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Mounting evidence that tar sands activity is causing health problems | Danielle Droitsch’s Blog | Switchboard, from NRDC

Mounting evidence that tar sands activity is causing health problems | Danielle Droitsch’s Blog | Switchboard, from NRDC.

Danielle Droitsch’s Blog

Mounting evidence that tar sands activity is causing health problems

Danielle DroitschPosted February 26, 2014

U.S. Senator Barbara Boxer from California has connected the dots and is pointing to growing evidence that communities living near tar sands mining and drilling operations, pipelines, and refineries are showing serious health risks and problems.  An issue brief published by NRDCTar Sands Crude Oil:  Health Effects of a Dirty and Destructive Fuel, profiles some of the latest evidence including scientific research that tar sands activity is causing increasing levels of air and water pollution that are then linked to health problems including cancer.  Tar sands development affects communities across North America and includes a network of mining, drilling, and upgrading operations, pipelines and refineries.  This network spans from northern Canada to refineries in California, the Gulf Coast, and the Midwest.  The science is mounting but state, provincial, and federal governments have done too little to protect public health.  This scientific evidence was not considered by the State Department’s environmental review of the Keystone XL pipeline.   This mounting evidence shows there are considerable risks with expanding the tar sands industry.

NRDC’s new issue brief reviews the latest scientific literature on this important issue.

Air pollution from tar sands operations in Alberta

Studies by the National Academy of Sciences have noted that expanding tar sands activities have  increased air pollution near Fort McMurray (the epicenter of tar sands development) and just outside Edmonton, Alberta.  The most recent 2014 study looked at polycyclic aromatic hydrocarbons (PAHs) which are chemicals known to damage DNA, are carcinogens, or cause developmental impacts.  This study found that environmental impact studies drafted by the tar sands industry have systemically underestimated levels of this pollution.  A 2013 study noted elevated level of hazardous air pollutants coming from upgrading facilities north of Edmonton noting elevated rates of leukemia and other cancers in areas surrounding these operations north of Edmonton.

Water pollution from tar sands operations

Researchers have confirmed the presence of elevated levels of toxic polycyclic aromatic hydrocarbons which can be traced directly to expansion of tar sands production.  Some waters in Alberta exceed Canadian standards for chemicals linked to cancer, genetic damage, birth defects, and organ damage.  Scientists have also found that tar sands development is leading to increasing amount of methylmecurcry in Alberta’s waterways including an exponential increase within 30 miles of tar sands upgraders.  Methylmercury is a potential neurotoxin causing development and behavioral problems.

Tailings ponds which now cover an area the sized of Washington DC contain multiple toxic chemicals including arsenic, benzene, lead, mercury, naphthenic acid, and ammonia.  As much as 2.9 million gallons of toxic tailings leak into the environment every day.  A 2014 study showed that extreme concentrations of PAHs present in tailings may be evaporating into the air and then deposited into water.  New federal research by Environment Canada released in February 2014 confirms that leaking tailings ponds are leaching into groundwater and then into the Athabasca River.

Rising cancer rates in First Nations communities

Scientists have confirmed increased incidences of cancer in Fort Chipewyan, Alberta.  There, scientists have noted an increased cancer rate from 1995 to 2009 – 30 percent higher than would be typically expected.  Dr. John O’Conner, an Alberta physician, has for years called for further investigation of cancer incidences.  To date, there has not been an independent study of these cancers despite repeated called by First Nations. Dr. O’Conner was invited by Senator Boxer to speak in Washington to share his observations.]

Tar sands pipeline spills

Large quantities of tar sands were spilled from leaking pipelines into two communities in Marshall, Michigan  in 2010 and Mayflower Arkansas in 2013.  After the spill in Michigan, 320 people suffered adverse health effects including cardiovascular, dermal, gastrointestinal, neurologic, ocular, renal and respiratory impacts according to the Michigan Department of Public Health.  In Arkansas, air monitoring showed significantly increased levels of benzene.  Raw tar sands is mixed with diluting agents to move the substance through pipelines.  The specific content of diluting agents are unknown as they are proprietary but most formulations include natural gas liquid condensate containing volatile hydrocarbons such as benzene, toluene, ethyl benzene and xylene. So far, the federal government in both Canada and the U.S. has failed to study or adopt regulations to deal with the chemical export of the unique tar sands mixture flowing through pipelines and has not commissioned any studies regarding the long-term human impacts of spills.

Tar sands refinery emissions

Chemicals in tar sands may be released as air pollutants during the refining process.  Diluted tar sands contain 102 times more copper, 11 times more nickel and 5 time more lead than conventional crude oil. Diluted bitumen from tar sands has notably higher levels of certain sulfur compounds called mercaptans that are highly volatile and linked to central nervous system problems. Diluted bitumen also contains higher levels of naphthenic acids which can significantly increase the corrosive properties of crude oil at high temperatures during the refining process.  Low quality crudes like tar sands have been identified as a contributing factor in a major  refinery accidents like the one at the Chevron refinery in Richmond, California which sent 15,000 residents to area hospitals and endangered the lives of 19 workers.

Petroleum Coke impacts – a byproduct from tar sands refining

The refining of tar sands creates a by-product called petroleum coke which contains relatively high concentrations of metals including mercury, lead, arsenic, chromium, selenium, and nickel which people are exposed to when they breathe dust blown from piles of petroleum coke.  This metal-laden dust can contaminate nearby homes and yards where it can accumulate.  The dust is composed of particulate matter, which is recognized by the U.S. EPA to contribute to a number of negative health effects.  Many of the metals in petroleum coke piles are carcinogens and linked to other health problems.

