oil sands

The Environmental Voices in Obama’s Ear

March 1, 2015 by Llewellyn King Leave a Comment

In the South they ask, “Who’s your daddy?” In the North, “Where did you go to college?”

In Washington we ask this very real question, “Who’s advising him?” Washington believes in advisers, who are often the authors of big decisions made by others.

When George W. Bush was running for president the first time, I raised the question about his lack of knowledge in foreign policy. One of his staunch supporters countered, “He’ll have good advisers.”

Advisers come in all shapes and sizes in politics. A trusted aide may shape a senator’s understanding of an issue, and set the legislator on a path that later might be regretted but cannot be reversed. “Flip-flop” is a deadly accusation in public life.

When President Obama makes a decision, one wonders on whose advice? Who started the locomotive rolling down the track?

This week, one wonders who led Obama to endlessly delay a decision on the Keystone XL pipeline, which should have been a rather mundane issue until he was backed into vetoing a congressional effort to move the project forward?

There are 2.5 million miles of pipe buried in the ground in the U.S.,190,000 of which carry crude oil. The Keystone XL pipeline would have carried crude for 1,179 miles. It should have been a no-brainer for the State Department, which has jurisdiction because a foreign country, Canada, is involved. It is not hard to make a pipeline safe, and this one would be engineered as no other has.

But a core of dedicated environmentalists saw it as a wedge. Their target was not then and never has been the pipeline, but rather the Alberta oil sands project, where much of the oil would originate. By cutting off deliveries of the oil to the U.S. market, they hoped to wound the project and eventually close it down.

I am no fan of the oil sands – which used to be called “tar sands” – project. I think it is abusive of the earth. It involves massive surface mining and has so scarred the region that the great pit can be seen from space. It is also a contributor to air pollution because the sands have to be retorted with natural gas.

It is not a pretty business wringing the oil from the sands. However, not building the pipeline will not close down the oil sands project as environmentalists have hoped. Only low prices can do that.

The Canadians are angry. They feel betrayed by the White House and stigmatized by outside forces like the Natural Resources Defense Council (NRDC), which has been a relentless antagonist of the pipeline and the oil sands project.

The question is who persuaded Obama? In November 2011, Canada’s minister of natural resources, Joe Oliver, told me at an energy meeting in Houston that he had been told privately that the pipeline deal was done, and he was expecting Obama to sign off on a State Department decision in weeks.

But it did not happen. One or more people in the White House – Obama takes advice from a small circle of advisers in the White House rather than his cabinet secretaries — was able to sow doubt in the president’s mind about the pipeline.

The results: More oil moves by rail car which is resulting in accidents in Canada and the United States. An ally is offended, and there is bad blood that will affect other trade issues. Thousands of construction jobs in the Midwest are lost. Obama looks bad: the captive of a very small part of the constituency that elected him.

There is an echo here of the folly of the president in abandoning the Yucca Mountain nuclear waste repository. On the surface, Obama bowed to the wishes of Harry Reid, then Senate majority leader. It has been accepted by the nuclear industry as a cold, hard political gift to a vital ally.

But as time has gone on, the nuclear spent fuel has piled up at the nation’s power plants, as the cost of the abandonment has risen – it stands at $18 billion. One has to wonder whether one of Obama’s advisers, with an agenda of his or her own, did not whisper to the president, “Harry Reid is right.”

There are no winners on the pipeline issue, just as there were no winners on Yucca Mountain, except those who are celebrating in places like NRDC. On sparkling, organically grown apple juice, perchance? — For the Hearst-New York Times Syndicate

Obama and His Oil Sands Brer Rabbit

February 21, 2013 by White House Chronicle Leave a Comment

If there were an Oscar for political ineptitude, President Barack Obama would be a front-runner for the prize. The president’s possible approval of the 2,000-mile-long pipeline from the oil sands (previously known as the tar sands, and most correctly bitumen sands) of Alberta, Canada to the refineries and shipping terminals of the U.S. Gulf Coast is a tale of political calculation that has gone sadly wrong.

Back in January 2012, when he was expected to give his approval and that of the State Department, to what is an international agreement, the president punted. Concerned about stout opposition in his own administration, and particularly from his Environmental Protection Administration chief Lisa Jackson, Obama demurred and requested more studies.

This did two things: It antagonized the Canadian people, always sensitive to slights from the United States, and humiliated the government of Prime Minister Stephen Harper. Joe Oliver, Canada's minister for natural resources, told me on the record just before Obama’s statement that he had had strong indications from the administration that the Keystone XL pipeline would be approved. In the event, he and the Canadian government were outraged and embarrassed.

As though offending our trading partner and favorite neighbor was not enough, Obama gave the environmentalists time to mobilize — a mobilization so complete that it resulted in a demonstration on the Mall in Washington immediately after the president’s second inauguration.

Not only did a broad front of environmentalists march against the pipeline but in the year since Obama kicked the can down the road, they extended and codified their objections not just to the pipeline, but also to the exploitation of the oil sands. Obama’s delay has allowed the environmental groups to declare a kind of non-governmental trade war against Canada.

Originally, the environmental movement and its supporters in the administration were concerned with the effects of the pipeline in Nebraska and the threat it would pose to rivers and aquifers in the state. While the company that wants to build the pipeline, TransCanada, has agreed to re-routing and Nebraska Gov. Dave Heineman has signed off on the project, the environmentalists have downplayed the Nebraska issues and concentrated on the whole matter of the exploitation of the oil sands. The Natural Resources Defense Council has called oil-sands oil “the filthiest oil in the world.”

