Tag Archives: Keystone XL

Alberta election could send tremors through Montana economy

Repost from The Missoulian
[Editor:  Pay attention to Alberta!  Changes there will send ripples all along the rails in the U.S., from the Upper Midwest to the East Coast, West Coast and Gulf Coast.  Congratulations to Rachel Notley and the New Democratic Party!  – RS]

Alberta election could send tremors through Montana economy

By Rob Chaney, May 09, 2015 5:30 pm
Rachel Notley
Alberta New Democratic Party leader Rachel Notley speaks on stage Tuesday night in Edmonton after being elected Alberta’s new premier. The NDP won a majority in the provincial Legislative Assembly by toppling the Progressive Conservative colossus that has dominated the province for more than four decades. Photo: NATHAN DENETTE, Canadian Press

Montana’s political seismograph didn’t rattle much last Tuesday when its neighbor to the north underwent a governmental earthquake.

But that could change in the coming weeks, as the citizens of Alberta absorb the magnitude of their replacement of Canada’s longest-standing political party rulers with a left-wing opposition pledged to look hard at its energy economy.

“The Progressive Conservative Party has been in power two years longer than I’ve been alive,” said University of Montana biology professor Mark Hebblewhite, a 42-year-old Alberta native. “I think this is a real response to the ongoing mismanagement of Alberta’s bounty. One thing that hit the nail on the head was how the province went from being overrun with money to crashing in another bust. People get really tired of it.”

The New Democratic Party took 53 seats in the Alberta Parliament in Tuesday’s election. Another traditional minority group, the Wildrose Party, surprisingly found itself in second place with 21 seats. The Progressive Conservatives held onto just 10 seats.

NDP party leader Rachel Notley was credited for a remarkable political ground game that unseated Progressive Conservative Party leader Jim Prentice – a man widely considered a future leader of all Canada. Prentice resigned from his post on election night and said he was at least temporarily leaving politics.

Alberta’s entire United States border runs along Montana, from the western edge of Waterton-Glacier International Peace Park to the 110th Meridian north of Havre. The province and state share the spine of the Rocky Mountains and the beginnings of the great mid-continental prairies.

They also share a relatively recent surge in energy development. Over the past decade while Montana has exploited its Bakken oil and gas fields along the border with North Dakota, Alberta has been opening massive production in tar sands petroleum near Fort McMurray.

Oil from the tar sands has become both a political and social controversy.

New Democratic Party officials have questioned the need for the Keystone XL pipeline that would run south from Alberta, through a corner of Montana and down to refineries in Oklahoma and Texas. The Obama administration has stalled permitting of the international border crossing, while Montana’s bipartisan congressional delegation has supported it.

“If the Keystone XL doesn’t happen, the amount of rail traffic leaving Alberta would be impacted significantly from that decision,” said Bentek Energy senior analyst Jenna Delaney. “Currently, taking the Keystone XL out would increase petroleum unit trains by five a day out of Alberta. And Transport Canada officials say residents in Canada are very concerned with rail traveling through their communities.”

Moving petroleum by rail has become an issue in both Canada and the United States, signposted most recently by last week’s explosion of a group of oil tank cars near Heimdal, North Dakota.

Caryn Miske of the Flathead Basin Commission said the prospect of moving more oil trains along the southern border of Glacier National Park is under close scrutiny.

“We’re already seeing impacts from the amount of oil that’s moving around,” Miske said. “The number of trains and cars carrying oil has increased, and that’s really concerning, considering how many near-misses we’ve had.”

Burlington Northern Santa Fe has a freight line that runs out of Alberta into Montana at Sweet Grass, although there’s not much cross-border oil traffic there yet.

***

Delaney said another factor of the government change could be the NDP’s campaign pledge to revamp the province’s tax structure on energy development.

“They’re looking at increasing income taxes and royalty rates to corporations, which the oil companies aren’t happy about,” Delaney said. “The last time I was in Calgary, the atmosphere was already a little bleak. If taxes are raised on corporations, I don’t know how they might respond. Companies with offices in other places might shift people away from Calgary.”

Much of the province’s energy economy has extremely expensive initial start-up costs. Energy analysts have already been forecasting a drop in Albertan oil production as new projects slip below their break-even points with falling oil prices.

Delaney said that could have an impact on Montana’s economy, as the demand for megaloads of oil field equipment transported across the state stalls.

Longtime conservation activist Stephen Legault said the provincial government’s failure to manage its oil wealth led to great voter frustration.