Health Concerns Deserve More Attention

Federal, state, provincial, agencies should evaluate all of the potential impacts of tar sand crude.  In Canada, governments should conduct independent investigations into the health impacts on locally affected communities particularly Fort McMurray, Fort Chipewyan, and Edmonton, Alberta.  New proposals for tar sands operations and infrastructure including pipelines and refineries must consider human health impacts especially as the tar sands industry seeks to triple production.   The Final Environmental Impact Statement for the Keystone XL tar sands pipeline did not adequately consider these issues.  Until there is a better understanding of how these projects will cumulatively impact human health, efforts to expand the tar sand industry should stop.  This means rejecting the proposed Keystone XL tar sands pipeline.

Go to StopTar.org to ask President Obama to reject the pipeline.

Mounting evidence that tar sands activity is causing health problems | Danielle Droitsch's Blog | Switchboard, from NRDC

Mounting evidence that tar sands activity is causing health problems | Danielle Droitsch’s Blog | Switchboard, from NRDC.

Danielle Droitsch’s Blog

Mounting evidence that tar sands activity is causing health problems

Danielle DroitschPosted February 26, 2014

U.S. Senator Barbara Boxer from California has connected the dots and is pointing to growing evidence that communities living near tar sands mining and drilling operations, pipelines, and refineries are showing serious health risks and problems.  An issue brief published by NRDCTar Sands Crude Oil:  Health Effects of a Dirty and Destructive Fuel, profiles some of the latest evidence including scientific research that tar sands activity is causing increasing levels of air and water pollution that are then linked to health problems including cancer.  Tar sands development affects communities across North America and includes a network of mining, drilling, and upgrading operations, pipelines and refineries.  This network spans from northern Canada to refineries in California, the Gulf Coast, and the Midwest.  The science is mounting but state, provincial, and federal governments have done too little to protect public health.  This scientific evidence was not considered by the State Department’s environmental review of the Keystone XL pipeline.   This mounting evidence shows there are considerable risks with expanding the tar sands industry.

NRDC’s new issue brief reviews the latest scientific literature on this important issue.

Air pollution from tar sands operations in Alberta

Studies by the National Academy of Sciences have noted that expanding tar sands activities have  increased air pollution near Fort McMurray (the epicenter of tar sands development) and just outside Edmonton, Alberta.  The most recent 2014 study looked at polycyclic aromatic hydrocarbons (PAHs) which are chemicals known to damage DNA, are carcinogens, or cause developmental impacts.  This study found that environmental impact studies drafted by the tar sands industry have systemically underestimated levels of this pollution.  A 2013 study noted elevated level of hazardous air pollutants coming from upgrading facilities north of Edmonton noting elevated rates of leukemia and other cancers in areas surrounding these operations north of Edmonton.

Water pollution from tar sands operations

Researchers have confirmed the presence of elevated levels of toxic polycyclic aromatic hydrocarbons which can be traced directly to expansion of tar sands production.  Some waters in Alberta exceed Canadian standards for chemicals linked to cancer, genetic damage, birth defects, and organ damage.  Scientists have also found that tar sands development is leading to increasing amount of methylmecurcry in Alberta’s waterways including an exponential increase within 30 miles of tar sands upgraders.  Methylmercury is a potential neurotoxin causing development and behavioral problems.

Tailings ponds which now cover an area the sized of Washington DC contain multiple toxic chemicals including arsenic, benzene, lead, mercury, naphthenic acid, and ammonia.  As much as 2.9 million gallons of toxic tailings leak into the environment every day.  A 2014 study showed that extreme concentrations of PAHs present in tailings may be evaporating into the air and then deposited into water.  New federal research by Environment Canada released in February 2014 confirms that leaking tailings ponds are leaching into groundwater and then into the Athabasca River.

Rising cancer rates in First Nations communities

Scientists have confirmed increased incidences of cancer in Fort Chipewyan, Alberta.  There, scientists have noted an increased cancer rate from 1995 to 2009 – 30 percent higher than would be typically expected.  Dr. John O’Conner, an Alberta physician, has for years called for further investigation of cancer incidences.  To date, there has not been an independent study of these cancers despite repeated called by First Nations. Dr. O’Conner was invited by Senator Boxer to speak in Washington to share his observations.]

Tar sands pipeline spills

Large quantities of tar sands were spilled from leaking pipelines into two communities in Marshall, Michigan  in 2010 and Mayflower Arkansas in 2013.  After the spill in Michigan, 320 people suffered adverse health effects including cardiovascular, dermal, gastrointestinal, neurologic, ocular, renal and respiratory impacts according to the Michigan Department of Public Health.  In Arkansas, air monitoring showed significantly increased levels of benzene.  Raw tar sands is mixed with diluting agents to move the substance through pipelines.  The specific content of diluting agents are unknown as they are proprietary but most formulations include natural gas liquid condensate containing volatile hydrocarbons such as benzene, toluene, ethyl benzene and xylene. So far, the federal government in both Canada and the U.S. has failed to study or adopt regulations to deal with the chemical export of the unique tar sands mixture flowing through pipelines and has not commissioned any studies regarding the long-term human impacts of spills.

Tar sands refinery emissions

Chemicals in tar sands may be released as air pollutants during the refining process.  Diluted tar sands contain 102 times more copper, 11 times more nickel and 5 time more lead than conventional crude oil. Diluted bitumen from tar sands has notably higher levels of certain sulfur compounds called mercaptans that are highly volatile and linked to central nervous system problems. Diluted bitumen also contains higher levels of naphthenic acids which can significantly increase the corrosive properties of crude oil at high temperatures during the refining process.  Low quality crudes like tar sands have been identified as a contributing factor in a major  refinery accidents like the one at the Chevron refinery in Richmond, California which sent 15,000 residents to area hospitals and endangered the lives of 19 workers.

Petroleum Coke impacts – a byproduct from tar sands refining

The refining of tar sands creates a by-product called petroleum coke which contains relatively high concentrations of metals including mercury, lead, arsenic, chromium, selenium, and nickel which people are exposed to when they breathe dust blown from piles of petroleum coke.  This metal-laden dust can contaminate nearby homes and yards where it can accumulate.  The dust is composed of particulate matter, which is recognized by the U.S. EPA to contribute to a number of negative health effects.  Many of the metals in petroleum coke piles are carcinogens and linked to other health problems.

