Tag Archives: Tar Sands

Valero meeting TODAY 3/24, 6:30-7:45pm

Repost from the Vallejo Times-Herald
[BenIndy editor’s note: Everyone should attend this meeting, to hear Valero explain itself, and to share with Valero’s managers and employees the genuine questions and concerns we have about crude by rail.  The criticisms of Valero’s proposal are many and varied, and represent the concerns of everyday folks and highly trained scientists and professionals.  See Project Review.  To join with others who oppose crude by rail, sign the petition here or at SafeBencia.org. – Roger Straw]

Community meeting planned in Benicia on Valero crude-by-rail project

By Tony Burchyns, Vallejo Times-Herald 03/19/2014

BENICIA — The Valero Community Advisory Panel will host a community meeting Monday to discuss Valero’s controversial crude-by-rail project.

According to Valero Benicia refinery officials, the meeting’s purpose is to inform the community, especially Benicia residents, about what Valero believes is the importance of the project, both to the refinery and the city.

It will be held from 6:30 to 7:45 p.m. at Ironworkers Union Local 378, 3120 Bayshore Road. Because of limited space, RSVPs are required by calling 707-654-9745 or via email to info@beniciacbr.com. For more information, visit www.beniciacbr.com.

The panel consists of Valero officials and members of the City Council, school board, business community and community at large. It was established by an agreement executed in 2000 between the city and Valero to provide an ongoing means of communication about issues of mutual concern.

The subject of the meeting will be Valero’s proposed rail off-loading facility that would allow the refinery to receive up to 70,000 barrels of crude oil per day by train. The project’s draft environmental impact report is due out next month.

Project critics have raised concerns about rail safety and the possible use of highly flammable Bakken crude from North Dakota. Critics also have raised concerns about the possible use of Canadian tar sands oil, regarded as more polluting than other crudes.

An opposition group, Benicians for a Safe and Healthy Community, have organized events and launched a website — www.safebenicia.org — to give voice to these concerns.

Valero officials, however, have repeatedly said the project wouldn’t increase emissions. They argue it would generate jobs and help the refinery stay competitive through better access to North American crude stocks.

Phillips 66 Santa Maria: “crude-by-rail strategy3”

Repost from CalCoastNews.com, San Luis Obispo County

Phillips 66 rail project – explosive risks far outweigh the benefits

March 24, 2014
OPINION By MESA REFINERY WATCH
GROUP CHAIR PERSON LINDA REYNOLDS

rail oil

In 1955, San Luis Obispo County approved a plan to bring crude oil to its Nipomo Mesa Santa Maria Refinery via pipeline. Over the years, the Nipomo refinery was operated by Conoco Phillips, without issue, under agreed-upon limitations and protections.

In 2012, Conoco Phillips spun off Phillips 66 as a separate company. On the cover of its very first annual report, that new company’s executives stated “We’re taking a classic in a new direction.” That direction has become painfully evident with the company’s proposed “rail terminal project” for the refinery in Nipomo, which, as far as its impact on SLO County, would be a dramatic transformation in Phillips’ business model and method of operation.

Their revamped corporate business model is to maximize profits by turning our nation’s rail lines into inherently unsafe “tank car pipelines” to take advantage of the new flood of lower-cost Canadian tar sands 1 and domestic fracked crude oils.

The scope of what Phillips intends:

And that’s the strategy Phillips intends to implement at their Nipomo refinery. Instead of bringing in crude by pipeline, they propose bringing in a half-billion gallons (488,000,000) of crude per year, via 20,800 rail tank cars. In addition, those cars may very well contain Bakken crude — the explosive crude that has destroyed lives, property and the environment in towns across the U.S. and Canada. Phillips has repeatedly refused to rule out the delivery of Bakken crude to its Nipomo refinery.

Plus, the crude would travel through SLO County via DOT-111 cars — tankers that federal officials have called “tragically flawed, causing potential damage and catastrophic loss of hazardous materials during derailments.”2

We suggest you view the devastating impact these trains have already had on communities. Go to this site – http://tinyurl.com/mmbotzu.

The mile-long trains would move from north to south through SLO County. Here are just some locations where citizens could almost reach out and touch the tank cars, and the approximate distances:

• The Fairgrounds in Paso Robles (500 feet).

• Paso Robles’ downtown City Park (500 feet).

• Templeton Park (1,000 feet).

• The Santa Margarita elementary school (500 feet).

• Cal Poly (across the street).

• SLO City Hall (2,000 feet).

• French Hospital (right next door).

