Democrat Socialism, Energy, and Pipeline Hysteria

Obama's dictate that the private sector not create 20,000 construction jobs now and up to 465,000 future jobs in the U.S. by denying the Keystone XL pipeline, is a highly enlightening illustration of the environmental and global warming hysteria of many of the supporters of the Democrat Socialist Party.  Let us examine this pipeline and energy hysteria more closely and learn.

In 2009, there were 148,622 miles of oil and oil product pipelines in the U.S.  There were also 1,539,911 miles of natural gas pipeline in the U.S.  The Keystone XL project wanted to add 1,661 miles of oil pipeline to this massive network of pipelines.  Some of the major pipelines now in existence are shown in the map below.

The green-coded pipelines are major oil pipelines, the red lines are major gas pipelines, and the blue lines are product pipelines.  The Keystone XL pipeline will bring 830,000 barrels a day of Canadian tar sand crude oil from Alberta down through Montana, South Dakota, and Nebraska to link to an already operating 298 mile pipeline segment across Kansas to the important storage and transit center of Cushing, Oklahoma.  It will then build a segment from Cushing on to the Gulf Coast oil refineries at Port Arthur and Houston, Texas.  These Gulf Coast refineries have been hurting recently due to reduced production of Mexican and Venezuelan oil by the inefficient national oil companies of those countries.  This supply of dependable Canadian oil will be a godsend to these important oil refineries.  The pipeline would be built at an actual construction cost of $7 billion for the portion in the U.S. by TransCanada to supplement a smaller pipeline capacity of 435,000 barrles a day already in use bringing Canadian tar sands oil to oil refineries at Wood River and Patoka, Illinois near St. Louis with a branch to Cushing, Oklahoma.  The Keystone XL and present TransCanada pipelines are shown in the map below:

The red and blue lines are the existing lines, while the dashed lines are the new pipelines to be built.  One of the objections to the pipeline is that it crosses the Ogallala Aquifer (misspelled in the US State Dept. map) shown in blue.  This aquifer is found in 8 states and is a very important aquifer.  If you examine the map of major pipelines above, you will find that a great many pipelines already cross the Ogallala Aquifer.  These pipelines were built with older pipeline technology and without anywhere near the critical examination given to the Keystone XL Pipeline project.  Most general oil spill concerns by environmentalists would be better directed at the 149,000 miles of older oil pipelines.  For instance, many of these pass under riverbeds at a depth of 8 feet, while the Keystone XL Pipeline will be buried 25 feet below riverbeds.  The Keystone XL Pipeline will have the latest in protective coatings and be built with more corrosion resistant and stronger steel than many older pipelines.

The single environmentalist objection that may have some merit is that the Keystone XL pipeline will cross the permeable sands of the Sand Hills in Nebraska where the Ogallala Aquifer is particularly shallow and vulnerable.  After the Obama administration decision to delay a decision on the pipeline until 2013, TransCanada has just announced that it is considering several route changes to avoid or minimize the transit distance of the pipeline in the Sand Hills.  The Sand Hills cover the northern and western areas of Nebraska.  At least two of the existing major oil pipelines shown in the upper pipeline map above cross both the Sand Hills and the Ogallala Aquifer under them.  If this were a problem, the State Department should have made an early decision against the pipeline and demanded it be rerouted then.  If this is a critical environmental matter, the existing pipelines through the Sand Hills and over the Ogallala Aquifer should be shut down.

My expectation is that this is not that critical an environmental matter because there are already huge natural oil and gas deposits in and around the Ogallala Aquifer.  Check out the shale oil deposits map below:

We see that the Palo Duro, Niobrara, and Excello/Mulky shale oil deposits are co-located with the Ogallala Aquifer.  There are also extensive traditional oil fields in the Texas panhandle and western Oklahoma.  The southwestern area of Kansas has many natural gas fields.  Oil oozes to the surface in many areas of Texas and Oklahoma and yet the water supplies are rarely contaminated.  Many major oil fields are crossed by rivers and yet there is no significant pollution of those rivers.  Over-active imaginations can create many nightmare situations, but they actually require more unusual circumstances than one would expect to occur.

While one would hope that at worst a rerouting of the Keystone XL pipeline will still allow it to be built, one can count on the environmentalists to continue their many other objections and to do everything they can to prevent the pipeline.  One of their biggest beefs is that they claim that much CO2 is emitted in extracting the bitumen and oil from the tar sands in northern Alberta.  Concern about this is based on the fallacious hypothesis that CO2 emissions will result in catastrophic global warming.  In any case, improved extraction methods have reduced the emitted CO2 by 38%.

