Keystone XL: So Close, But No Ball, Charlie Brown (Oilgasmonitor.com)

Anyone in the industry knows better than to rejoice about something that looks like good news, yet, who could help indulging in even the most fleeting sense of victory when the State Department announced its most recent findings on Keystone XL?

For the fifth time, the State Department concluded that Keystone XL would neither significantly increase emissions, nor harm the environment, seemingly signaling a green light for President Obama to approve the project.

Yet, like Lucy always pulling away the football before Charlie Brown can kick it, so goes the ongoing battle over Keystone XL. So close, it seemed, but no ball, Charlie Brown.

Though the State Department compared the expected outcomes of an exhaustive array of alternatives and concluded that Keystone XL is the best and safest method of transporting product from the oil sands, what looked like a green light for Obama’s long-awaited approval quickly turned back to red.

Nebraska Not Ready to Play Ball Yet

First, a Nebraska District Court judge invalidated Nebraska Governor Dave Heineman’s approval of the Nebraska section of Keystone XL by striking down a 2011 law that granted TransCanada eminent domain within Nebraska. Declaring the governor’s decision “unconstitutional and void,” the judge ruled that the Nebraska Public Service Commission (PSC) has jurisdiction over the pipeline. Appeals and creation of a new permit process could stretch many months.

The Nebraska section of the pipeline has already created years of delays, with opponents railing against the originally proposed route and forcing planners to find an alternate.

On top of the new delaying tactics in Nebraska, now the Democrats are looking for more ways to muck up the works again on the federal level. Arizona Democratic Representative Raul Grijalva has called upon the Government Accountability Office to probe the State Department’s findings, citing conflicts of interest. California Democratic Senator Barbara Boxer then jumped on the bandwagon, holding a press conference on “the harmful health implications associated with tar sands oil and the proposed Keystone XL pipeline.”

These two are certain to be only the first of many Democrat lemmings flocking to one of their favorite cause célèbre.Boxer’s grandstanding could be easily swatted away with the State Department’s latest findings, which include the unavoidable truth that the oil sands will be developed regardless of what our government decides to do with Keystone XL.

Grijalva’s claims seemed more troublesome, casting a shadow over those very State Department findings. Oh, oil sand development will happen, is already happening, no matter what. Whether Keystone XL will happen is now still very much in question, thanks to Grijalva’s allegations, even though the State Department’s internal oversight office announced Feb. 26 that it had found no breaches of protocol or improper handling of potential conflicts of interest. Don’t expect that to calm Grijalva.

Boxer’s Battle Already Lost

Senator Boxer doesn’t seem to be very current in her oppositional research. She cannot stop development of the oil sands. It’s already happening.

According to the State Department’s Final Supplemental Environmental Impact Statement:

“approval or denial of any one crude oil transport project, including the proposed Project, is unlikely to significantly impact the rate of extraction in the oil sands or the continued demand for heavy crude oil at refineries in the United States based on expected oil prices, oil-sands supply costs, transport costs, and supply-demand scenarios.”

In addition, the “Supplemental EIS notes that the transportation of Canadian crude by rail is already occurring in substantial volumes. It is estimated that approximately 180,000 bpd of Canadian crude oil is already traveling by rail.”

Grijalva Allegations Call State’s Findings Into Question

For proponents of Keystone XL, there was so much to love in the State Department’s latest study. It found that Keystone XL is the safest method of transporting Canada’s crude. It noted that Canada is and will continue developing the oil sands, with or without Keystone XL. It outlined the significant economic benefits of Keystone XL. It underscored the types of climate changes we can expect regardless of whether or not Keystone XL goes forward. It warned that if Keystone XL is not approved, states like North Dakota and Minnesota could soon see more than a dozen new 100-car trains transporting petroleum products every day. It projected 49 injuries and six fatalities per year as a result of increased train traffic, if Keystone XL is not approved, versus one injury and no fatalities if Keystone XL is approved.

Some of that good news remains intact, but if Grijalva continues to push allegations of conflicts of interest that are ultimately found to be legitimate, it all goes out the window. That’s because Grijalva is saying that the State Department relied on the expert analysis of Environmental Resources Management (ERM), one of four contractors recommended by TransCanada. Grijalva maintains that ERM failed to disclose multiple conflicts of interest, including recent work with TransCanada on the Alaska Pipeline, bids on upcoming work with TransCanada, and membership in a lobbying group partly owned by TransCanada.

It’s enough to cast a pall over what should have been a victory dance. And it’s enough that we find ourselves, once again, waiting and wondering if Charlie will ever get to kick that ball and Keystone XL will ever deliver crude to the U.S.

Written By: Chris Faulkner

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