Making the environmental and economic point for Keystone XL

Contributed to The Huffington Post
Greg Stringham
Vice President of Oil Sands
Canadian Association of Petroleum Producers
March 22, 2013

As Canadian crude oil producers and the largest supplier of crude oil to the United States, we believe the proposed Keystone XL oil pipeline between the two countries would strengthen our mutually advantageous relationship - the largest bi-lateral energy trading relationship in the world.

Keystone XL, planned in part to carry Canadian oil to the U.S. Gulf Coast, offers a conduit between responsible, secure suppliers and willing customers, all within North America.

Canada already supplies more oil to the U.S. than any other country. Current exports are about 2.5 million barrels per day or about 25 per cent of total U.S. oil imports. About one million barrels per day comes from the oil sands in Alberta.

The chemical composition and life-cycle greenhouse gas emissions of oil sands crude oil are similar to other heavy crude oil transported and refined in the United States. Crude from Canada's oil sands has been transported safely via pipelines in North America for more than 30 years and poses no greater risk than any crude oil.

Total Canadian crude oil production is forecast to more than double over the next 15 years. Meanwhile, existing pipelines between Canada and the United States are increasingly running near capacity.

That's why Keystone XL was proposed in the first place, along with several other pipeline projects in Canada and the United States. Additional transportation capacity within Canada, to the U.S. and beyond will be needed to meet growing demand for Canadian oil.

The International Energy Agency says worldwide energy demand will rise 35 per cent by 2035, requiring responsible development of all forms of supply including hydrocarbons for the foreseeable future.

Canadian oil sands expansion, pipeline construction and maintenance of U.S. refineries processing oil sands crude oil represent billions of dollars of potential investment and thousands of skilled jobs in Canada and the United States. There are more than 2,400 companies in the U.S. that currently provide goods or services to the Canadian oil sands industry.

KXL has been extensively reviewed during its five-year regulatory process. Overall environmental impact was examined in detail by the U.S. State Department and deemed minimal in an earlier report. In January, the Nebraska government reached the same conclusion when it reviewed the latest proposed pipeline route through the state.

Most recently, the State Department's supplementary environmental assessment of the new pipeline route was released. Consistent with past studies, the assessment said Keystone XL's environmental impacts are negligible and the project would result in "no substantive change in global GHG emissions."

Keystone XL would have no impact on the global climate. U.S. greenhouse gas emissions will be similar because the oil sands crude oil earmarked for the pipeline would replace current U.S. imports of similar heavy oil from Venezuela and Mexico.

All energy development has environmental impacts, including oil sands. Our job is to responsibly manage the environmental impacts so citizens can benefit from the energy and jobs provided.

Canadian oil sands operations account for just 0.16 per cent (1/600th) of global GHG emissions. Nevertheless, our industry reduced GHG emissions associated with every barrel of oil sands crude oil by 26 per cent since 1990 and continues to seek new ways to reduce emissions through technology and innovation.

Our objective is to perform as well or better than competing global oil suppliers. Of the top five suppliers of oil to the U.S. - Canada, Mexico, Nigeria, Saudi Arabia and Venezuela - only Canada has greenhouse gas regulations in place. The Alberta government implemented GHG regulations in 2007 and Alberta's carbon price ($15Cdn/tonne) is more than double the current value per tonne of carbon in the European carbon trading system.

Other oil sands environmental performance successes include increased recycled or non-potable water use, reduced surface disturbance and improvements in reclamation technology. These actions are ongoing through the development and implementation of innovative technology.

A recent poll shows most Americans strongly prefer oil from Canada rather than other supply sources such as countries in the Middle East. The poll indicates a vast majority of Americans believe U.S. government policies should support the use of oil from Canada's oil sands.

Reasonable people support Keystone XL because it's positive for both countries. This pipeline is not about how much oil the U.S. chooses to use, it is about where the U.S. gets that oil.

As stated previously, geography makes us neighbors. Social, economic and political ties make us strong allies. Nowhere is this more evident than in our energy trading relationship.

We hope you agree: Canadian oil is the right oil, from the right country.

Greg Stringham
Vice President, Canadian Association of Petroleum Producers