CONNECT
NationofChange / Op-Ed
Published: Thursday 1 March 2012
“The gasoline and diesel that would be made from this Canadian crude would not go to American gas pumps, but to foreign markets”.
The Keystone XL Flim-Flam
For Rep. Allen West, the skyrocketing price of gasoline is not just a policy matter, it's a personal pocketbook issue. The Florida tea-party Republican (who, of course, blames President Obama for the increase) recently posted a message on Facebook wailing that it's now costing him $70 to fill his Hummer H3.
It's hard to feel the pain of a whining, $174,000-a-year congress-critter, but millions of regular Americans really are feeling pain at the pump — especially truck drivers, cabbies, farmer, commuters and others whose livelihoods are tethered to the whims of Big Oil. It's an especially cynical political stunt, then, for congressional Republicans, GOP presidential wannabes and a chorus of right-wing mouthpieces to use gas price pain as a whip for lashing out at Obama's January decision to reject the infamous Keystone XL pipeline.
This friendly Canadian corporation, they cried, would send 700,000 barrels of "tar sands crude" oil per day through the 2,000-mile-long pipeline that it would build from Alberta, Canada, to Texas refineries on the Gulf Coast. "Less dependence on OPEC," they chant like a mantra, "more gasoline for America, lower prices for consumers." What's not to like?
Well, aside from inevitable environmental damage from pipeline leaks, and the fact that this foreign-owned corporation would use the autocratic power of eminent domain to take land from unwilling sellers along the 2,000 mile route, here's something not to like: The gasoline and diesel that would be made from this Canadian crude would not go to American gas pumps, but to foreign markets.
The dirty little secret that those pushing so urgently for building Keystone XL don't want you to know is that the tar sands oil producers are in cahoots with Texas refineries to move the product onto the lucrative global export market, selling it to buyers in Europe, Latin America and China — not to you and me.
The pipeline and the toxic crude it'll carry across six states would do absolutely nothing to shave even a penny off of the price we pay at the pump.
Already, U.S. refineries are exporting records amounts of the gasoline they make. For the first time in 62 years, America is now a net petroleum exporter. Valero Energy Corp., the largest U.S. exporter of refined petroleum products, is a major lobbyist for Keystone XL. Along with Motiva (an oil refiner jointly owned by Shell and Saudi Aramco) and Total (a French refinery), Valero has signed secret, long-term contracts with Keystone's owner (TransCanada Corp.) and several tar sands oil producers to bring this crude to Port Arthur, Texas. All three have upgraded their refineries there to process diesel for export.
Adding to Big Oil's enjoyment is the fact that the Port Arthur refineries of Valero, Motiva and Total are within a Foreign Trade Zone, giving them special tax breaks for shipping gasoline and diesel out of our country. And adding to the dismay of some U.S. consumers, TransCanada has quietly boasted that Keystone XL would cut gasoline supplies in our Midwestern states, thus raising prices at the pump and siphoning more billions of dollars a year from consumers’ pockets into the vaults of multinational oil interests.
So, let’s tally the score in this Keystone pipeline deal: The American people's environment would be put at risk, foreign nations would get the fuel, pipeline and oil investors would get the tax-subsidized profits, and we'd all stay hooked on deadly polluting oil. Meanwhile, the financial speculators and supply manipulators who are artificially causing our gasoline prices to rise escape scrutiny, while self-serving politicians (tanked up on Big Oil's and Wall Street's campaign cash) divert attention to the bugaboo of Obama's pipeline decision.
And, yet again, our nation has an excuse to postpone the necessary investments in conservation, alternative fuels and mass transit that will actually solve the gas-gouging problem.
What's not to like?
Copyright Creators.com
Get Email Alerts from NationofChange
ABOUT Jim Hightower
National radio commentator, writer, public speaker, and author of the book, Swim Against The Current: Even A Dead Fish Can Go With The Flow, Jim Hightower has spent three decades battling the Powers That Be on behalf of the Powers That Ought To Be - consumers, working families, environmentalists, small businesses, and just-plain-folks.
Top Stories
By Kiley Kroh
15 comments on "The Keystone XL Flim-Flam"
March 05, 2012 3:20pm
Has anyone asked why Canada and Canadian-Transco won't refine this stuff at the point or origin, and pipe the final product to the Gulf for shipment? The volume will be much smaller, required infrastructure to pump it will be less and Canada keeps its byproducts.
If the refining is all in Texas by an existing refinery that needs major modifications, will it be replaced for domestic oil and gas needs? Is the oil barons setting us up for long term shortages every time there is a storm, the switch to either summer or winter blends? The oil barons had many refineries inland that refined local crude for local distribution, but they were closed for the most part. The industry wanted a 95% to 105% refining capacity, meaning they are always short and can charge what they want.
It is long past time to Nationalize the oil and energy industry as a strategic commodity. If you have stocks in oil, sell. You'll be able to look at yourself in the mirror.
March 02, 2012 9:05am
We need Tax Reform. "Tax Em Like 1938".
March 01, 2012 7:25pm
What Jim Hightower and others fail to mention, is that the Tar Sands oil is the dirtiest oil imaginable. No amount of refining will bring it up to US standards - therefore, it HAS to be shipped abroad. Let other countries pollute our atmosphere - we can blame it on them, and Obama has appeased (fat chance of THAT) the GOP by putting the screws to WE, the People, again.
March 02, 2012 10:05pm
If it's so dirty, why do other countries want it?
March 02, 2012 6:44am
Ronni--how can you say Obama put the screws to WE? He said no to a pipeline that will threaten our environment, raise gas prices for WE and only create profits for oil companies. How does that translate into putting the screws to WE?