“We’re drilling 20,000 wells a year in Alberta, and we’re $7 billion in the hole economically,” Legault said. “That’s largely because when oil goes below $75 a barrel, provincial coffers take a massive hit.”

The result has been a government unable to fix damage from the floods that ravaged Calgary in 2013, or even to send land management officials to cross-border conferences in Montana.

While the new government has majority control of Alberta’s Parliament, its influence over the provincial agencies could be a murkier matter. Those departments have had decades of one-party control appointing their directors and staffs.

“If I was south of the border looking north, I wouldn’t expect to see anything dramatic right away,” Legault said. “We’ve had five changes of government since 1905. The bureaucracy is so deeply entrenched after 45 years of one-party rule, it’s going to take years for a new government to put in place the people it wants to create change.”

Crude Oil Rail Shipments Sabotage Freedom of Information Act

Repost from Forbes

Crude Oil Rail Shipments Sabotage Freedom of Information Act

By James Conca, May 5, 2015 @ 4:40 AM

New regulations from the U.S. Department of Transportation declare that details about crude oil rail shipments are exempt from public disclosure (Tri-City Herald).

This ends DOT’s existing regulations that required railroads to share with state officials, and the public, information about shipping large volumes of dangerous crude oil by rail. These disclosure requirements were put in place last year after a Bakken crude oil train-wreck in Lynchburg, Virginia.

Now, railroads will only have to share this information with emergency responders who will be mum. And the information will be exempt from the Freedom of Information Act as well as public records and state disclosure laws (SSI).

Better response, slower speeds and safer rail cars are needed to stem the rise of crude oil rail car accidents. Transparency would be nice, too, although that took a real hit last week with the new regulations from the Department of Transportation. Source: National Transportation Safety Board

True, the new regulations do cover critical oil train operations in terms of “speed restrictions, braking systems, and routing, and adopts safety improvements in tank car design standards and a sampling and classification program for unrefined petroleum-based products.” All good things long needed to address the growing dangers in rail transport of crude.

But after the Lynchburg derailment and inferno, the feds required railroads to notify emergency response agencies if shipments over a million gallons crude oil were going through their states. Railroads complied, but asked states to keep that information confidential.

Most states refused (McClatchy).

Since then, the industry argued that details about the crude oil rail shipments were sensitive from a security and customer protection standpoint and should not be available to the public, although it’s more likely they just don’t want to get hassled by a public trying to restrict shipments from going through their towns, across their rivers and along their coasts.

At first, the Federal Railroad Administration disagreed with the industry (Federal Register), saying that information about the shipments was not sensitive from any standpoint.

But they seemed to have quietly caved to industry pressure.

The twin forces of the new North American energy boom and the lack of pipeline capacity have combined to suddenly and dramatically increase crude oil shipping by rail. The energy boom is not going away, and the XL pipeline is on hold indefinitely, so the increase in rail will continue.

Crude is a nasty material, very destructive when it spills into the environment, and very toxic when it contacts humans or animals. It’s not even useful for energy, or anything else, until it’s chemically processed, or refined, into suitable products like naphtha, gasoline, heating oil, kerosene, asphaltics, mineral spirits, natural gas liquids, and a host of other products.

Thus, the need to get it to the refineries that can handle it, mostly along the coasts. Without new pipelines, it’s going to go by rail.

But fiery derailments of crude oil trains in North America are becoming almost frequent, along with many simple spills (dot111). Every minute of every day, shipments of two million gallons of crude are traveling over a thousand miles in hundred-tank-car trains (PHMSA.gov), delivering as much oil as is expected by the Keystone XL Pipeline.

A clear example of this danger came on July 6, 2013, when a train carrying 72 tank cars, and over 2,000,000 gallons of Bakken oil shale crude from the Williston Basin of North Dakota, derailed in the small town of Lac-Megantic, Quebec. Much of the town was destroyed and forty-seven people were killed.

According to billionaire Warren Buffett, these new federal standards for shipping crude oil by rail will definitely slow-up the industry, and as CEO of Berkshire Hathaway’s BNSF railroad and its Union Tank Car business, he should know (Tri-City Herald).

Buffett says railroads are critical for transporting potentially dangerous products across the United States, and he thinks it makes more sense for railroads to haul them instead of trucks or pipelines, a controversial stand given the historical data (Pick Your Poison).

So what is the safest way to move crude oil?

