a new study by the Natural Resources Defense Council, a New York-based environmental advocacy non-profit group, citing numerous TransCanada studies and the transcripts of Canadian federal hearings.
But that isn’t even the half of it. The ugly, unspoken truth of the matter is that the Keystone XL pipeline is nothing more than a tax-free conduit through the United States to let Canadian oil producers get their crude oil to the export market in the Gulf of Mexico less expensively and without having to bear the environmental risks in their own country. In other words that oil isn’t for US, it’s for the global market. It will be refined in Port Arthur and shipped elsewhere at great (tax-free) profit.
Here’s an exchange between Congressman Ed Markey during the House hearing in 2011 where Alex Pourbaix testified. Rep. Markey tried in vain to get Mr. Pourbaix to put restrictions on any company using their pipeline, requiring that all of the oil will be kept in America to replace overseas oil. Not surprisingly, Pourbaix refused.
Here’s the transcript. It’s long but it’s worth paying close attention to:
REP. ED MARKEY: In fact, nearly all of the refineries where the Keystone crude will be sent are located in Port Arthur, Texas, which is a designated foreign trade zone. This means that if these refineries re-exported diesel or other refined products, they wouldn’t even have to pay U.S. taxes on those exports. So, Mr. Pourbaix would TransCanada support legislation that ensures that the product can only move forward if the diesel or other refined fuels from the pipeline are ONLY sold in the United States so that this country realizes ALL of the energy security benefits your company and others have promised to bring to back out that oil from Venezuela or from the Middle East for the United States of America? Would you commit to not having that oil sold outside of the United States?
TRANSCANADA PRESIDENT FOR ENERGY AND OIL PIPLELINES ALEX POURBAIX: As I said earlier, TransCanada does not produce one barrel of oil. Our entire business is safely transporting that oil. That would be a question that would be better put to our shippers who are largely refiners and producers and these are largely American companies.
MARKEY: Would you agree to put a prohibition on re-export into your contracts with these refineries to ensure that re-export does not occur? Do you have the power to do that? And then to make that a legal part of the agreement and that will make all of us feel a lot better. Would you be willing to commit to making that a condition of being able to use the pipeline?
POURBAIX: If the concern we’re talking about is energy security, for the U.S., if the U.S. government were to put that kind of criteria on the approval of the pipeline, what I would argue is that that would reduce the energy security benefits for the U.S. because, as I said, the U.S. is, by far, the largest consumer of refined products…
MARKEY: I don’t understand why that reduces our security. What you’re saying is that you’re contractually willing to keeping that oil here. So, it’s only a redundancy. Will you commit to the redundancy to having to put on paper as a condition? Because you’re saying it’s going to be happening anyway. That’s what you’re saying. What’s your problem with then agreeing that that’s the way it’s going to be? Will you commit to agree to put on paper what you say is going to happen in terms of oil here?
POURBAIX: As I said before, in order to get enough refined products that are needed for the U.S., the refineries produce, from time to time, more diesel than they use and they tend to export that diesel to Europe and they import incremental volumes of refined products…
MARKEY: Would you agree that there’d be no net difference, that the total amount of oil that is transported through the pipeline then has to have an exact corresponding amount that is imported in any other form in order to ensure that the amount stays exactly the same so that our energy security in the United States, backing out this oil from the Middle East, does in fact achieve this goal? Would you commit to that?
POURBAIX: Once again, in many ways, I can’t do that because I am merely the shipper of this oil.
MARKEY: No, I want you to make it a condition of shipping, that that’s your deal with these people. Can you do that?
POURBAIX: No, I can’t do that. We’ve already agreed to our shipping arrangements with our customers.
MARKEY: Well, you can see why I’m very skeptical and the American people are very skeptical that this is just going to be a conduit to Port Arthur, tax-free, to send this stuff around the planet. And you just say, “Oh, market conditions changed and nothing in the free market stops us from sending this overseas.” And, meanwhile, all these environmental concerns have been overridden. So, you can see why we’re a little bit skeptical. We just want a little guarantee that we DO get the national security benefits from it and a corporation isn’t allowed to, because they’re not legally bound, to then skirt that commitment. So, I have very serious reservations about this company and its commit to our, its REAL commitment to meeting the national security objectives of our country.
In his testimony during that same hearing, Daniel Weiss of the Center for American Progress, explained that, even if the oil did stay in the U.S., it wouldn’t matter much. The fact is, oil is a global commodity and the price is set by the global market.
The Associated Press tested whether more U.S. drilling would lower gasoline prices when it conducted an exhaustive analysis of 36 years of monthly U.S. oil production and gasoline price data. AP found “No statistical correlation between how much oil comes out of U.S. wells and the price at the pump.” The Wall Street Journal noted that residents of essentially oil free Germany paid about the same for gasoline as we did in recent years. (minus taxes, of course.)
Building the Keystone XL pipeline won’t increase our energy security much because a portion of the Canadian tar sands oil flowing to our Gulf Coast refineries will be exported as diesel or gasoline to Europe or South America. But, the pipeline will foster an increase in energy intensive tar sands oil production in Canada. This will add even more carbon pollution to our overburdened atmosphere, further exacerbating climate change and its harmful and costly consequences.
The fossil fuel industry is flush with money, making record profits at a time when fuel costs are at record highs. They even get subsidies from the U.S. government. They are spending a goodly chunk of that money on creating a misinformation, propaganda campaign that has many American believing things that are not only not true, but that actually hide the damage that approving the Keystone XL pipeline will do to our economy. They are aided and abetted by lawmakers who receive giant paychecks for being doing their bidding when passing laws and setting policies. Lawmakers like Congressman Paul Ryan, for example, who included the Keystone XL pipeline in his Wall Street Journal op-ed today releasing his
new rehashed budget fiasco.
One final thing: Keep in mind that none of this addresses the safety issues involved with the Keystone XL and what will happen if there is an accident — an environmental catastrophe of epic proportions right over an aquifer that supplies a huge swath of our country’s drinking water. The fact is that these two lies are so egregious and so deceptive that we don’t even need to have that discussion.
To say that the environmental risk, one Canada itself isn’t even willing to take, is worth the payoff is a big enough lie that the entire project should be off the table and into the rubbish bin of history.
[CC photo credit: rickz | Flickr]