There are other environmental concerns expressed pertaining to water use in Canada, but these are concerns we should leave to the Canadians.  In any case, they are going to proceed to develop their tar sands projects and will sell the oil to the Chinese if we refuse it.  Still another environmentalist objection to the import of Canadian oil from the tar sands is that it is an obnoxious oil to refine.  Our Gulf Coast refineries will be using it to replace Venezuelan oil in large part and Venezuelan oil is also a nasty oil to refine.  Our refineries are quite capable of handling nasty oil, while satisfying the EPA.

Among the great advantages of the Keystone XL pipeline is that it skirts the western edge of the Bakken shale oil formation in North Dakota, Montana, and Saskatchewan.  It will be able to take on 65,000 barrels a day of the light and sweet crude oil from the Bakken formation.  This oil is highly valued by oil refineries since it is very easy to process.  There is a very great need to add to the pipeline capacity for transporting our own Bakken shale oil to the refineries of the Gulf Coast.  It is estimated that the pipeline will save $36 million to $146 million a year in costs for Bakken oil.

Oil and gas related jobs have risen by almost 200,000 since 2003, making this one of the few bright spots in the U.S. economy.  This has happened despite consistent opposition from Democrat Socialist environmental groups.  U.S. oil production has risen for the first time since the mid-1980s and natural gas output has far exceeded expectations to the point that natural gas prices are now very low.  Gulf Coast refiners would save $473 million a year if only 400,000 barrels a day of oil were delivered to them. 

TransCanada has already invested $2 billion in the Keystone XL Pipeline and is suffering from a lack of income from money it has borrowed due to having already waited for 33 months to get approval.  The total investment by TransCanada will be $13 billion, but with other related investments by other companies, the total investment may come to $20 billion.  The Wall Street Journal reports that there will be 131,000 jobs created during the construction phase with 13,000 working on the actual construction of the pipeline.  During the construction phase, state and local tax revenues will increase by $600 million.  After construction, the pipeline will increase property tax revenues by $5.2 billion over its lifetime.

The environmentalist objections, to which the Obama administration has acceded, are mostly bogus and wrongheaded.  Greater problems exist with already installed pipelines, though such problems are exaggerated.  The one problem with some justification is going to be addressed with a route change now, but this was mishandled and could have been dealt with long ago so that jobs would be created now in the private sector.  Even this objection to the Sand Hills transit is likely exaggerated and misplaced in that other pipelines with older technology and practices already transit the Sand Hills and the underlying Ogallala Aquifer.

More fundamentally the environmentalists are objecting to the use of inexpensive and reliable energy sources while falsely claiming that we can meet our needs with so-called green energy.  Never mind that the so-called green energy is expensive and unreliable and whenever any particular project is considered it almost always meets determined opposition from environmentalists.

Obama denied the TransCanada application to build the Keystone XL pipeline until at least 2013 because the Democrat Socialist Party is fundamentally opposed to man improving his lifestyle and security through his voluntary cooperation with others in the private sector.  It demands control of every individual's value choices and the power to squelch their independent choices is maintained by demanding that it micromanage our individual lives.  Gaining control of all of our commercial, livelihood activities requires complete control over our use of energy.  This is why the EPA, State Department, Dept. of Energy, NOAA, and NASA are all united with environmentalist groups everywhere to keep Americans from having inexpensive and reliable fossil fuel energy by any means possible.  This is why, despite constant rhetoric about being focused on creating jobs, this Obama administration is only in the business of killing private sector jobs.

It is by no means clear that the great effort of TransCanada to create many jobs throughout our economy and the Canadian economy will succeed in the end.  We are far better off with Canadian oil taking the place of Venezuelan and Saudi Arabian oil from the reliability of supply standpoint.  It is much wiser to enrich Canadians than to enrich Hugo Chavez or the Saudi Princes.  Besides just being better people, the Canadians will spend much more of their added wealth on American goods and services than will Venezuelans and Saudis.

Our having the option of a larger supply of Canadian oil always gives us the chance of acquiring less expensive oil and that gives us a general advantage throughout our economy.  Manufacturing and transportation costs will come down and that will make us much more competitive in international markets.  Americans will be able to raise their standard of living due to lower costs, more jobs, and increased exports.  These are very serious advantages and we should be adamant in opposing the Democrat Socialist Party in its consistent efforts to deny these advantages to Americans.  While many followers of that party are simply thoughtless and ignorant, there are many also who are simply mean-hearted, brutal, and too envious to think straight.

There are plenty of Democrat Socialists who do not have the personal ethics to refrain from doing great damage to their fellow man.  Indeed, this knowledge that they lack such personal ethics is part of the reason they project such maliciousness of intent upon everyone in the private sector.  Strangely, they block knowledge that if this were the nature of man, then the actions of man in the government sector would be as bad, indeed worse.  Because it is mostly Progressive Elitists who are drawn to roles in government, we generally do observe avarice, mean-heartedness, and ruthless suppression of others at the heart of our over-grown and unconstitutional government.  Obama is their leader and he must depart in 2012 if our economy and lifestyle are to improve.