• SLO County regional airport (3,000 feet).

• SLO’s Los Ranchos elementary school (in their backyard)

• Pismo Beach Premium Outlets (2,000 feet).

• Pismo Beach’s downtown restaurants (1,400 feet).

• Pismo Beach North Beach Campground (1,000 feet)

• Pismo Beach Monarch Butterfly Grove (across the street)

• Grover Beach’s busy junction of Highway 1 and Grand Ave. (right next door)

• Oceano Beach’s busy junction of Highway 1 and Pier Ave. (right next door)

• Arroyo Grande’s Lopez High School (1,300 feet)

We believe the vastly increased risks that this proposal brings to the citizens and businesses throughout SLO County and the Central Coast are unacceptable. The risks of massive explosions, fires, oil spills, and air, noise, odor and light pollution, enormously outweigh the benefits the plan bestows on an individual business entity — that is, Phillips 66. Any honest risk, benefit analysis would lead to that conclusion.

It’s not about “jobs,” it’s about implementing a crude-by-rail strategy:

Phillips is holding the specter of lost jobs (they employ 140 people) over the heads of the citizens and officials of SLO County, should the Nipomo rail terminal project be denied. Let’s look at the issues:

• Phillips has said they require the project because California crude oil sources to feed their pipeline have been in decline for more than 20 years, since 1987. This time-span was stated by Phillips at the February 24th South County Advisory Council meeting, so they’ve known about the decline for more than two decades.

• Yet, around 2009, Phillips applied for a 10 percent increase in production at their Nipomo refinery, all to be brought in via pipeline. So why, if they knew for two decades that there was a decline in their raw material, would they recently apply for an increase in production, specifically from pipeline sources?

• The reason — the entire “declining California crude” argument, accompanied by the potential loss of jobs, is a red herring. It’s designed to distract us from the real reason they have for bringing in crude oil by rail.

• In fact, while California crude oil production has declined somewhat as a source for their refinery, the amount of crude processed at Nipomo in 2012 was exactly the same as it was 10 years prior in 2003, and it all continued to come in via pipeline. In addition, applications now abound in SLO County for new crude oil drilling sites.

• The real reason for requesting a Nipomo RAIL terminal, is that Phillips “corporate” has changed their business model. And their executives have proudly called it their “crude-by-rail strategy 3.” Their desire is to take advantage of low-cost, high-profit, extremely volatile, fracked shale oil. And the only way to quickly implement it all is via “crude-by-rail.”

Our health and safety trumps Phillips’ new business model:

Phillips wants to introduce a “new normal” into SLO County. That new normal includes potential explosions, fires, pollution and health hazards that do not currently exist here.

If a company that had never conducted business in SLO County came to the supervisors and planning commissioners tomorrow, with the same new business model and associated risks, we’re certain it would be rejected. The safety and well-being of our citizens trumps the new direction in which Phillips intends to take us all. That’s why our planning commissioners must vote “no project.”

1 – http://www.mercurynews.com/ci_23366256/canadian-tar-sands-crude-heads-bay-area-refineries

2 – http://www.schumer.senate.gov/record.cfm?id=345384&

3 –Phillips 66 2012 Summary Annual Report; page 27

Exxon Valdez anniversary: Rail spill response compares unfavorably to water-born spill response

Repost from KPIX5 CBS SF Bay Area

Rail Safety Of Bay Area Oil Shipments Doubted

March 24, 2014 2:20 PM

A KPIX 5 crew captured this video of Bakken crude oil getting unloaded from a train at a rail yard in Richmond. (CBS)

A KPIX 5 crew captured this video of Bakken crude oil getting unloaded from a train at a rail yard in Richmond. (CBS)

SSAN MATEO (KCBS) – Last summer’s oil train accident in Quebec that killed 47 people has lawmakers and others in the Bay Area concerned that it could happen here as the volume of crude oil from fracking and other petroleum products arriving from North Dakota and Canada to local refineries surges.

On Monday’s 25th anniversary of the 1990 Exxon Valdez spill in Alaska, State Sen. Jerry Hill (D-San Mateo) said he fears the response to major oil spill will [fall] far short.

“Some of the trains that coming in—the tanker trains that crude oil will have 2.7 million gallons of oil on those trains,” he said.

In 2011, about 9,000 tank cars filled with crude oil were shipped into California by rail. In the next two years, that number is expected to jump to more than 200,000, according to the California Energy Commission.

About 10 percent of the oil will be headed to the five Bay Area refineries.