Health Concerns Deserve More Attention

Federal, state, provincial, agencies should evaluate all of the potential impacts of tar sand crude.  In Canada, governments should conduct independent investigations into the health impacts on locally affected communities particularly Fort McMurray, Fort Chipewyan, and Edmonton, Alberta.  New proposals for tar sands operations and infrastructure including pipelines and refineries must consider human health impacts especially as the tar sands industry seeks to triple production.   The Final Environmental Impact Statement for the Keystone XL tar sands pipeline did not adequately consider these issues.  Until there is a better understanding of how these projects will cumulatively impact human health, efforts to expand the tar sand industry should stop.  This means rejecting the proposed Keystone XL tar sands pipeline.

Go to StopTar.org to ask President Obama to reject the pipeline.

Harper‘s Support for Democracy Falls Short at Home | DeSmog Canada

Harper‘s Support for Democracy Falls Short at Home | DeSmog Canada.

Wed, 2014-02-26 09:55RUSSELL BLINCH

Russell Blinch's picture

Harper‘s Support for Democracy Falls Short at Home

obama harper north american leaders summit

Do democracy and freedom begin at home for Prime Minister Stephen Harper?

Recently the Prime Minister told Ukraine President Viktor Yanukovych he will be judged on his actions, not words, as violence against the country’s pro-democracy protesters steadily escalates. Harper signed a joint statement at the North American leaders summit in Toluca, Mexico, saying “[the leaders] agreed they will continue to monitor the situation closely to ensure that actions mirror words.”

The Prime Minister also called for an emergency debate in Parliament this week, saying “we understand that this violence is occurring because the majority of the population is very worried about the steps taken by their government that very much remind them of their anti-democratic and Soviet past.”

While Canadians will no doubt be relieved to see the country and its leadership take a meaningful stance against the oppression and violence of President Yanukovych’s regime, there’s sure to be some cognitive dissonance associated with Harper as a ‘democracy-for-the-people’ spokesperson here at home.

In fact, Harper has been throwing his political weight around a lot lately. Including during a trip to Israel.

In January Harper addressed the Knesset in Jerusalem during a high profile trip where he lavished praise on Israel as a bastion of democracy in a troubled region. (You can see the fully edited and polished Harper-esque version on the Prime Minister’s new newsfeed 24/7).

During his address Harper scattered the words “democracy” or “democratic” more than 10 times in the relatively short speech. The word “freedom” was also liberally applied as he lauded Israel’s leadership.

Interestingly, Harper threw in a little aside about political dissent when he said, “no state is beyond legitimate questioning or criticism. Indeed, Israel as a democratic state makes such criticism a part of your national life.”

It’s refreshing to see a Canadian leader sticking up for democratic values abroad and one can argue more leaders should do it. But wouldn’t it be nice if Harper also supported some of those high-minded values at home?

At least it would be good to know how Harper defines “legitimate questioning or criticism” here at home when it comes to, say, energy development or pipeline infrastructure in Canada. Are criticisms still legitimate if they come from environmentalists or First Nations groups?

Because when you look back over the past several years you can see all calls for democracy are equal when it comes to the Harper government; just some calls are more equal than others.

Harper has his own unique style of suppressing democratic dissent in this country, a particular flare for beefing up the executive and legislative branches of power in order to hold ‘democracy’ in check. All things in moderation, after all.

Take the scaled-up attack on charities as an example.

Federal tax authorities are aggressively auditing some of the government’s most articulate and pointed critics, including the David Suzuki Foundation, Environmental Defence, the Pembina Foundation, and the Ecology Action Centre.

We now know that Ottawa is giving the Canada Revenue Agency a cool $13.4 million to investigate charitable organizations, a probe that will now extend beyond 2017, according to documents obtained by DeSmog Canada through Access to Information legislation. The investigation spending in an otherwise parsimonious budget is a sharp boost from the $8 million publically announced in the 2012 budget.

But it could pay off. Ottawa seems to have a new victim.

Environmental Defence, which has been “working since 1984 to protect Canadians’ environment and human health,” is on the verge of losing its charitable status under the taxman’s probe. Another organization, Physicians for Global Survival, was the first organization to loose its charitable status – the one group out of over 900 investigated.

“They have told us that, yes, more or less that they consider that things that we’ve been doing for 30 years are things that they now feel are not charitable,” Tim Gray, the executive director of Environmental Defence, said in a Toronto Sun report.

This haranguing against green groups has deep roots. Harper and his ministers have long worked to link environmental organizations to terrorism or to mischaracterize groups asfronts for well-funded American interests that threaten Canadian domestic energy supplies.

“I think we’ll see significant American interests trying to line up against the Northern Gateway project, precisely because it’s not in the interests of the United States. It’s in the interests of Canada,” Harper said in 2012, as recounted in the book, The Longer I’m Prime Minister.

“They’ll funnel money through environmental groups and others in order to slow it down,” he said.

The sentiment is strange when you consider the oilsands are important for American oil interests, as is evidenced in the drawn out battle for the Keystone XL pipeline, destined tosupply U.S. refineries with Albertan oil. The resentment of foreign interests also seems misplaced when you consider growing Chinese ownership in the oilsands and significant Chinese state investment in the Northern Gateway pipeline.

One this is certain: it was after these anti-environmental group statements that the Harper government directed the Canada Revenue Agency to target the legitimate dissent of some of Canada’s most prominent and respected environmental charities.

Columnist Mitchell Anderson, writing in the Tyee, opened a recent column with a pointed question: “Is Canada getting creepy?”

Mitchell outlined the CSIS affair, including Chuck Strahl’s resignation as chair of the Security Intelligence Review Committee, watchdog for the country’s powerful spying apparatus. Strahl resigned after his role as a lobbyist for the Northern Gateway pipeline project came to light. As Mitchell wrote, this was “an obvious conflict given that CSIS was spying on anti-pipeline activists – in partnership with the RCMP and private oil companies.”

