Analysts: Keystone will RAISE my gasoline prices

[JoeTheJuggler]

How long have studies been done on this project.

ETA: What is a typical time frame for approval.

They filed application for a Presidential Permit in September 2008. The EIS was finalized in August, 2011. There's a timeline here.

I have no idea what's typical. I suspect that since this is not a typical project, there is no "typical".

 

[steve s]

And reduce prices overall nationally:

Keystone XL might lower the average cost of gasoline across the U.S. by up to 4 cents a gallon, Ray Perryman, a consultant hired by TransCanada to assess the economic impact of the project, said in an e-mail.

So instead of paying $3.57 per gallon, I'll only have to pay $3.53? Wooohooo!!! DRILL, BABY, DRILL!

Steve S

 

[JoeTheJuggler]

So instead of paying $3.57 per gallon, I'll only have to pay $3.53? Wooohooo!!! DRILL, BABY, DRILL!

And that's the "up to" figure. (If it's proportional to my Uverse actual vs. "up to" speed, it will only raise the price by about a half a cent per gallon!)

So the benefit is pretty minor, and the environmental risk is at least something.

On a side note, I'm not sure why the solution to higher petroleum prices is to extract and burn up existing petroleum as quickly as possible anyway. To me, trying to reduce demand makes much more sense.

 

[JoeTheJuggler]

Have there been any oil pipeline spills in the US that have had lasting effects on anything other than a localized area?

There are regular U.S. pipeline spills. I'm not sure how you define "lasting effects" or what is a "localized area" though.

However, I did find this: "In summer 2010, a million gallons of tar sands oil poured into the Kalamazoo River in Michigan from a pipeline run by another Canadian company, Enbridge. The spill exposed residents to toxic chemicals, coated wildlife and has caused long-term damage to the local economy and ecosystem." Source.

The EIS for the Keystone project says that the highest incidence of spills will be those that remain localized, unless it gets into a waterway. (That's not the exact wording, but it basically says that those that stay localized will stay localized.)

 

[WildCat]

Think about it. The plan puts the terminal end of that pipeline at a port city for a reason. If KXL has the effect of lowering gas prices in the US, the companies that refine that fuel will simply export more of it to countries where they can get a better price, just as they're doing right now.

And exports are bad, right?

 

[WildCat]

So I haven't heard specifically what Obama's objections are.

It hurts his ratings among environmental loons.

 

[Dymanic]

I get the GOP's motivation for opposing almost anything Obama says or does, but I don't really fully understand Obama's objections to this pipeline.

If he's actually in favor of it, but just wants to do it right, he's doing a very poor job of communicating that position to the public.

My guess is that he just wants more time to decide whether he feels that it is something that can be done right -- if "right" is interpreted to mean something like "representing the best possible compromise between risks and benefits once a large number of factors have been taken into consideration".

If that is his position, I don't know where he (or anyone) would begin in trying to package that as a message that could be communicated to the American public. It's not going to fit on a bumper sticker.

 

[Dymanic]

And exports are bad, right?

Is that what you think I said?

 

[JoeTheJuggler]

It hurts his ratings among environmental loons.

You mean there are no legitimate environmental issues?

Appropriately, your name-calling here is simply poisoning the well.

 

[eeyore1954]

There are regular U.S. pipeline spills. I'm not sure how you define "lasting effects" or what is a "localized area" though.

However, I did find this: "In summer 2010, a million gallons of tar sands oil poured into the Kalamazoo River in Michigan from a pipeline run by another Canadian company, Enbridge. The spill exposed residents to toxic chemicals, coated wildlife and has caused long-term damage to the local economy and ecosystem." Source.

The EIS for the Keystone project says that the highest incidence of spills will be those that remain localized, unless it gets into a waterway. (That's not the exact wording, but it basically says that those that stay localized will stay localized.)

Information on the Kalamazoo spill

EPA's cleanup costs to date: $29.1 million. Enbridge will be required to repay the government for all response costs, the agency reports on its website devoted to the incident.
In the end, no one was injured, groundwater supplying residential and municipal water wells has so far remained unaffected, and air monitoring has shown no serious persistent problems, in spite of a lingering odor along the site...
Jeff Spoelstra, executive director of the Kalamazoo Watershed Council, said he looks forward to the final report and the chance to get an idea of the outlook for recovery. So far, the signs have been heartening, Spoelstra said.