While most agree the response to water-born spills is good – the Cosco Busan tanker that struck the Bay Bridge in 2007 as an example – inland spills, however, are inherently different.

“When this oil is coming through California at the volume that it’s coming and the magnitude … we want to make sure that our citizens are adequately protected. We really don’t have the resources in place to do it,” Hill said.

Gov. Jerry Brown’s budget calls for a new 6.5 cents per barrel rapid response fee, but that’s for overland crude oil shipments only.

“Ethanol is just as toxic, hazardous chemical and there’s nothing in place to deal with that type of a spill.”

Curt Clumpner is a member of the Fairfield-based International Bird Rescue and got his experience during the 1990 Exxon Valdez spill in Alaska. He said the trains that traverse California do so alongside our rivers.

“It obviously increases the risk in terms of the environment and wildlife,” he said.

KCBS KPIX 5 and San Francisco Chronicle Insider Phil Matier said there are environmental activists who are against oil as a rule and will use such a possibility to scare people while the oil industry will likely oversimplify the issue by saying there is no need for concern.

“The truth is somewhere in between. We’ve had ethanol and we’ve had crude oil come around before but not in this volume.”

NBC report: If Keystone Pipeline is not built: more oil by rail

Repost from NBC News

What Happens if the Keystone XL Pipeline Isn’t Built?

By Lisa Riordan Seville

After five years, it appears the Obama administration will soon issue a decision on whether to build the long-delayed and controversial Keystone XL oil pipeline, which would cross an environmentally sensitive area of the Great Plains and move nearly a million barrels of oil a day to Gulf Coast refineries.

Backers of the project say it would stimulate the U.S. economy and enhance energy security, stressing that a new pipeline is the cheapest, safest way to transport dirty tar-sands crude from Canada’s booming oil fields to U.S. refineries.

Environmentalists, who earlier this month chained themselves to the White House fence in protest, counter that it would endanger the water supply in several states and exacerbate climate change. They want to stop or slow the exploitation of an energy source the Sierra Club calls “the most toxic fossil fuel on the planet.”

Graphic: TransCanada's Keystone pipelines  
Reuters

But what happens if, after all the shouting, the pipeline isn’t built? NBC News consulted with experts on both sides of the debate to provide some possible answers about the impact on the environment, the economy and the global oil supply.

“We don’t think there’s any way that the oil will stay in the ground,” said Matt Letourneau, a spokesperson for the U.S. Chamber of Commerce’s Institute for 21st Century Energy. “Certainly the market will find a way.”

More oil moves by rail. Will more spill?

As oil production has surged in North Dakota’s Bakken region and Alberta’s oil patch, the volume of oil moved by rail has increased exponentially. With the rapid growth of “crude by rail” has come a series of derailments, some involving explosions and one, in Lac Megantic, Que., resulting in nearly 50 fatalities.

The crude from Canada, far less flammable than that from the Bakken, is unlikely to explode. But the tar-like oil does present major cleanup problems if it spills, particularly in water.

Without Keystone XL, more crude will likely move by rail both to Canada’s Atlantic and Pacific coasts and down into the U.S.

Last month the State Department released an environmental impact statement predicting three possible scenarios if the President decides to block the pipeline. All three point to more crude by rail. The oil would either 1) move to Oklahoma by train before being shipped by existing pipelines, 2) ship by rail to British Columbia before being loaded on tankers, or 3) travel directly by rail from Alberta to the Gulf.

In addition to the potential for derailments, shipping oil by rail is more expensive than moving it via pipeline, which could add to the end cost for consumers. Regardless, some companies are already moving forward with rail transport expansion, independent of Keystone’s fate. About 16 different rail terminal projects have been announced in Canada and the U.S., with the potential to move about 1.5 times as much oil as the projected volume for Keystone XL.

So far, rail shipment of Canadian crude isn’t expanding as quickly as expected. A recent analysis by Reuters found rail shipments of Canadian crude to the Gulf Coast were 40,000 barrels per day in 2013, far below industry projections of 200,000 barrels per day by the end of 2013. Statistics obtained by Reuters from Canada’s National Energy Board indicated deliveries to the Gulf Coast may have now reached 57,000 barrels per day, still short of projections.

Image: The proposed termination point for the Enbridge Northern Gateway Project  
Darryl Dyck / AP file 
The Douglas Channel, the proposed termination point for an oil pipeline in the Enbridge Northern Gateway Project at Kitamaat, British Columbia, Canada, Jan. 2012. The fear of oil spills is especially acute in this pristine corner of northwest British Columbia, with its snowcapped mountains and deep ocean inlets.