At the same time as the crackdown on the environmental NGO sector, the Harper government has also vanished some of Canada’s most crucial environmental laws, expedited approvals for major energy projects and defanged the National Energy Board, which now hasstrict limits on how the public can participate in the project review process.

Critics have accused the Harper government of engaging in undemocratic politics. This lengthy list, compiled by Lawrence Martin, outlines all the times this government was found to behave in anti-democratic ways (contempt of Parliament, prorogation of Parliament, weakened watchdogs, abuse of process, suppression of research, document tampering and more) at a time when 62 per cent of Canadians felt the country was in a state of crisis.

That was in 2011, before the Harper government won its majority. By all accounts things have only gotten worse.

So while we’re working hard to protect civil dissent and promote democracy worldwide, let’s not forget to fight for the same at home.

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RIGZONE – Report: US Energy Secretary Favors Reducing Oil Shipped By Rail

RIGZONE – Report: US Energy Secretary Favors Reducing Oil Shipped By Rail.

 

by  Reuters
|

Wednesday, February 19, 2014

Reuters

NEW YORK, Feb 19 (Reuters) – U.S. Energy Secretary Ernest Moniz supports reducing the amount of crude oil shipped by rail in favor of pipelines that are safer, cheaper and cleaner, Capital New York reported on Wednesday.

“What we probably need is more of a pipeline infrastructure and to diminish the need for rail transport over time,” he said in an interview published on the Capital New York website.

He said the infrastructure is “not there” to handle the surge in North Dakota Bakken oil production from near zero to 1 million barrels per day (bpd).

“Frankly, I think pipeline transport overall probably has overall a better record in terms of cost, in terms of emissions and in terms of safety.”

A Department of Energy spokesman was not immediately available to provide more detail on Moniz’s comments.

His comments are among the first by a senior Obama Administration official to signal an apparent preference for shipping oil from places like the Bakken shale by means other than rail lines, in the wake of a series of explosive derailments that have alarmed the public.

While pipelines are generally a much cheaper form of transport, shipping crude in mile-long trains has become a popular alternative since new terminals can be built more quickly than pipelines to serve booming remote shale patches, and offer greater flexibility for refiners.

Moniz has bemoaned the lagging pace of infrastructure development before, but has not been so blunt in backing pipelines over rail shipments.

President Barack Obama has been considering whether to greenlight construction of the Keystone XL pipeline from Canada, without which there could be a significant increase in crude moved by rail, according to a State Department report.

U.S. regulators are considering imposing tougher standards on older models of oil tank cars. Moniz said the U.S. Department of Transportation could issue new regulations this year.

“There’s been a handful of train accidents and that’s been quite troubling,” he said. “We have been transporting oil products by train with a decent safety record over time and there’s a lot of it.”

(Reporting by Jonathan Leff; Editing by David Gregorio)

Proposed Energy East Pipeline Could Exceed Keystone XL in GHG Emissions, Finds Report | DeSmog Canada

Proposed Energy East Pipeline Could Exceed Keystone XL in GHG Emissions, Finds Report | DeSmog Canada.

Fri, 2014-02-07 10:08INDRA DAS

Indra Das's picture

Proposed Energy East Pipeline Could Exceed Keystone XL in GHG Emissions, Finds Report

Climate Implications of the Proposed Energy East Pipeline: A Preliminary Assessment

A new report from Pembina Institute says that the proposed TransCanada Energy East pipeline could generate up to 32 million tonnes (Mt) of additional greenhouse gas (GHG) emissions from the crude oil production required to fill it. Thirty-two million tonnes of carbon emissions is the equivalent of adding 7 million cars to Canada’s roads, exceeding the projected emissions of the Keystone XL pipeline proposal.

The Keystone XL pipeline, in comparison, would generate 22 Mt of additional GHG emissions through oilsands production, according to a previous report by Pembina. The estimated emissions impact of Energy East is “higher than the total current provincial emissions of five provinces.”

The $12 million Energy East pipeline, proposed by TransCanada in August 2013, would have the capacity to transport 1.1 million barrels per day (bpd) of oilsands and conventional crude oil from Alberta to New Brunswick. According to the report, the volume of new oilsands production associated with Energy East would represent up to a 39 per cent increase from 2012 oilsands production levels.

Figure 1: Greenhouse gas emissions associated with Energy East compared to those of selected
provinces. Climate Implications of the Proposed Energy East Pipeline: A Preliminary Assessment. The Pembina Institute, 2014.

Oilsands production is currently Canada’s fastest growing source of GHG emissions, and is set to nearly triple between now and 2030, according to Environment Canada. Report authors Clare Demerse and Erin Flanagan told DeSmog Canada that this growth is “the single largest barrier to achieving [Canada’s] 2020 climate target.”

Given that Canada is set to miss its 2020 emissions reduction target by 122 Mt with current measures, Demerse and Flanagan see the Energy East proposal’s potential to add a new source of GHGs from the oilsands as “significant and troubling.”

The authors stress that the report, titled Climate Implications of the Proposed Energy East Pipeline, only assesses the pipeline’s upstream, “Well-to-Refinery Gate” emissions impact, rather than the downstream, “Well-to-Wheel” emissions of the crude oil being transported, which would include emissions released by its combustion in vehicle engines. The actual climate impact of Energy East would therefore be even greater than figures in the report.

“The oilsands are already Canada’s fastest-growing source of carbon pollution and the Energy East pipeline would help to accelerate production. Any regulatory review should include not only the impact of the pipeline itself, but also the impact of producing the crude that would flow through it,” said Demerse, Federal Policy Director at Pembina.

Figure 2: Change in GHG emissions by economic sector, 2005-2020. Climate Implications of the Proposed Energy East Pipeline: A Preliminary Assessment. The Pembina Institute, 2014.