March 01, 2012 7:11pm
We are so f@#$%d! The wall street zombies win again.
March 01, 2012 3:55pm
How do we keep our oil here? Keep it in the ground and go to some other source of energy that's more sanely connected to the surround which tries hard to nurture us even as we try to hard to resist.
March 01, 2012 2:44pm
choices are 1- have oil refined in USA [USA jobs] where they are sold will be driven by price [USA price vs forgein price plus transportation cost] or 2 piped to kitimai sold oversea to be refined no [USA JOBS]
March 01, 2012 2:26pm
Let's consider the Energy Returned on Investment for tar sands:
EROI = 1.3-5 : 1
This means for every unit of energy put into tar sands extraction, only 1.3-5 units of energy are obtained for future use. Not exactly a great investment of time or money, and that's without considering the huge amounts of wetlands that are strip-mined and the clean water that becomes polluted in the extraction process.
The low EROI tells us that tar sands are really dirty and getting a barrel of crude oil is not a simple process. In fact, for 1 barrel of crude, it takes 4 barrels of clean water, and 2 tons of moved dirt.
All that dirt is moved using GIGANTIC equipment: dumptrucks with tires 2 stories tall and "draglines" that are 22 story tall backhoes that can hold 23 compact cars in their bucket. Wow, that's a lot of dirt and it only takes 1 driver to operate a dragline. Only 1 driver to operate the world's largest dump truck. For all the talk about jobs, that's not a lot of workers.
And after we use 4 barrels of clean water to remove the sand from the sticky, low-grade oil, the water is toxic, so we just build a big pond and put it in there (tailings pond). Some of the largest human-made structures on the planet are tar sands tailing ponds. And if you thought the Chinese dam across the Yangtze River was big, the second largest dam in the world holds back a toxic tailings pond from tar sands strip mining in Canada.
Of course to ducks and other waterfowl those toxic lakes look just like a welcome place to rest and stay the night. Thankfully, the big oil corporations are as concerned about those ducks getting sick as you are, and they've installed propane cannons around the tailings ponds to scare waterfowl away -- hopefully before they land.
So, how can oil corporations make so much money off of tar sands if it takes so much fossil fuels to get 1 barrel of crude. Well, that's where you and I come in -- the Canadian and American taxpayer. You see, we cover most of the costs of new roads, equipment, pipelines, etc., so the oil company only has to worry about how much a barrel of crude is selling on the global market and put that money in their pocket.
Wow, I really feel like my tax dollars are up to good work, and making huge amounts of our precious freshwater undrinkable, too!
The oil industry never dreamed it would be mining tar sands for crude oil when oil used to be easy and the EROI was 100 : 1 in the 1940s. But, with the end of fossil fuels clearly in sight, we're running straight ahead toward getting every last drop while we use up every last drop. In the meantime, all the solar and wind infrastructure that we need to be building while we still have fossil fuels around is on hold. I guess the plan is to try to convert to a new energy source once we don't have any fossil fuels left to make that transition possible.
And don't get me started on hydro-fracking for natural gas. That EROI is only 2 : 1!
March 01, 2012 4:16pm
Thank you for that crisp analysis and summary Ms Zanatell -it's just the kind of insight we need to justify the derision and outrage that the XL Pipeline concept and it's blind or corrupted promotors deserve.
March 01, 2012 1:09pm
Why doesn't someone post How To Keep The Oil In The States? I'm glad you're telling us that the oil is leaving the country, but can someone tell us how to keep the oil HERE?
March 08, 2012 5:48pm
Why do you want to keep the oil here, especially this very nasty and highly toxic tar sands oil? We don't need this dirty oil; we have plenty of oil. We are EXPORTING gasoline, for crying out loud. Further, it's better to export it and make a buck rather than store it in a place, the USA, that is increasingly using less and less of it. A better question is: Why are we so slow at getting the green industries going? China's doing 'green', why aren't we?
March 01, 2012 12:30pm
NOTE: The gasoline and diesel that would be made from this Canadian crude would not go to American gas pumps, but to foreign markets.
That dirty little secret that those pushing so urgently for building Keystone XL don't want you to know is that the tar sands oil producers are in cahoots with Texas refineries to move the product onto the lucrative global export market, selling it to buyers in Europe, Latin America and China — not to you and me.
Therefore, the only way that any American Citizen should ever support the Keystone XL Pipeline would be with Congress adding a provision to the Bill that would require that all the Crude oil that passes through the Pipeline must be sold to American Citizens or Canadian Citizens.
In addition we American Citizens should DEMAND that Congress pass a Law that would require that any Crude Oil which is Drilled for in the Territorial Waters of the United states of America or on any American Soil must be sold to ONLY American Citizens in the United states of America for the production of Gasoline to be sold to American Citizens in the United states of America.
March 08, 2012 5:49pm
Theordore: Two thumbs up!
March 01, 2012 9:27am
How is it that the price of spot crude in Denver, Colorado was recently at $83 while WTI was priced at $106?
Okay, so the refineries along the Gulf Coast would crack the crude and send the finished products out of country. Run an export tax on that product and that will make it more feasible for the oil companies to keep the products in country and that amount that is exported would benefit the people of the USA. The idea that Exxon or BP or Chevron or whoever should earn a decent income isn't something to be fought. When federal gas and oil leases are given whereby these companies make huge profits at the expense of the people who actually own the land over which the feds have custodial control, we need to look at how those leases are given. All of the (few) oil companies already have an effective monopoly on the extraction/refinement pathways to market as evidence by the lack of competitively (downward) driven pricing points they adopt.
No, I am not referring to the Canadian Oil Sands as federally leased oil sites, but I am referring to all federal lands on and off shore of the USA as defined by law.