New Pipelines – But Not in the U.S.

As the Keystone XL project has languished, pipeline companies have proposed a number of other projects to move oil out of Alberta, most of them entirely on Canadian soil.

TransCanada, the company that wants to build Keystone XL, recently took the first step in the approval process for a different pipeline, a massive project that would snake nearly 2,800 miles from Alberta to Eastern Canada. “Energy East” would transport a whopping 1.1 million barrels of crude a day to refineries in Quebec and terminals on the Atlantic coast.

The next largest project, Kinder Morgan’s proposed TransMountain pipeline, would carry about 890,000 barrels a day in the other direction to the coast of British Columbia.

Enbridge, another major Canadian pipeline company, has two projects in the works — the Northern Gateway, which would send 520,000 barrels a day to the coast of British Columbia, and its Line 3 replacement, which could move 760,000 barrels a day from Canada into Wisconsin. Because Line 3 would replace an existing cross-border pipeline, the company argues it would not need the presidential permit that has held up Keystone XL.

If all the projects are approved, more than 4.1 million barrels of oil could flow through Canada by 2018. But the projects could be delayed by opposition from some of Canada’s aboriginal “First Nation” communities. Several proposed routes would cross aboriginal land. Canadian law gives them the leverage to block or redirect the projects, and some groups have already said they intend to fight.

Click here to see a map with all proposed pipelines to the Atlantic, Pacific, Gulf Coast and Great Lakes.

Oil Goes to China

If approved, the alternative pipelines could provide slower, more circuitous routes to America’s Gulf Coast refineries. They could also provide more direct routes to other markets, like those burgeoning in China and India.

Much of the crude that would have been refined in Gulf Coast refineries would have then been shipped to end users in Asia. But cutting out the U.S. middleman could mean more crude going straight to Asia – and new refineries in Asian countries to process it.

The threat of cheap crude slipping through America’s fingers to China has become a key talking point for pipeline advocates. Bill Day, a spokesman for the oil company Valero, which operates a Port Arthur, Tex. refinery that would receive oil via Keystone XL said that this could mean costs to the environment as well as the American economy.

“It’s going to come out of the ground, it’s going to get processed,” said Day. “We think it would probably be better to be processed here under our environmental rules rather than China.”

China’s state-owned companies have already invested heavily in Alberta’s oil sands. In 2012, Asian firms sunk nearly $30 billion in the area. Investments slowed last year after Canada changed some rules governing foreign investment, and after the Chinese companies already on the ground encountered roadblocks building pipelines. But investments are expect to climb again this year.

Image: A protest against the proposed Keystone XL oil pipeline  
Manuel Balce Ceneta / AP file 
Demonstrators lie down along Pennsylvania Ave. in front of the White House during a protest against the proposed Keystone XL oil pipeline, March 2. The protestors say the pipeline would contribute to global warming.

The Environmentalists Get What They Want – Sort of

Environmentalists want to delay or prevent the pipeline because doing so, they believe, will delay or prevent the extraction of Canadian tar-sands oil, estimated to be the world’s third-largest oil reserve. They’d prefer that the U.S. focus on alternative energies instead of searching for new sources of fossil fuel.

They also have a particular dislike for tar-sands oil, which is dirtier and heavier than other crude. When it spills it sinks in water and is hard to clean up. The Keystone XL pipeline would ship this dirty, heavy oil over one of the largest supplies of underground fresh water in America, Nebraska’s Ogallala Aquifer.

Opponents of Keystone are right, in part, to think that blocking it will slow down production. Without the pipeline, the supply of oil has so far exceeded the oil companies’ capacity to ship it out of land-locked Alberta to its largest market — the U.S.

The glut has driven down prices, making development in the region less attractive. A pipeline would not only make shipping faster and easier, it would lower the cost of transport, making the product still more attractive to customers.

“Industry plans to triple tar sands production over the next 20 years, and they simply will not be able to do it without pipeline capacity,” said Anthony Swift, an attorney with the National Resources Defense Council, a vocal opponent of the project. “We’re seeing projects begin to get cancelled as it becomes apparent that pipelines aren’t coming in as quickly as industry expected.”

But even without the pipeline, and with the cancelled projects, production is rising. A market assessment by Canada’s National Energy Board released in November estimated that Canadian crude production is on track to soar to nearly 6 million barrels per day — thanks in large part to oil coming from the sticky sands that have become the symbol of the debate over the energy future of North America.