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Oil from Keystone pipeline could end up exported

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By McClatchy Newspapers
Sunday, April 28, 2013, 5:21 p.m.
 

WASHINGTON — Whether the proposed Keystone XL pipeline would boost American energy independence is a key part of the debate over the pipeline, the biggest environmental battle in recent history. Keystone promoters say the $7 billion project is vital for the nation, but there are signs much of the oil coming through it would be exported.

The United States increasingly exports refined petroleum products such as diesel, heating fuel and gasoline from the same Gulf Coast refineries where Keystone oil would be headed.

There is no reason oil from Keystone would be treated differently, according to energy analysts.

Disputes rage over how much is exported. A recent State Department analysis of Keystone says less than half of the Gulf Coast's refined products go into the U.S. market.

The United States is on the path to energy security and is forecast to become the world's leading oil producer in just four years, a different world from its past desperation to secure stable energy.

But Canadian Natural Resources Minister Joe Oliver said last week that the United States still will need foreign oil in the coming decades, and it is better if it comes from an ally. The 1,700-mile Keystone pipeline would go from the Alberta oil sands in Canada to the U.S. refineries on the gulf.

Oliver said the oil would be used in America and that Keystone is not an export pipeline.

Oil Change International, a group fighting the Keystone pipeline, argues that is clearly not true. The group used census and U.S. energy data to figure out how much is now exported from the Texas refineries expected to handle the majority of Keystone oil.

They found 60 percent of the finished gasoline produced last year in those refineries was exported.

“Keystone XL proponents are saying this is about energy independence, and obviously it's not,” Oil Change International executive director Steve Kretzmann said.

The American Fuel and Petrochemical Manufacturers trade group responded that export figures are being misused.

Charles Drevna, president of the group, said the figures are nowhere near 60 percent when all gasoline produced to blend with ethanol is accounted.

Drevna asserted that the real Gulf Coast refinery export figures are only “probably around 11 or 12 percent.” That figure will remain the same after Keystone is built, he said.

Keystone is not for exports, he said.

“Anyone who believes that either has to understand this industry better or they are just trying to mislead the public and Congress,” Drevna said.

Some influential members of Congress, including Senate Energy and Natural Resources Committee Chairman Ron Wyden, question how much American consumers would benefit from Keystone.

Wyden, D-Ore., said the State Department needs to deal with the export issue before approving the pipeline.

“The State Department needs to explain how it is in America's national and economic interests to facilitate Keystone XL's completion, especially if the pipeline is simply a conduit for oil and refined products to go elsewhere,” Wyden wrote in a recent email.

Other members of Congress say the United States needs the pipeline.

“Keystone XL is good for American jobs, good for our economy and good for national security,” said Rep. Doc Hastings, R-Wash., chairman of the House Natural Resources Committee.

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