Oil, Gas, Pipelines, Trains and Addiction

Posted by on July 15, 2013
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We are addicts, addicts for energy.  We don’t care where the energy comes from, so long as it’s not from our own muscles.  Put in a battery, plug it in, point it to the sun or the wind, or, better yet, head to your friendly gas station with a container and fill ‘er up.  We use the energy to do work, to operate our homes and other buildings, to travel from place to place, but increasingly we use the energy to play.  I thoroughly approve of play, but play that makes do with imagination, role-playing, and improvisation, or some version of a bat and a ball seems not to rank so high as it once did.  Now toys have to have batteries, motors or both, or they are not real toys.  And the more they can replace the need for imagination, by being automated, able to talk back to you, so much the better.  This is true for toys for children, and it’s definitely true for toys for grown-ups.  A Lamborghini is not a mode of transportation, even if it does whiz you from place to place while its navigational and entertainment module talks to you in a sexy voice of your choosing.

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Definitely a toy – McLaren’s Lamborghini Aventador.

Our addiction is aided and abetted by the fossil fuel industry, a large industry that is quite willing to use its strength to encourage governments to look favorably on its activities, while encouraging us to use more and ever more of what it produces.  It also spends prodigious amounts to convince us that it is environmentally responsible.  All those offshore rigs built to provide jungle gyms for seals and porpoises.  All those refineries, scrupulously clean, bathed in clear bluish light under sunny skies with just a couple of wispy clouds, and nary a hint of the smell of hydrocarbons.  The pictures of them almost smell clean.  All those smiling, happy drill rig operators, working hard to bring energy to you.  And all those open pit mines full of immensely large trucks and bulldozers – the subliminal message here is that it takes real men to work in the energy sector, no room for wussy environmentalists.

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While we do get energy from sources beyond fossil fuels, they contribute about 75% of the total, largely because they are convenient to store, to transport and to use, and they pack a lot of energy into each gram or liter of product.  The fossil fuel industry, including seven of the 10 largest corporations in the world, is a major economic player, and we need to remember that, like all effective economic players, it plays to win, not to make our lives better.

Yes, the accident at Lac Mégantic on 6th July was tragic.  I cannot begin to imagine what it must be like when the downtown core of a tiny town is obliterated in an instant along with 50 lives.  But it is already being used in the struggle to build more pipelines.  And the struggle to build pipelines is a struggle for hearts and minds, and regulatory approvals, which uses our addiction.  Let’s be realistic.  While details of what happened last week are not yet clear, that train rolled down the track because a) it was unattended, b) it was on a slope, and c) its brakes failed, were not applied, or were tampered with either accidentally or deliberately.  The law is apparently lax enough to permit companies to leave trains idling (so the air brakes remain set) and unattended, while the operator goes to a hotel for a good night’s sleep, even though the train is on a slope and has hazardous cargo on board.  I suppose the Harper government view will be that market forces should ensure safe operation – no need for tougher regulations.  Seems to me there is some work to do here, but not very demanding work – put regulations in place that prevent trains carrying hazardous material being parked unattended on hills, with brakes that are not applied, that fail, or that get released by unknown persons.

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Pipe for the Keystone XL pipeline, CP photo.

The important thing to understand is that correcting the situation that led to this accident is simple, but that even if corrective action is not taken, nothing about this accident has anything to do with pipelines.  Pipelines can fail and spill their contents, and the risk of a pipeline failing has not been altered by this train accident, nor by any corrective action taken in future.  Diana Furchtgott-Roth, who has written a book titled, wait for it, “Pipelines are safest for transportation of oil and gas,” got an op-ed piece into the Globe and Mail on 7th July, just one day after the accident, in which she argued that the accident proved pipelines were the safest transport available.  It did nothing of the sort.  It was just one train accident; horrific yes, proof no.  The statistics do show that there are more accidents per barrel shipped by train than by pipeline, but they showed this before the accident.  What the accident does is allow Ms. Furchtgott-Roth to prey on our emotions.  Her article is also disingenuous in that it focuses on lives lost through train and pipeline accidents, when the real concern is that a ruptured pipeline can cause immense environmental damage.  When a train derails, some or perhaps all of the tank cars rupture and the oil spills out.  Then it stops because there is no more oil.  When a pipeline leaks, oil can be spilling for days or weeks before any of those smiling, hard-working oil sector employees notice it.  And a whole lot more oil leaks out.  The Lac Mégantic accident has not changed the degree of risk in using pipelines one iota.