Demerse and Flanagan hope that the report will urge the National Energy Board (NEB) to undertake a more thorough appraisal of Energy East’s environmental impact than its review of Enbridge’s Northern Gateway proposal, saying that they wanted to submit their findings “before the National Energy Board decides on the format of its review.”

The authors note that “many Canadians asked for consideration of the impacts of oilsands production in the Northern Gateway hearings,” so if the NEB chooses a “more complete and balanced review of the Energy East proposal – one that looks at the environmental impacts of filling the pipeline as well as the pipeline infrastructure itself – I think the regulators would simply be catching up to where Canadians already are.”

TransCanada is set to submit its regulatory application for Energy East to the NEB later this year.

The report recommends that the NEB “include the pipeline’s full upstream impacts in the scope of its review, and that the federal government should end its delays and adopt strong emissions regulations for the oil and gas sector.”

The report mentions that carbon capture and storage (CCS) technologies have been found to lower oilsands production emissions, but adds that “Canada lacks the kind of stringent climate policies that would provide a strong incentive for those kinds of investments,” especially considering the high cost of such technology.

ICO2N, a group of energy companies invested in developing CCS technology, estimates that a carbon price of $125/tonne is necessary to justify capture of approximately 15 per cent of oilsands CO2.

The authors believe that approving projects like Energy East and Keystone XL could “see less emphasis on, and less encouragement of, clean energy investment in Canada” when the country needs to be “starting the transition to a clean energy future.”

“The oilsands industry plans to triple production by 2030 and building new pipelines is necessary to realize those ambitions. We need to look at the full scope of impacts when evaluating pipelines,” said Flanagan.

In its 2013 World Energy Outlook, the International Energy Association (IEA) modelled a scenario where countries take the action required to keep global warming below 2 degrees C, and found that global demand for oil would likely peak in 2020 and fall thereafter. Demerse and Flanagan suggest that Canada needs to “keep that kind of long-term picture in mind when we’re considering a pipeline proposal that could last for 30, 40 or 50 years.”

What the TransCanada Pipeline Will Really Cost Us | Carl Duivenvoorden

What the TransCanada Pipeline Will Really Cost Us | Carl Duivenvoorden.

Carl Duivenvoorden

Sustainability consultant

 What the TransCanada Pipeline Will Really Cost Us
Posted: 02/06/2014 5:30 pm

As the Energy East Pipeline dominates ever more headlines, editorials, ads and press conferences in my home province of New Brunswick and elsewhere, I’m reminded of an interview given by Calgary Mayor Naheed Nenshi on the CBC Radio’s The House in February 2013.

Mayor Nenshi said:

We’ve got a resource that is valuable to us and to our kids and to our grandkids, and we know that someday it’s not going to be that valuable; someday we’ll have a low carbon world. And I think it would be deeply irresponsible for us to leave that resource in the ground so that it will be worthless for future generations.

Ponder that statement and you get to the heart of the current lust for pipelines out of Alberta, whether south, west, north or east. You get to the heart of why the Energy East Pipeline, a project barely contemplated just a year ago, has quickly received nearly universal adulations and blessings, and seems on an ultrafast track to reality.

But before we place our chips on the pipeline, perhaps the costs and benefits are worth closer scrutiny.

Economic gains

Almost every assessment of the pipeline stresses the economic gains it will provide to New Brunswick. A recent report by Deloitte and Touche (commissioned, interestingly, by TransCanada, the company building the pipeline) suggests our province will earn about $700 million in tax revenues over 40 years. That sounds like a lot, but, in context, it’s roughly $20 million per year in a province with an annual budget of about $8,000 million, or about 0.25 per cent of our budget. Not exactly a windfall.

The same report suggests NB would see about 1550 direct jobs as a result of the pipeline. That sounds tempting too. But over 90 per cent would be temporary, lasting three years at most. In context, NB’s construction industry presently provides 27,000 jobs, or nearly 20 times as many.

Finally, because Alberta oil is landlocked and therefore traditionally sold below world prices, it’s been suggested that bringing it east will lower energy prices for us. As rosy as it might be to imagine that world oil prices will suddenly drop because Alberta crude has arrived in Atlantic Canada, it’s probably more realistic to expect that Alberta crude will get more expensive as soon as a pipeline links it to us, and the world market.

So — economic glitter perhaps, but not necessarily economic gold.

Environmental costs

It’s interesting, and perhaps telling, that the Deloitte and Touche study specifically excluded any assessment of the environmental aspects of the pipeline project. So has much of the official conversation. That’s like ignoring elephants in the room.

First, there’s the issue of pipeline integrity and the potential for spills. Pipelines have a long and mostly successful history, so it’s probably fair to assume that if they are well engineered, constructed, maintained and operated, the risk of ruptures is small. A spill is possible, but it’s probably the baby elephant in the room.

The jumbo elephant, quietly ignored in most of the conversation so far, is climate change. No matter what any of us may wish to believe, burning oil produces greenhouse gases, and greenhouse gases are warming our planet and disrupting our weather. The Energy East Pipeline, the Keystone XL Pipeline, the Northern Gateway Pipeline and the hinted Beaufort Sea option – all are big, new drinking straws stuck into that bituminous milkshake called the oil sands, serving it up to an addicted world that needs to break its addiction.

The International Energy Agency, a leading global authority, has stated that if we are to put the brakes on climate change, most of our known global fossil fuel reserves must remain untouched in the ground. Kudos to Mayor Nenshi for implicitly acknowledging that; but shame on those who interpret it as a signal to get as much oil to market as quickly as possible while it’s still worth something. Hence the pipeline bonanza in which we are being asked to partake.

Our choice

Jobs come and go but climate change is permanent. Years from now, our grandkids will look back on the decision we are facing today. I can’t imagine them being very sympathetic or understanding if we choose to trade away their long term climate stability for our short term prosperity. But that’s the very trade we’re contemplating as we consider the Energy East pipeline.

