Suppose you were President of the United States.
You don’t like importing foreign oil, but you really don’t like depending on Middle East and other unstable producers for it. So if you could only get it from a friendly neighbor like Canada! That would be great, right? And maybe they’d pipe it right to the center of the country, far from seaports into which the overseas stuff gets shipped. Wouldn’t that be great?
Actually, Mr. (or Ms.) President, that what we’ve got today. Canada is our largest supplier of oil, and it gets piped right into the Midwest, reducing oil costs in our heartland.
But suppose we changed all that. What if, instead, we built a huge 1,700-mile pipeline that runs, not to the heartland, but straight across it to huge export terminals on the Gulf of Mexico. And suppose that this export terminal was tax-free, so that oil exporters didn’t have to pay U.S. duties? And suppose that this pipeline was owned by a foreign company? And suppose that the pipeline contracted to sell its oil to foreign oil companies, which are committed to selling their oil on the world markets to the highest bidders? Suppose there was no intention of keeping the oil here at home?
How does that sound to you, Mr./Ms. President? Are you feeling safer now?
Now, in case you’re actually thinking about running for president, a word of advice: You probably shouldn’t tell the voters in advance that you’d approve something like this. In fact, nobody would do this, right?
Um, well, let me tell you about the Keystone XL tar sands pipeline, and an actual president, named Barack Obama. You already know that the tar sands oil is filthy stuff; that it destroys indigenous tribes in Canada; that it pours mercury and other toxins into northern waterways; that the pipeline will cross 1,904 American rivers
and streams; that it will likely destroy far more jobs
than it creates; and that it generates almost twice as much CO2
as conventional oils. But you were hoping, perhaps, that at least we’d have a captive supply of oil, no?
|Valero’s tar sands oil is going overseas
I’m so sorry, Mr./Ms. President. The Keystone XL pipeline is an export pipeline. It’s owned by a foreign company, TransCanada. And TransCanada has contracted to deliver the oil to seven big oil companies: two are Dutch (Royal Dutch Shell and Trafigura), one is Saudi (Aramco), one is French (Total S.A.), two are Canadian (CNR and Cenovus) and only one is American (Valero).
Well, thank heavens! At least one is loyal to us, right? Surely they’ll keep their share of the oil here at home, right?
Oh, I’m so sorry. Valero, the top beneficiary of the Keystone XL, has explicitly detailed an export strategy to its investors
. They’ve locked in at least 20 percent of the pipeline’s capacity, and it’s going to Europe and South America (see the investor presentation map above). And because its refinery is in a Foreign Trade Zone, the company will export it tax free.
The U.S. will have provided a huge new subsidy to oil companies: importing and transporting massive amounts of toxic fossil fuels across the vital midsection of our country, only to have it exported duty free. The American people bear the risks of spills, emissions and contamination; and companies like Valero reap the profits. The only thing that stays behind is the pollution.
|Total S.A. hardly sells anything in the U.S., with heavy focus on Europe
The same is true for all these companies: Total S.A. has 69% of its gas stations in Europe, and less than 3% in the Americas (none in the U.S.!). All these companies have the exact same motivation: Get the oil as cheaply as possible and sell it to the highest bidder, wherever they are.
These facts highlight a fundamental reality, captured in a report by OilChange International
: “The oil market is fundamentally global. The only way to truly reduce our dependence on foreign oil is to reduce our dependence on ALL oil.”
I’m so sorry to be the bearer of such bad news, Mr./Ms. President: There’s no energy security in this pipeline. Now that you think about it, why would a president ever approve such a project, if corporate lobbying and campaign money was not at stake?
Oh, and what about President Obama? Well, he’s poised to sign the pipeline permit before year end.
More disclosures from Valero
|Where’s the Gulf refinery oil going? Latin America and Europe
|Valero’s tar-sands oil will go to diesel-thirsty Europe