Canada to Make Concessions to Obama to Get Keystone Pipeline Built

Ken Silverstein | Sep 09, 2013

When President Obama vowed to cut greenhouse gases in the United States, Canadian officials got increasingly nervous. Our friends to the north desperately want to build the Keystone XL Pipeline and are now trying to woo our president with newfound concessions. Will it work?

Canada’s Prime Minister Stephen Harper has buttonholed President Obama at the G20 to discuss the cross-border line that would carry Canadian tar sands southward. It’s a follow up to a letter that the prime minister penned, which says he would like to work with the United States to “reduce greenhouse gas emissions from the oil and gas sector,” all as a way to get U.S. approval for the line.

From Obama’s perspective, his toughest election-oriented battles are behind him. So, he is free to Okay the line without suffering any recourse from his environmental base. The president said in June 2013, however, that he would only approve the 1,600-mile line that would carry about 900,000 barrels of oil a day if the $7 billion project did not result in additional greenhouse gases.

Just how that calculation is arrived at is vital. That is, the tar sands will get drilled and ultimately transported, before that gooey oil is refined. It would either head south via the proposed Keystone XL Pipeline or perhaps through the existing railroad system. Or, conversely, it could move westward and then get herded onto ships that are headed to China. The ride to China would certainly create a larger carbon footprint than would the cross-border pipeline.   

Canada’s Natural Resources Minister Joe Oliver is now in the nation’s capitol. He is expected to tell U.S. Energy Secretary Ernest Moniz that Canada will cut its carbon footprint in accordance with the President Obama’s demand. To the extent that such moves by Canada would nudge the president forward on this issue is still an unknown.   

The U.S. Department of State, which must Okay all cross-border transactions, is in Canada’s corner. That is the same agency that has already said that Canadian production of its huge tar sands deposits would not increase if the line is built. Therefore, the level of carbon emissions would not be any higher than otherwise.

Politically Free

But this is as much about politics as it is the environment or the economy. Keystone is, well, a line in the sand. The green movement believes that stopping construction would send a message that cutting into the effects of climate change is a top policy consideration.

“While emissions in the United States are falling, Canada’s moving North America the wrong direction with the tar sands industry’s rapid rise in carbon emissions in Canada,” says Danielle Droitsch, a director of Canada’s Natural Resource Defense Council. “There is only one way the Obama administration can address the rising emissions from tar sands in Canada, and that is by rejecting the Keystone XL pipeline and working with the Canadian government to cap tar sands production.”

Critics, furthermore, say that refining Canadian tar sands will result in 20 percent greater carbon emissions than traditional oil. They add that the thick oil could escape and damage local water resources.   

They also say that the northern country is unable to meet its global greenhouse gas targets under the best of circumstances -- ones that require it to reduce such releases by 17 percent by 2020, from 2005 levels. They add that Canada is now merely paying lip service to those obligations and that any promises made to President Obama are not worth a thing.

To be clear, portions of the line have been operating in the United States since 2010. Meantime, the pipeline is now getting extended from Oklahoma into Texas, where the oil will be refined. But the contentious section is from Alberta, Canada and through Montana, Nebraska and South Dakota.

Earlier, Nebraska balked but reversed course, given that it was able to get the line re-routed. The state also concluded that the tar sands would not be any more corrosive than light crude oil and that refining it would not result in more energy use or more greenhouse gases.

That last segment of the line, though, will carry much of the tar sands, which is why it is getting the most scrutiny: It would ultimately transport as much as 900,000 barrels a day compared to 590,000 barrels a day, according to Merrill Matthews, a scholar with the Institute for Policy Innovation, in USA Today.

Lobbying efforts by Canadian officials are increasing the heat that Obama is already feeling. The president will listen carefully to all viewpoints but in the end, he is free to pursue his convictions.

Twitter: @Ken_Silverstein

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