Monitoring of air quality and groundwater wells have shown no significant problems there; the frozen wetlands that were trampled by cleanup equipment over the winter months seem to be springing back to life

What happens to the oil remaining in the soil is largely a mystery, he said. In the cold climate of the 1989 Exxon oil spill in Prince William Sound off the coast of Alaska, for instance, more than half of the oil is still there.

Barcelona is part of a team of scientists interested in discovering ways to stimulate the natural bacterial breakdown of the oil. But there's been little study of that area, he said. The study he proposes on property around the Kalamazoo River spill will be the first of its kind, Barcelona said.

 

[WildCat]

Is that what you think I said?

Then what was your point?

 

[WildCat]

You mean there are no legitimate environmental issues?

Appropriately, your name-calling here is simply poisoning the well.

The objection with the loons is the tar sands, which they think they can kill by killing the pipeline. Potential spills from the pipeline are a red herring.

 

[JoeTheJuggler]

My guess is that he just wants more time to decide whether he feels that it is something that can be done right -- if "right" is interpreted to mean something like "representing the best possible compromise between risks and benefits once a large number of factors have been taken into consideration".

Again, if that's his position, then what is going on during this additional time? How was the EIS incomplete?

If Lolmiller is correct, then Obama should be telling the public that he wants more time to do a similar EIS on a new proposal that would avoid the area of concern.

If that is his position, I don't know where he (or anyone) would begin in trying to package that as a message that could be communicated to the American public. It's not going to fit on a bumper sticker.

Pretty much the way I just said it. The company is making a new proposal with an alternate route, and that proposal must be examined, so we need more time.

The official statement on whitehouse.gov only says that he wants more time to read the current EIS. (It is pretty lengthy, and personally, I don't even know what to make of it.)

The preliminary EIS was made roughly a year before the final release (just last November).

 

[JoeTheJuggler]

The objection with the loons is the tar sands, which they think they can kill by killing the pipeline.

Again, name-calling is just poisoning the well. Is your claim that there is no such thing as a legitimate objection to the project based on environmental concerns? (Repeating the word "loons" doesn't address this question.)

Potential spills from the pipeline are a red herring.

Why? Is your claim that spills are impossible? The EIS does not support any such a thing. Is your claim that spills that might cause substantial environmental damage aren't possible? Ditto.

 

[Dymanic]

Then what was your point?

I just know you could have figured that out if you had taken a little more time.

KXL is being pitched as a way of lowering gas prices in the US. But that's not why TransCanada wants to build it. Oil companies do not produce oil and refine it into gas so that Americans will be able to drive their cars (or that they may do so more cheaply). They do those things to earn a profit, and they operate in a global market. That's not a value judgement; it's a simple statement about the way things are.

The fact that the refineries that will process that oil happen to be on US soil does not automatically give US consumers first place in line to buy the finished products. Right this minute, some guy somewhere in this country didn't show up for work today for no other reason than that he could not afford the gas. Had it been a buck cheaper, he could have. In short, he got out-bid by some other guy who did make it in to work today, maybe some guy who doesn't even live in the US. Every time we pull into a gas station and start pumping gas into our vehicle's fuel tank, we -- each and every one of us -- are participating in an ongoing global auction for that fuel. We're bidding. See how that works?

There may be times when the interests of oil companies serve the national interest; it's the very premise behind the massive subsidies they receive from our government. But there may also be times when their interests and our national interests are at odds with one another. In those situations, the corporate executives are responsible to their shareholders for making decisions that will maximize their profits, period -- and the POTUS is responsible for making decisions that place the national interest at the top of the list of priorities. A large segment of our society (including more than one former US President) appears to have been sold on the idea that our national interests and those of oil companies are always compatable. I'm not one of them. President Obama isn't either.