Why should we expect logic?  This is a propaganda war by those who want more pipelines against those who argue we have enough already.  Given that Canada has some 825,000 km of pipelines and the US some 4.2 million km, why is there a need to keep building them?  Because the fossil fuel industry wants to get oil and gas from wells to refineries ever more quickly, because they want to produce faster and faster.  And why do they want to do this?  Because they want to grow our addiction.  And why are they striving to grow our addiction?  Because they know, if we do not, that time is running out for the fossil fuel industry, that humanity is going to stop using coal, oil and gas long before we run out of known, accessible reserves.  For the fossil fuel industry, it’s all about the bottom line, about maximizing profits while they can, about using our addiction to convince us that they know best.

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Shale oil drilling rig in Bakken field.  Photo, The Energy Collective.

At the present time, there is a glut of oil and gas supplies in North America.  This glut resulted from the implementation of fracking technology to free up shale gas and oil across the US.  While environmentalists have raised concerns about pollution of aquifers, regulation of the fracking industry has not been noticeably tightened, probably because the industry has been able to use our addiction to turn “energy independence” into a major strategic goal for the US, a goal any government would find difficult to challenge.  Under cover of energy independence, fracking activity has surged – it would be un-American to oppose this.  The ramp-up in production has taxed pipeline capacity, created a surge in rail transport of oil and gas, and lowered the price of North American crude.

The West Texas International (WTI) benchmark price has been falling since 2011 because of this growing glut.  As Geoffrey Styles explains in a recent post in Energy Trends Insider, the WTI price is set as product is bought and sold at the giant oil tank farms in Cushing, Oklahoma, and the surge in production had built up inventories at Cushing.  Now, given intensive efforts to reverse some pipelines, build new ones, and step up use of rail and truck transport, those inventories are beginning to fall, and the WTI price is expected to climb back towards parity with Brent, the major international benchmark price.  (Styles’ article focuses on the clever way in which the depressed WTI price has been used by the energy sector to generate extra profit rather than lead to lower prices for gasoline – ah yes, all those oil companies working for us the consumers.)

The glut, and the resulting low prices for crude have curtailed growth in the Alberta tar sands, and the abundance of other oil may mean that tar sands product will continue to sell at a discount for some time to come.  From an environmental perspective this slow-down in growth of the tar sands program is very good news, and so long as there continues to be resistance to new pipelines, perhaps now coupled with resistance to, or increased costs imposed on, rail transport, this brake on growth will continue to have some effect.

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Not necessarily the best thing since sliced bread.  Photo © David Dodge, Pembina

And so the saga continues.  Canadian producers want desperately to move ever greater quantities of crude oil away from Alberta, towards refineries anywhere, so they can ramp up production and make more money before the entire system comes to a halt and we get weaned off fossil fuels.  Canadian governments want to keep the fossil fuel industry happy, because they have apparently been unable to envision an economy that is not based on the simplistic digging up of raw resources and selling them overseas.  Harper government Ministers become ever more strident as they argue for more pipelines, yet remain strangely silent about the probable need to regulate transportation of hazardous goods more stringently.  And everything gets reduced to the simple equation: oil + gas = energy + jobs + government revenue, and the corollary: MORE oil + gas = MORE energy + jobs + government revenue.

Friday’s Globe and Mail carried an excellent report of a letter sent in April from Gary Doer, Canada’s Ambassador to the USA, to John Kerry, Secretary of State.  The content of the letter had been released by the US government the day before, as part of its public consultation process for the Keystone XL pipeline.  The article enumerated the succession of half-truths and distortions used in the letter advocating for approval of the pipeline.  I’ve mentioned many of these same government talking points in previous posts on the subject: Canada is half-way toward meeting our emissions reduction target, tar sands production is going to grow whether or not new pipelines get built, Canada is planning new regulations on CO2 emissions by the oil and gas sector, and Canada has a transparent environmental monitoring program in place in the tar sands.  It’s a pity our governmental representatives have to behave this way.  Fortunately there are people like Andrew Nikiforuk, David Suzuki, or most recently Robert Bateman, who can argue eloquently in favor of the environment, a more sane economy, and the need to preserve and build our quality of life.  Let’s all remember that enough sunlight arrives on this planet every day to power the global economy 14,000 times over.

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