Report: Keystone XL would boost oil sands output, emissions

Keystone XL would lead to higher carbon emissions because of added production of crude from Canadian oil sands, according to a report backed by environmentalists.

The key determination in the report — that oil sands production would grow in Canada only with the construction of Keystone XL — is a source of great dispute between environmentalists, regulators and the oil industry.

A previous State Department review of the pipeline determined that oil sands crude production would grow, with or without Keystone XL.

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The detail is important because production of hydrocarbon-carrying bitumen from oil sands emits more carbon than production of conventional oil. If Keystone XL would cause more production of oil sands crude, those additional projected emissions could factor into federal approval of the pipeline’s construction.

Regulators and oil executives project that there will be several options for moving large volumes of oil sands crude out of Canada, even without Keystone XL. Those include existing or expanding pipeline capacity, rail lines, or through other new pipelines that might move crude to ports, where the product can be loaded onto ships.

The State Department analysis also said that rail car transportation would be a viable alternative to Keystone XL.

“There are enough insulated rail cars that will be delivered by the end of 2014 that could transport a greater volume of oil sands bitumen than the proposed project,” the department’s Draft Supplemental Environmental Impact Statement said.

The Natural Resources Defense Council disagreed with that assessment.

“Rail is expensive for tar sands crude, which is why it has been largely absent in the current crude-by-rail boom,” the council said in a press release on its report.

The report determined that Keystone XL would prompt more oil sands crude production in Canada, which would add between 950 million and 1.2 billion metric tons more carbon pollution over 50 years than if it carried conventional crude oil.

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The report cited State Department data to show that a government denial of Keystone XL would avoid at least 18.7 million metric tons of carbon pollution per year, a figure comparable to the annual emissions reductions expected from new standards for heavy duty trucks.

“Our analysis clearly demonstrates that the Keystone XL pipeline would dramatically boost the development of dirty tar sands oil, significantly exacerbating the problem of climate pollution,” said Susan Casey-Lefkowitz, director of the council’s international program, in a statement. “Approve it, and our children’s future is jeopardized. Deny it, and we’ll avoid sending over a billion tons of additional carbon pollution into the air.”

But the argument from the environmental activist group ignored the ongoing expansion of oil sands crude production, as well as the numerous transportation options for moving that crude that are being developed, said Cindy Schild, senior manager oil sands and refining programs for the oil industry trade association, the American Petroleum Institute.

The addition of rail cars for moving crude, along with other pipeline options currently in development, will move growing oil sands crude output out of Canada, regardless of what happens with Keystone Xl, Schild said.

“The market access is going to happen,” Schild said. “The State Department and other experts continue to repeat the fact that this resource is being developed and it will find its way to the Gulf of Mexico one way or another.”

Construction of the 485-mile southern portion of the Keystone XL pipeline, dubbed the Gulf Coast Pipeline, is nearing completion. Unlike the northern part, it does not cross international boundaries and therefore, does not require State Department approval.