 

[WildCat]

Again, name-calling is just poisoning the well. Is your claim that there is no such thing as a legitimate objection to the project based on environmental concerns? (Repeating the word "loons" doesn't address this question.)

It's a red herring because this group of people (I call them loons, you call them whatever you want) will oppose the pipeline even if it was guaranteed 100% safe. They're actual objection is with the oil sands production in Alberta.

Do you disagree? Do you think any proposed route, or any of the proposed safeguards, will satisfy the groups opposed?

Why? Is your claim that spills are impossible? The EIS does not support any such a thing. Is your claim that spills that might cause substantial environmental damage aren't possible? Ditto.

Who ever said it was impossible? Possible/impossible is not even the right question. The question is do the risks outweigh the rewards? Are the proper safeguards in place? Is this pipelina as safe as it can be?

But it is my contention that the loons see the pipeline as a means to attack the development of the oil sands. They will lobby against the pipeline no matter what. Obama knows this, he just has tro lead them on until after the election. Then he'll release a study that says everything is cool now because we made them do x, y, and z and ok the pipeline. And the environmental loons will scream bloody murder.

That's my opinion, and I think the course of this event will prove me correct.

 

[WildCat]

I just know you could have figured that out if you had taken a little more time.

KXL is being pitched as a way of lowering gas prices in the US. But that's not why TransCanada wants to build it. Oil companies do not produce oil and refine it into gas so that Americans will be able to drive their cars (or that they may do so more cheaply). They do those things to earn a profit, and they operate in a global market. That's not a value judgement; it's a simple statement about the way things are.

Who are these people saying the pipeline was to be bult to lower gas prices? What it certainly can do is stabilize oil prices by increasing production from stable countries as the middle east seemingly becomes ever more volatile. And stability in oil prices is in many respects more important than the actual price.

 

[Ziggurat]

Well, it hasn't done so yet. It's not like many of us really have much option but to pay whatever the going rate happens to be.

If "green" options haven't emerged even in the face of growing oil prices, it's because they can't emerge, at least not yet. Which means that this pipeline wouldn't keep us dependent on oil, because we're going to be dependent on oil regardless.

We're living in a society in which that decision was made decades ago

What decision? To use oil for transportation? Because I gotta tell ya, the alternative was to not have much in the way of transportation.

It's a question of how best to utlilize the last of the cheap oil that remains.

That oil will get pumped out of the ground regardless. The question before us is whether we want it to be piped to America, or shipped to China.

Guess which option has a lower carbon footprint?

 

[lomiller]

If Lolmiller is correct, then Obama should be telling the public that he wants more time to do a similar EIS on a new proposal that would avoid the area of concern.

That was the original plan, and TransCanada was actively working out a new route when Republicans in Congress passed a law that said the pipeline must be approved or denied immediately even though the plan for where the new route would go had not been completed.


As a result the State Department was forced to give an official denial to the proposal, but they encouraged TransCanada to re-apply with the the updated route.

AFAIK TransCanada has yet to re-submit their application because they haven't finalized the route yet so the process is sitting with them, not the State Department or Congress. Once they submit their new application the entire approval process must be restarted from the beginning because the initial request was denied. This normally takes 12-18 months.


(TransCanada is actually one of my larger investment holdings so I follow their news closely)

Pretty much the way I just said it. The company is making a new proposal with an alternate route, and that proposal must be examined, so we need more time.

The official statement on whitehouse.gov only says that he wants more time to read the current EIS. (It is pretty lengthy, and personally, I don't even know what to make of it.)

This statement is older, and came before Congress made their law that killed the project unless it received immediate approval.

 

[Dymanic]

Who are these people saying the pipeline was to be bult to lower gas prices?

Where have you been, under some rock? Is there a Republican anywhere who hasn't made the claim, either direct or implied, that approving the pipeline would help relieve gas prices?

What it certainly can do is stabilize oil prices by increasing production from stable countries as the middle east seemingly becomes ever more volatile. And stability in oil prices is in many respects more important than the actual price.

I can't agree with all of that, but instability in the middle east is always a concern, and the possible advantages the pipeline could provide as a hedge against that is certainly one item for the "benefits" column.