The volume of oil spilled per billion-ton-miles for each mode of transport - truck worse than pipeline worse than rail worse than boat. But it depends upon your definition of worse. Source: Congressional Research Service R43390

The short answer is: truck worse than train worse than pipeline worse than boat (Oilprice.com). But that’s only for human death and property destruction. For the amount of oil spilled per billion-ton-miles, it’s truck worse than pipeline worse than rail worse than boat (Congressional Research Service). Even more different is for environmental impact, where it’s boat worse than pipeline worse than truck worse than rail.

But the accident frequency trend is against rail. Oil trains are getting bigger and towing more and more tanker cars. From 1975 to 2012, trains were short and spills were rare and small, with about half of those years having no spills above a few gallons (EarthJustice.org). Then came 2013, in which more crude oil was spilled in U.S. rail incidents than was spilled in the previous thirty-seven years.

The danger seems to be centered in the rail tank cars themselves (The Coming Oil Train Wreck). If these new regulations makes the rail cars safer, makes them go slower and routes them around environmentally sensitive or vulnerable areas, that’s wonderful.

But I don’t see why we aren’t allowed to know when the crude oil trains are near us.

Alberta’s possible pivot to the left alarms Canadian oil sector

Repost from Reuters

Alberta’s possible pivot to the left alarms Canadian oil sector

By Scott Haggett and Nia Williams, May 4, 2015 7:07am EDT
Alberta NDP Leader Rachel Notley meets with Mayor Naheed Nenshi in his office in Calgary, Alberta, April 30, 2015. REUTERS/Todd Korol

(Reuters: CALGARY, Alberta) – Canada’s oil-rich province of Alberta is on the cusp of electing a left-wing government that can make life harder for the energy industry with its plans to raise taxes, end support for key pipeline projects and seek a bigger cut of oil revenues.

Polls suggest Tuesday’s election is set to end the Conservative’s 44-year reign in the province that boasts the world’s third-largest proven oil reserves and now faces recession because of the slide in crude prices.

Surveys have proven wrong in Canadian provincial elections before and voters may end up merely downgrading the Conservatives’ grip on power to a minority government.

Yet the meteoric rise of the New Democratic Party and the way it already challenges the status-quo of close ties between the industry and the ruling establishment has alarmed oil executives. The proposed review of royalties oil and gas companies pay the government for using natural resources and which could lead to higher levies, is a matter of particular concern.

“Now is not the time for a review of oil and natural gas royalties,” Tim McMillan, president of the Canadian Association of Petroleum Producers, the country’s top oil lobby, said in a statement.

A 2007 increase in the levy was rolled back when the global financial crisis struck and oil executives say today the time is equally bad to try it again.

Yet the left’s leader Rachel Notley, a former union activist and law school graduate, has shot up in popularity ratings in the past months advocating policies that have been anathema for many conservative administrations.

She says she would not lobby on behalf of TransCanada Corp’s controversial Keystone XL pipeline or support building of Enbridge Inc’s Northern Gateway pipeline to link the province’s oil sands with a Pacific port in British Columbia. Citing heavy resistance from aboriginal groups to the Enbridge line, Notley says Alberta should back those that are more realistic such as TransCanada’s Energy East pipeline to the Atlantic ocean.

PACKING UP?

Notley also advocates a 2 percentage point rise in Alberta’s corporate tax rate to 12 percent to shore up its budget that is expected to swing from a surplus to a C$5 billion deficit in 2015/2016 as energy-related royalty payments and tax revenues shrink.

Even with the proposed corporate tax hike Alberta’s overall taxes would remain the lowest nationally. Oil executives warn, however, that any new burdens at a time when the industry is in a downturn, shedding jobs and cutting spending, could prompt firms to move corporate head offices out of the province.

“Business is mobile,” said Adam Legge, president of the Chamber of Commerce in Calgary where most of Canada’s oil industry is based. “Capital, people and companies move.”

Ironically, the challenge the oil industry and the Conservatives face is in part a by-product of Alberta’s rapid growth fueled by the oil-sands boom.

The influx of immigrants from other parts of Canada and overseas has changed the once overwhelmingly white and rural province. Today Alberta is one of the youngest provinces and polls show younger and more diverse population is more likely to support left-wing causes such as environment and education and more critical of big business. The New Democratic Party still only got 10 percent of the votes in the 2012 vote, but an election of a Muslim politician as a mayor of Calgary in 2010 served as an early sign of the changing political landscape.

The Conservatives themselves and their gaffe-prone leader Premier Jim Prentice also share the blame for the reversal of fortunes with one poll showing them trailing the left by 21 percent to 44 percent.

Prentice angered voters when he told Albertans to “look in the mirror” to find reasons for the province’s fiscal woes and then passed a budget in March that raised individual taxes and fees for government services but spared corporations.