This is a mighty assault on the economy of Alberta and Canada, as 44 percent of Canada’s oil exports come from the oil sands and they are scheduled to keep rising. If it were of less economic consequence, the protests might find more sympathy north of the border than they do. Mining the sands is a monumental undertaking, disturbing enormous tracts of earth and employing trucks and mechanical shovels, which are the largest on the globe. The disturbance to the earth is considerable and worth noting.

Also worth noting are the vast quantities of natural gas and water used in the extraction and retorting of the sands. More greenhouse gases are released in the production of the oil than in regular oil fields; the oil sands extraction is calculated to be the largest contributor to greenhouse gases in Canada.

However, Canadians are sensitive to these issues and are offended by the idea that Canada is a backward country with no regard to the environment. Canada maintains that evolving technology is reducing the impact on the environment year after year. The oil sands are going to be developed no matter what.

There is a pattern of escalation in environmental concerns about big projects. Nuclear power gives a fine historical perspective on this escalation. Back in the 1960s, the first concerns about nuclear power were on the thermal effluent into rivers and streams. This escalated into concern about radiation, then safety, then waste and finally a blanket indictment of the technology.

Bogdan Kipling, who has been writing about Canadian-U.S. relations from Washington for four decades, takes an apocalyptic view of the future U.S.-Canada relations if Obama wavers and does not approve the pipeline. In a recent column, he said that such an action would “decouple” the United States from Canada across a broad range of issues, social a as well as economic. “Such a decision would be sweet music to the ears of Canadian nationalists,” Kipling said.

Now Obama finds himself between the swamp of his own political left and the rock of international relations. It did not have to be like this. — For the Hearst-New York Times Syndicate

Fasten Your Seat Belt, Obama’s Driving Energy Policy

January 20, 2012 by White House Chronicle Leave a Comment

By Llewellyn King

If President Obama were driving an automobile the way he's driving energy policy, he'd be stopped and breathalyzed.

The president’s latest decision to defer a decision on TransCanada's Keystone XL oil pipeline is a sudden swerve to the left, after his sharp right turn in curbing the enthusiasm of the Environmental Protection Agency for limiting electric utility emissions.

Similarly Obama has supported some new drilling for oil, but not in all the areas the industry would like to drill. He's in the middle of the road on this one, and no one is happy.

On nuclear power, Obama signaled a right turn and veered left. He came to office endorsing the nuclear option, including loan guarantees. But in a tip of the hat to Senate Majority Leader Harry Reid of Nevada, the president opposed the Yucca Mountain Nuclear Waste Repository, and undermined the case he was making for nuclear.

The mischief did not end there. Obama appointed Reid’s man, Gregory Jaczko, chairman of the Nuclear Regulatory Commission (NRC) to end the Yucca project and entomb, in effect, the $9 billion to $15 billion (depending on who is counting) in its abandoned tunnels. But because the government has longstanding legal commitments to take the waste, and has taken the money charged utilities (about $900 million a year) and treated it like tax revenue, the whole project has torn up the commission and landed it in court.

Jaczko, a former Reid aide, has riled the other four commissioners and the NRC staff to such an extent that the four went to the then White House chief of staff to complain about the chairman. An act of frustration totally unprecedented and deeply damaging to the credibility of the commission. Nobody resigned and a damaged regulatory body is now passing on the safety of the nation’s nuclear fleet. To all appearances, the chairman’s remit was to tear things up in the commission; that he has done.

In particular, the issue of licensing of Yucca Mountain has caused ructions. Jaczko has stopped the licensing in what the quasi-judicial Atomic Safety and Licensing Board in the case considers an illegal act. According to Marvin Fertel, president of the Nuclear Energy Institute, the industry wants the licensing to proceed if only to establish that Yucca was the right way to go and that it can stand the scrutiny that the NRC would give it in licensing. Fertel says that it's a marker for the future.

Opponents of Yucca, presumably including Jaczko, fear that a license would pave the way for the Yucca project to come back to life under a different administration. Did Obama, a lawyer, not know that political brute force in a regulatory agency is bound to throw it into disarray, and to leave its decisions to be impugned in court later? So why did he do it?

When it comes to alternative energy, Obama positively drove on to the left shoulder. The administration has promised wonders from wind, solar and advanced coal combustion. It has thrown money at these as though it were rice at a wedding. The most conspicuous of this mind-over-matter exercise was, of course, Solyndra. But the spending has been lavish, indeed promiscuous, and the bankruptcies are filling up court dockets and right-wing Web sites.

Yet, the gods have smiled on the Obama administration. A boom in natural gas, brought on by new technologies, and enhanced oil production, fathered by the same technological improvements, have brought oil imports down below 50 percent for the first time in 20 years. Electricity supply is holding.

Environmental organizations, having been cold-shouldered on climate change by the world in a time of economic upset, picked on the Keystone pipeline with fury. Particularly apoplectic about it has been the Natural Resources Defense Council, which hopes that by canceling the project, Canada would stop developing its oil sands.

No, says Canada. I spoke with Canadian Natural Resource Minister Joe Oliver shortly before Obama's first decision to delay the pipeline. Oliver said that if the decision weren't favorable, Canada would build a pipeline across the Rockies to British Columbia and export to China.

The latest setback has infuriated Prime Minister Stephen Harper's government, which now says it will no longer rely almost entirely on the U.S. market for its hydrocarbon sales.

So Obama’s latest swerve has angered our best ally and good neighbor, denied American workers thousands of jobs and will oblige refineries on the Gulf Coast to buy oil from unfriendly places on the world market.

He has also given the Republicans a handsome gift in an election year. Masterful! – For the Hearst-New York Times Syndicate