Energy East pipeline a potential CO2 traffic jam, report says – Politics – CBC News

Energy East pipeline a potential CO2 traffic jam, report says – Politics – CBC News.

TransCanada CEO Russ Girling announces the company is moving forward with the 1.1 million barrel-per-day Energy East Pipeline project, at a news conference in Calgary, Aug. 1, 2013. A new report from environmental think-tank Pembina Institute believes Energy East would add 30 to 32 million tonnes of CO2 a year into the atmosphere.TransCanada CEO Russ Girling announces the company is moving forward with the 1.1 million barrel-per-day Energy East Pipeline project, at a news conference in Calgary, Aug. 1, 2013. A new report from environmental think-tank Pembina Institute believes Energy East would add 30 to 32 million tonnes of CO2 a year into the atmosphere. (Jeff McIntosh/Canadian Press)

The greenhouse gas emissions from oil flowing through TransCanada Pipelines’ proposed Energy East project would be equivalent to putting seven million new cars a year on Canadian roads, according to a report from an environmental think-tank released today.

The Pembina Institute’s study looked at the potential upstream carbon pollution — that is, from the well to the refinery gate — from oil flowing through the pipeline and found that it could add anywhere from 30 to 32 million tonnes of CO2 a year to the atmosphere.

“For a single piece of infrastructure, that’s huge. It’s more than the emissions of five provinces,” explained Clare Demerse, Pembina’s federal policy director and co-author of the report.

“The single most effective climate policy today [in Canada] is Ontario’s decision to phase out coal [for generating electricity]. The emissions associated with building Energy East could effectively wipe out the gains of our single most effective climate policy by far,” she told CBC News.

Tune in to The National on CBC-TV tonight to hear how pipeline companies and environmentalists are changing their tactics in Canada’s energy infrastructure debate.

Energy East is planned to take both conventional and oilsands oil from Alberta to the deep-water port in Saint John. The project would convert an existing natural gas pipeline that runs to the Ontario-Quebec border to carry oil, then build a new pipeline the rest of the way. When running at full capacity, Energy East would eventually carry 1.1-million barrels of crude a day.

TransCanada has yet to file an application with the National Energy Board, but it is expected to do so in the middle of this year.

Demerse admits that this is a preliminary report and that it is hard to comment accurately on Energy East because so little detail is known about the project. Still, she said, Pembina wanted to start the conversation about it as soon as possible.

TransCanada said it wants to take a closer look at the numbers before it comments on the report. The pipeline company has already held information sessions about the project in communities along the route.

Is Keystone in the National Interest? Of Canada, That Is? | DeSmog Canada

Is Keystone in the National Interest? Of Canada, That Is? | DeSmog Canada.

keystone xl

It’s up to the U.S. President to decide whether the cross-border leg of the Keystone XL pipeline is in the national interest of his country. Ultimately, his criteria are less scientific than political. Does he stand to lose more by alienating those who support or oppose the project?

With midterm elections coming up in November, Obama doesn’t have time to worry about Canada’s hurt feelings. Our economy, environment and opinion are very low on his list of priorities.

But the strongest pro-Keystone arguments on the American side raise an uncomfortable question: if the pipeline is approved, who benefits a little bit — and who benefits a lot? In other words, who gets the short end of the stick?

Houston-based Forbes contributor Loren Steffy lays out the business logic behind Keystone XLwith a clarity you’d be hard-pressed to find on our side of the border:

“[In 2011], for the first time in six decades, the U.S. exported more gasoline and diesel than it imported. The bulk of the exports went to Mexico, Canada and Brazil. Mexico and Canada, even without Keystone, are two of our biggest suppliers of crude (Canada is No. 1; Mexico is No. 4 behind Saudi Arabia and Venezuela). Gasoline, of course, is more expensive than crude, so we are in effect importing raw materials, adding value, and selling it back at a higher price – and maintaining U.S. jobs in the process.”

Catch that? It sounds a lot like the old story about exporting logs and buying back the furniture. Our domestic politicians tell us we’re an “energy superpower,” but to hear U.S. analysts describe it, we’re more of a convenient resource colony.

Canada is a rare duck indeed: a developed nation that is also a net exporter of crude oil. But the U.S. is catching up, thanks to a different kind of oil. The crude coming out of North Dakota’s Bakken shale is light and sweet. Canada’s is higher in sulphur and carbon content, while lower in energy and therefore value.

We produce light crude too, but not enough to match domestic consumption. And we don’t have the refineries to handle our own heavy oil. So we import light crude and gasoline to make up the difference, and send our low-grade stuff to the U.S.

We’re producing so much oil sands crude that we’ve overwhelmed cross-border pipeline capacity. Now the industry is stuck in a Catch-22. Profit margins have dropped dramatically. To reassure investors, bitumen miners talk about dramatically expanding production. But the more we produce, the more we exacerbate the supply glut.

The industry’s best hope right now lies in pipelines like the Keystone XL.

Back to Barack Obama. He doesn’t care about the woes of Canadian oil sands producers. His job is to calculate the U.S. national interest — or at least a version he can sell to voters. Last week’s State Department environmental impact report gave him more political cover on the question of increased carbon emissions.

Yes, operating the pipeline would be like adding 300,000 cars to the road. Yes, Canadian crude is worse for the atmosphere than the other heavy grades it would displace. But, the reportargues, without Keystone much of the same oil would find its way to the same refineries by rail — creating even more emissions than the pipeline, and significantly increasing the risk of accidents.

Rejecting Keystone, the report finds, won’t stop Canadian producers from digging up oil. The question is how they get it to customers.

“Keystone is important to the U.S. because it amounts to an energy insurance policy,” wrote Loren Steffy in Forbes. “Keystone gives us improved access to Canadian crude, which, with or without Keystone, is likely to remain some of the cheapest in the world.”