Scandals – Prentice’ s predecessor left last year because of a controversy over lavish spending – and blunders added to the party’s woes.

The NDP vaulted to the top of the polls after Notley’s strong performance in an April 23 televised debate, when Prentice, former investment banker, drew fire for suggesting his rival struggled with math.

Then there is voter fatigue with a party seen as too comfortable and scandal-prone after decades in power.

“It’s still the same gang, the same policy, same procedures, the same concept of entitlement,” said one executive at a large oil and gas producer who declined to be named because he is not authorized to talk to the media. “I know some extremely neo-conservative guys who have said enough is enough.”

(Additional reporting by Julie Gordon in Vancouver and Mike De Souza in Ottawa; Editing by Amran Abocar and Tomasz Janowski)

NRDC Attorney: The tar sands invasion that can be stopped

Repost from NRDC Switchboard, Danielle Droitsch’s Blog

The tar sands invasion that can be stopped

Danielle Droitsch
Danielle Droitsch, senior attorney with NRDC, Canada Project Director, International Program.

By Danielle Droitsch, April 28, 2015

Many across the United States are aware of the tar sands threat posed by the proposed Keystone XL pipeline but what many may not know is the U.S. faces a looming threat that is bigger than just this one pipeline. We call it a tar sands invasion. The plan would be to complete a network of pipelines (both new and expanded), supertankers and barges, and a fleet of explosive railway tank cars. What is at risk? San Francisco Bay, Puget Sound, the Great Lakes, the Hudson River and other places we all call home. While the threat of this invasion is already here with the proposed Keystone XL pipeline, the good news is that citizens across North America are rising up to respond and repeal the assault with a clear message: Not by pipeline, not by rail, not by tanker. The good news is that public opposition to tar sands oil is rising and projects like Keystone XL and Northern Gateway have been delayed. The tar sands assault is not inevitable. In fact, the U.S. doesn’t need this dirty form of fuel and neither does Canada. The time has come to limit tar sands expansion in favor of a cleaner and brighter energy future.

Tar Sands Invasion Map 4-27-15.jpg

A new report released by NRDC reveals that the amount of tar sands crude moving into and through the North American West Coast could increase by more than 1.7 million barrels per day if industry proposals for pipelines, tankers and rail facilities move forward. For more information about this new information see posts by my colleagues Anthony Swift and Josh Axelrod. Why the west coast? With the majority of the world’s heavy oil refinery capacity, the United States including the west coast is a critical market for the tar sands industry. To be clear, Keystone XL still remains at the heart of the industry plan to expand tar sands and gain access to the global market. But industry is still pushing hard for other ways to expand especially as KXL flounders. It is important to keep in mind the tar sands industry – which currently produces about 2 million barrels per day (bpd) – plans to triple production to exceed 6 million bpd in the next fifteen years. The oil industry has made clear it needs all of its rail and pipeline proposals to achieve its massive production goals.

We know that the tar sands industry and Canadian government has long had a plan to quadruple or more tar sands extraction in Canada. KXL has always been a huge part of that. But it is now very clear that they also plan to access the U.S. and global market through every means possible.

This threatened invasion puts our communities, waters, air and climate in jeopardy. The Tar Sands Solutions Network has done an outstanding job outlining many of the different campaigns that are emerging across North America. This plan threatens to expose communities from California to New York to health, safety and environmental risks unless the public rallies to stop it. Here are some of the specific impacts that North America faces as a result of the tar sands invasion:

