XL Keystone Pipeline’s Construction in Serious Doubt

The Trans-Canada-Keystone XL oil pipeline’s eventual construction may never see the light of day, according to reliable U.S. officials who revealed this opinion under the guise of anonymity. This route to a massive increase of Canadian crude oil converted from tar sands in the Athabasca region of Canada’s Alberta Province direct to U.S. refineries in Southern Louisiana and the Houston area could currently provide available refinery capacity with approximately 830,000 daily barrels.

Currently, most of the crude oil made available from Canada winds up in an inventory glut in Cushing, Oklahoma, which limits these imports, due to increased production generating within the U.S., primarily from the rapid evolution of hydraulic fracturing (fracking).  After being proposed more than a year ago, and tentatively approved by the Hillary Clinton-headed State Department, whose approval was needed due to the cross-border aspects of this decision, the pipeline project was held up indefinitely. This was due to the fact that it quickly became a political point of contention, fiercely opposed by “climatologists,” and strongly advocated by economically-minded conservatives. The latter saw this opportunity of up to an additional million barrels a day to reach U.S. refineries directly for swift conversion to gasoline, and other derivatives such as heating oil, jet fuel, diesel, and such by-products as chemicals and plastics.

Advocates strongly argued that such availability to U.S. markets, and even exports from Texas ports to Mexico and Latin America, would keep domestic prices down, while generating employment for thousands of construction workers and billions of additional revenues for the U.S. Treasury. Opponents reacted emphatically that such growing dependence on Canadian tar sands converted oil would leave a large “carbon footprint,” even if this production effluence would be primarily contained in Canada.

Canada’s Prime Minister Steven Harper reacted quickly at the time by flying to China and contracting with Beijing for substantial shipments of converted crude to be transported once an expanded pipeline from Alberta to British Columbia was completed and substantially improved port capabilities in Vancouver could be operational.

At the same time, the Obama Administration supposedly kept the door open by requesting a revised proposal to address the initial agreement’s shortcomings. Although the new plan satisfied the grievances of the Governor of Nebraska, whose state would be traversed, new objections regarding elements of the agreements were presented. This included objections posed by the Environmental Protection Agency, Army Corp of Engineers, and even legal challenges voiced by the Natural Resources Defense Council, who wasted no time registering its objection.

Despite the optimistic scenario of eventual “energy independence,” lower gasoline prices, and positive impact on the U.S. debt and deficit, the upcoming combination of objections from the aforementioned special interest groups have made the eventual approval of the Trans-Canada XL oil pipeline a sure bet to never get off the ground because of two major factors:

1) “Climatological purity” has become a major agenda item in President Barack Obama’s second term platform. Also, this emotionally driven issue has hundreds of thousands of vigorous supporters, who will take to the streets to voice their opposition to what they consider a symbol of climatic degeneration (the pipeline). Also the Natural Resources Defense Council stands ready to put legal roadblocks in the way that could take years to untangle.

2) Canada’s Prime Minister Harper read the tea leaves of this highly politicized event from the very beginning, and is prepared to shift all of Canada’s oil production (oil sands (converted and otherwise) to Southeast Asia when the West-Canadian pipeline infrastructure is ready. An immediate pipeline approval by the Obama Administration could have inhibited this decision.

It’s no exaggeration to claim that the “Canadian Oil Pipeline” issue was a symbolic referendum, decided by the November 6 Presidential election. Although not debated as such during events leading up to President Obama’s victory, the doom of the pipeline may also spell the failure of the fossil-fuel driven energy sector to reach its most optimistic potential.  The dreams of renewable energy seem to be triumphant over the realities of America’s coal, oil, and natural gas, wasting the opportunities provided by this nation’s world-leading natural resources.

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