Is it smart for the president to lock in a stable supply of cheap oil from an eager neighbour? Yes. Is it smart to provide short-term jobs for U.S. construction and refinery workers? Yes. Will the political benefits outweigh the backlash? It’s a good bet Obama will decide yes.

The voters who will be most upset are probably the Nebraska ranchers whose lands will be expropriated. But they’re already Republicans.

Many backs will be slapped and victory cigars chomped in Calgary and Ottawa, the day Keystone XL is approved. Stephen Harper and his cabinet ministers will, no doubt, claim full credit.

Who will be the real winners? Oil companies, certainly. The Government of Alberta, which badly needs the royalties.

On a more modest level, perhaps the Canadian treasury. More than half the federal government’s revenue now comes from personal income tax. So the bean counters will be happy at the prospect of higher wages in the oil patch, so long as wages don’t drop in other parts of the economy.

But remember, oil and gas together make up less than 7% of Canada’s GDP. The entire sector pays 4.2% of total corporate taxes. And it provides only 3% of the jobs in the country. What’s good for oil sands companies is not necessarily the same as what’s good for the nation.

How about ordinary Canadians? Perhaps we’ll feel a fleeting sense of pride that our low-grade crude has found a loving home in the big Gulf Coast refineries. Then we’ll go fill up our gas tanks.

Image credit: www.keystone-xl.com

Why The Keystone Pipeline Will Actually RAISE Gas Prices In the U.S. Washington’s Blog

Why The Keystone Pipeline Will Actually RAISE Gas Prices In the U.S. Washington’s Blog.

Big Oil Is Gaming the System to Raise Domestic U.S. Prices

Bloomberg notes:

Completion of the entire [Keystone] pipeline would raise prices at the pump in the Midwest and Rocky Mountains 10 to 20 cents a gallon, Verleger, the Colorado consultant, said in an e-mail message.The higher crude prices also would erase the discount enjoyed by cities including Chicago, Cheyenne and Denver, Verleger said.

CNN Money reports:

Gas prices might go up, not down: Right now, a lot of oil being produced in Canada and North Dakota has trouble reaching the refineries and terminals on the Gulf. Since that supply can’t be sold abroad, it reduces the competition for it to Midwest refineries that can pay lower prices to get it.

Giving the Canadian oil access to the Gulf means the glut in the Midwest goes away,making it more expensive for the region.

Tyson Slocum – Director of Public Citizens’ Energy Program – explains:

How does bringing in more oil supply result in higher gas prices, you ask? Let me walk you through the facts. A combination of record domestic oil production and anemic domestic demand has resulted in large stockpiles of crude oil in the U.S. In particular, supplies of crude in the critical area of Cushing, OK increased more than 150% from 2004 to early 2011 (compared to a 40% rise for the country as a whole). Segments of the oil industry want to import additional supplies of crude from Canada, bypass the surplus crude stockpiles in Oklahoma in an effort to refine this Canadian imported oil into gasoline in the Gulf Coast with the goal of increasing gasoline exports to Latin America and other foreign markets.

***

Cushing typically is a busy place – I noted in my recent Senate testimony how Wall Street speculators were snapping up oil storage capacity at Cushing. And all of that surplus capacity is pushing WTI prices down – and for many in the oil business, downward pressure on prices is a terrible thing. As MarketWatch reports, “[B]y running south across six U.S. states from Alberta to the Gulf of Mexico, [the Keystone pipeline] would skirt the pipeline hub at landlocked Cushing, Okla., a bottleneck that has forced Canadian producers to sell their oil at a steep discount to other crude grades facing fewer obstacles to the market.

***

There are several global crude oil benchmarks, and the price differential between Brent and WTI now is around $10/barrel, which is a fairly significant spread, historically speaking. Moving more Canadian crude to bypass the                WTI-benchmarked Cushing stocks, the industry hopes, will align WTI’s current price discount to be higher, and more in line with Brent.

***

The Keystone pipeline isn’t just about expanding the unsustainable mining of … Canadian crude, but also to raise gasoline prices for American consumers whose gasoline is currently priced under WTI crude benchmark prices.

Slocum notes that oil is America’s number 1 import at time same that fuel is America’s number 1 export.

Specifically, more oil is being produced now under Obama than under Bush. But gas consumption is flat.

So producers are exporting refined products. By exporting, producers keep refined products off the U.S. market, creating artificial scarcity and keeping U.S. fuel prices high.

Slocum said that the main goal of the Keystone Pipeline is to import Canadian crude so the big American oil companies can export more refined fuel, driving up prices for U.S. consumers.

 

Tom Steyer points out:

Statements from pipeline developers reveal that the intent of the Keystone XL is not to help Americans, but to use America as an export line to markets in Asia and Europe. As Alberta’s energy minister Ken Hughes acknowledged, “[I]t is a strategic imperative, it is in Alberta’s interest, in Canada’s interest, that we get access to tidewater… to diversify away from the single continental market and be part of the global market.”

And see this NBC News report.

As Fortune explains, the U.S. is now an exporter of refined petroleum products, but Americans aren’t getting reduced prices because the oil companies are now pricing the fuel according to Europeanmetrics:

The U.S. is now selling more petroleum products than it is buying for the first time in more than six decades. Yet Americans are paying around $4 or more for a gallon of gas, even as demand slumps to historic lows. What gives?

***

Americans have been told for years that if only we drilled more oil, we would see a drop in gasoline prices.

***

But more drilling is happening now, and prices are still going up. That’s because Wall Street has changed the formula for pricing gasoline.

***

Until this time last year, gas prices hinged on the price of U.S. crude oil, set daily in a small town in Cushing, Oklahoma – the largest oil-storage hub in the country. Today, gasoline prices instead track the price of a type of oil found in the North Sea called Brent crude. And Brent crude, it so happens, trades at a premium to U.S. oil by around $20 a barrel.

***

So, even as we drill for more oil in the U.S., the price benchmark has dodged the markdown bullet by taking cues from the more expensive oil. As always, we must compete with the rest of the world for petroleum – including our own.