  • Across the West Coast, tar sands laden tanker and barge traffic could increase twenty-five fold, with a projected 2,000 vessels along the Pacific West Coast– including the Salish Sea and the Columbia River–shipping nearly two million barrels of tar sands crude every day.
  • A dozen proposed rail terminals would substantially increase tar sands by rail traffic going through densely populated American citizens like Los Angeles and Albany New York risking explosive derailments of hazardous crude unit trains
  • Nearly a million barrels of tar sands would be destined for California and Washington refineries, exposing fenceline communities in Anacortes, San Francisco and Los Angeles to increasing toxic air pollution.
  • In the Midwest, the pipeline company Enbridge is moving to nearly double the flow of tar sands moving through the Great Lakes region, an area that already has suffered from a 2010 spill of more than 800,000 gallons of the tar sands into the Kalamazoo River in Michigan sending hundreds of residents to the hospital. Four years later, the cleanup, which has cost more than $1 billion, is still unfinished.
  • On the East Coast, the tar sands industry is seeking to build the Energy East pipeline across Canada. The pipeline would run from Alberta east across Canada to New Brunswick and Quebec, carry 1.1 million barrels of tar sands oil per day and require hundreds of oil tankers traveling along the East Coast and Gulf Coast annually, through critical habitat of the extremely endangered Right Whale.
  • In Albany, New York, a proposed oil transfer facility could lead to the shipment of tar sands oil on barges down the Hudson River or rail cars along the river destined for facilities in the New Jersey and Philadelphia areas.
  • In Maine, Vermont, and New Hampshire, the constant threat of a proposed reversal of the aging Portland-Montreal Pipeline is likely to arise again as Enbridge completes work on a pipeline reversal that will connect the tar sands directly to Montreal this summer.
  • This network of pipelines will feed refineries that produce millions of tons of hazardous petroleum coke waste – known as “petcoke” – which are piling up in residential neighborhoods like Chicago.
  • In Canada, pipeline companies are trying to access the west and east costs with pipeline proposals that would ship the heavy tar sands oil across pristine landscapes in British Columbia or across the Prairies into Ontario and Quebec. Communities are raising concerns about the threat of a spill to waters from the pipeline or tankers leaving the Bay of Fundy of the Gulf of St. Lawrence.
  • And last but not least, communities in Alberta at ground zero have been facing the enormous consequences of tar sands development which has brought about significant contamination of water, air, and land. Increasingly, there are calls for a moratorium on development.

Targeting at risk communities

The tar sands invasion puts a high toll on low-income and aboriginal communities located in railway corridors, near oil refineries, and next to petcoke waste sites. In refinery fence-line communities, emissions associated with tar sands are suspected to be even more detrimental to human health than existing harmful emissions from conventional crude. Derailments of tar sands unit trains – mile long trains carrying over a hundred tankers full of explosive tar sands crude – pose a catastrophic risk for communities throughout the country. And as more tar sands oil is refined in the United States, the public will also face increased health and environmental risks from massive piles of petroleum coke, a coal-like waste full of heavy metals that results from tar sands oil refining and can cause serious damage to the respiratory system.

Industry would like for you to believe that tar sands development is inevitable and there is nothing that can be done. Wherever they turn today they are being faced with public opposition. Expansion is not inevitable, especially because of this growing and formidable opposition.

A climate problem

It is clear that tar sands reserves – some of the world’s most carbon intensive – are at the top of the list of reserves that must remain in the ground. Mounting scientific and economic analysis shows that the tar sands industry’s proposed expansion plan is incompatible with global efforts to address climate change. The Intergovernmental Panel on Climate Change (IPCC) concludes that 75% or more of discovered fossil fuel reserves must remain in the ground in order to limit warming to the international two degrees Celsius goal. The clear inconsistency between tar sands expansion and efforts to address climate change have made opposition to tar sands expansion projects a clear rallying point for a broad group of allies advocating for action on climate.

A water problem

A tar sands spill from train, pipeline, or tanker could devastate local economies, pristine wilderness, harm human health, and lead to an especially costly and challenging cleanup. Tar sands spills have proven more damaging than conventional spills, as heavy tar sands bitumen sinks below the water surface making it difficult to contain or recover. A spill from shipping the tar sands crude could devastate communities, contaminate freshwater supplies or marine habitats and damaging local economies.

Undermining efforts to grow our clean energy economy

The growing exploitation of Alberta’s tar sands threatens to undermine North American efforts to build a clean energy economy and combat global climate change. Because most tar sands crude is destined for the United States, its expansion would create a greater dependence on the world’s dirtiest crude oil and undermine our transition to environmentally sustainable energy and a cleaner transportation fleet. Responding to the tar sands invasion will require solutions reduce fossil fuel use and spur low-carbon transportation and energy solutions such as broadened electric vehicle use and development of renewable and clean fuels.

This tar sands invasion can be stopped: Clean Transportation Solutions

The good news is this tar sands invasion can be stopped starting with leadership from government officials to embrace climate and sustainable transportation solutions. NRDC’s report for the west coast outlines detailed recommendations for decision-makers at all levels. The first step is for decision-makers at all levels to become familiar with the unique issues associated with tar sands oil and then to actively identify the full range of solutions to confront this problem. Without action, the U.S. will unintentionally become a thoroughfare for this oil undermining climate policies and presenting risks to communities and water. With support for regional clean energy policies, we can prevent the influx of tar sands crude and build the green infrastructure and public support necessary to begin transitioning to a clean energy economy.