This is an unprecedented shift. Since the dawn of the modern-day oil markets in downtown Manhattan in the 1980s, U.S. gasoline prices have followed the domestic oil price ….

In the past year, U.S. oil prices have repeatedly traded in the double-digits below the Brent price. That is money Wall Street cannot afford to walk away from.

To put it more literally, if a Wall Street trader or a major oil company can get a higher price for oil from an overseas buyer, rather than an American one, the overseas buyer wins. Just because an oil company drills inside U.S. borders doesn’t mean it has to sell to a U.S. buyer. There is patriotism and then there is profit motive. This is why Americans should carefully consider the sacrifice of wildlife preservation areas before designating them for oil drilling. The harsh reality is that we may never see a drop of oil that comes from some of our most precious lands.

***

With the planned construction of more pipelines from Canada to the Gulf of Mexico, oil will be able to leave the U.S. in greater volumes.

This isn’t old news … or just a hypothetical worry.

As Bloomberg reported in December 2013:

West Texas Intermediate crude gained the most since September after TransCanada Corp. (TRP) said it will begin operating the southern leg of its Keystone XL pipeline to the Gulf Coast in January.

[West Texas Intermediate oil] prices jumped to a one-month high, narrowing WTI’s discount to Brent. TransCanada plans to start deliveries Jan. 3 to Port Arthur, Texas, via the segment of the Keystone expansion project from Cushing, Oklahoma, according to a government filing yesterday. Cushing is the delivery point for WTI futures. Crude [oil pries] also rose as U.S. total inventories probably slid for the first time since September last week.

“With the pipeline up and running, you are going to see drops in Cushing inventories,” said Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts. “It drives up WTI prices far more than Brent. You are going to see a narrowing of the Brent-WTI differential.”

Transport Safety Board Releases Safety Recommendations for Oil By Rail Shipment | DeSmog Canada

Transport Safety Board Releases Safety Recommendations for Oil By Rail Shipment | DeSmog Canada.

The federal agency investigating the Lac-Megantic oil train derailment and explosion that killed forty-seven people released recommendations last week to improve the safety of shipping crude oil by rail. If the recommendations are implemented by the federal government they will serve as a strong step forward in protecting communities living along railway lines.

“The federal transport minister has a clear choice: protect public safety or secure profits of oil companies,” says Keith Stewart, a climate and energy campaigner with Greenpeace Canada.

One of the country’s most active lobby groups – the Canadian Association of Petroleum Producers (CAPP) – responded to the recommendations earlier this week. CAPP asked the federal government “to ensure their implementation does not interrupt service and respects the competitiveness of transporting our products by rail.” In other words, new regulations should not interfere with business as usual for the oil industry.

“Companies have to pay the price for safety. Their profits cannot come before communities, the environment and general safety,” John Bennett, director of the Sierra Club Canada told DeSmog Canada.

The Transport Safety Board (TSB) made three recommendations to Transport Canada improve safety of oil-by-rail shipments: tougher standards for the susceptible-to-rupturing DOT 111 tank cars, strategic routing of oil trains that considers the environment and communities, and emergency response plans for rail lines transporting large volumes of oil.

Greenpeace and the Sierra Club welcome the recommendations. Both organizations have been pushing for stricter oil by rail transport rules since before disaster struck Lac-Megantic, Quebec on July 6th of last year. Rail company CN also supports the TSB’s recommendations. Rail tank cars are owned either by shipping companies or oil producers. Rail companies on the other hand own the rails, and are liable for derailments.

The recommendations focus on tank cars, not the rails themselves, which is one of the shortcomings of the recommendations. Improvements on both are needed.

Recommendations cannot protect the public if they are not implemented. Bennett is not very optimistic the recommendations will be applied by the federal government. Many TSB recommendations in the past, he says, have “just sat there” and were not adopted, like rail line improvement recommendations made after the Lake Wabamun derailment in Alberta in 2005.

Stewart speculates the federal government will wait to see what the U.S. does, something he thinks is very problematic.

“Lives are at risk. Canada should be taking a leadership role,” Stewart told DeSmog from Toronto.

The TSB and the U.S. National Transport Safety Board announced their safety recommendations for oil-by-rail intentionally at the same time. Transport Canada has ninety days to reply to the TSB’s findings. Upon release of the recommendations in Ottawa on January 23rd, TSB chair Wendy Tadros insisted “change must come and it must come now.”

If adopted, applying the recommendations may prove to be difficult. Rerouting oil tank cars away from densely populated or environmentally sensitive areas is difficult due to Canada’s limited rail options.

Emergency response plans also require greater communication between shippers in the public, especially regarding large oil shipments. Shippers have been reluctant to do this in the past.

“Canadians need to ask themselves why are we doing this? Transporting oil more – whether by rail or pipeline – is a risk with little to no benefits for communities because it is going for export,” says Bennett, who is based in Ottawa.

“We already have enough infrastructure to meet our own oil consumption needs,” Bennett told DeSmog Canada.

Oil tank car shipments in Canada have dramatically jumped from five hundred carloads in 2009 to 160,000 last year, but Canada’s consumption of oil has declined during the same period. All of the recent pipeline proposals in Canada are destined to export oil out of the country with the exception of the Line 9 pipeline in Ontario and Quebec.

“The federal government would be more than happy for this debate to be rail versus pipeline oil shipments,” says Stewart.

“The debate should really be between dirty energy and clean energy and why we continue to invest billions in infrastructure for the fossil fuel industry when that money should be used to fight climate change and reduce our dependence on oil,” Stewart told DeSmog Canada.

The oilsands boom in Alberta and the Bakken shale oil boom in North Dakota coupled with stiff opposition to new pipeline approvals have been blamed for the massive increase in oil-by-rail transport in North America. In the US, oil tank carloads went from 10,800 in 2009 to 400,000 in 2013.

Image Credit: Transportation Safety Board

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