10 Democrats and 1 Independent joined the Republicans in voting for the cloture motion.
That isn’t precisely correct though. See DeFazio Blasts Republican Passage of Controversial Keystone XL Bill
My takeaway is that the GOP is bought. The public shouldn’t trust an entity like that in a position of public trust like Congress. The GOP is demonstrably untrustworthy on this topic, for example, I’ve claimed that diblit is not crude oil. Guess what? Congress agrees with me link
But then they’ll turn around and promote lines that even smart guys like Ravenman pick up and repeat about all the oil pipelines in this country and what does just one eensy beensy more matter?
That’s right, the law says diblit isn’t crude oil (for tax purposes), but these people elected to write our law claim otherwise to gather support for their pet project.
Few if any of those are dilbit pipelines, and none are on the scale of the XL.
I didn’t ask for any pity. I was simply responding to your grossly incorrect statement that the pipeline did not use imminent domain. I also wanted to correct your misleading perception that the landowners are “thrilled”. I got paid for the easement. It was fair market value. I accept that the pipeline is necessary infrastructure and I did not fight it. But the pipeline was, and continues to be, an inconvenience to me and I am not “thrilled”.
Keystone isn’t the worst offender, either. I have another local natural gas line on the other side of my property with an even noisier compressor and with sink holes and erosion all along it because they didn’t backfill correctly. I’ve tried negotiating with them about the noise, to no avail. But, again, it’s necessary infrastructure.
If I had more time, I would tell the story about the pipeline that was stolen. I think there’s still an ongoing legal battle over that one.
How is what I said not true? First, I am technically correct as the pipeline is undeniably being constructed and operated 100% with private funds. Second, even going down the route you have regarding the OPA and Oil Spill Liability Trust Fund, TransCanada would be held to pay for the cleanup costs under a spill as the responsible party. This amount is unlimited if they are shown to be negligent. The Trust Fund, is more of a fallback in the event that the responsible party goes bankrupt or can not be determined. Further, the Trust Fund is funded by industry not taxpayers. So, I guess how do you come to the conclusion that this somehow makes my statement that this project is privately financed not correct?
This isn’t true. It is possibly correct to say that dilbit isn’t considered crude oil for the calculation of this specific excise tax. Note that this doesn’t mean that TransCanada doesn’t contribute to the Trust Fund at all; there are other funding mechanisms besides this excise tax. It also doesn’t mean that even the product that is transported never had any of this tax assessed on it as the tax very well may have been paid on the diluent part of the product depending upon the makeup. Finally, this is somewhat of a fundamentally incorrect argument anyways since this excise tax doesn’t get paid by the pipeline operator of imported crude oil; it is paid by the operator of the refinery that purchases it. Therefore, if anyone is getting a tax break on this it is the person buying the product not TransCanada. Having said that, maybe this exemption should be eliminated if it in fact exists at all. I wouldn’t get all that worked up over it considering the responsible party of a spill is required to pay for the cleanup and this Fund is only an industry funded backstop as a secondary source of payment.
My real point on your statement is that this project isn’t some pet project of a politician. It’s certainly true that politicians on both sides of this issue have co-opted it as a pet project after the fact; however, this was just a normal pipeline project seeking approval under normally mundane circumstances until it became politicized and a proxy over the larger, and mostly unrelated, issue of global climate change.
That’s not the definition of fair market value. Fair market value is absolutely not determined based off of the price an unwilling seller would need to be convinced to sell.
I disagree that the taxpayers ROI is “infinite”; I agree that the project is built with private funds and not taxpayer dollars. The taxpayer is on the hook in the event of the spill, not TransCanada- at least, I’ve seen it claimed that the omnibus budget bill included a provision that limits TransCanada’s liability in the event of a spill, but I’m still looking for the text of that.
The impression that I got from the cite was that every pipeline operator pays this tax except TransCanada, which got a special exemption. Maybe I’m wrong- I’ll take another look at it.
I agree that the Fund isn’t designed to pay the whole cost of a cleanup but 1. it is pretty annoying if a specific company gets a break on paying into it just because of conservative ideology/lobbying/whatever it is and 2. I’m still trying to verify it, but it is claimed that TransCanada’s spill liability is limited and shifted to the taxpayer, similar to the treatment banks get with their risky investments. Add it up and America gets turned into Canada’s waste dump in exchange for nothing but the bill for the cleanup.
Well ok, it is more than a political pet project. It is also more than just another crude oil pipeline though- it is dilbit. I do strongly suspect the zeal of its political supporters comes from being owned by oil interests and not the merits of the project itself.
Besides that, while some people do seem to be making this issue a proxy for our GHG problem, I personally don’t look at it that way. I think the way to deal with the GHG problem is to transition to alternatives, not to shut out the lights and wait for the alternatives to appear. Demand destruction can shut down the development of oil and gas projects way more sensibly than killing projects.
I still think Canada is being irresponsible by insisting on piping dilbit. They should refine the sand and tar out of it and ship the crude and live with the complications of that, or else they should just build a pipe across their own territory for this quantity of dilbit.
I suspect Canada would rather be shipping crude or more highly refined product, the problem is the established refineries are in Eastern Canada or The US South. At a $1B per I can see why oil companies would see the sense in shipping raw product to existing facilities, however much I disagree with it.
I would find it absolutely shocking if there is any provision that specifically limits TransCanada’s liability in the event of a spill. It cannot possibly be the case that the taxpayer is on the hook for a spill. The way it works is that the responsible party is on the hook for cleanup and penalties. I believe there is a limitation for a non-negligent party based upon an EPA formula determination of a potential worst case spill calculation, but that in effect never comes into effect. It is unlimited in cases on negligence. And even if there was no negligence and it was capped at that worst case spill calculation number threshhold it would then fall to the industry funded Trust Fund. The only practical limitation for a company is if the dollar amount of cleanup is so big that it throws you into bankruptcy if you can’t pay it. Certainly a risk, but you do what you can to limit that risk. What can you do to limit it? Well, the government usually requires companies to carry insurance to cover the amount of the calculated worst case potential spill.
You are getting that impression because your cite is lying (about that and other things). I’m not at all accusing you of lying. It is clear that the operator of the refinery is responsible for the tax. Check out the following link.
Look at section 4611 (d)(1)
The party responsible is the operator of the refinery.
There is no way that a specific company (TransCanada) is getting any special break. That isn’t happening. Also to be clear, the fund isn’t designed to pay any of the cost of the cleanup. It is designed to be the backup if the Responsible Party can’t pay. The claim is that synthetic crude doesn’t fall under the definition of crude oil for the calculation of the excise tax that is a key part of the funding of the Trust Fund. There are other funding mechanisms such as penalties. However, like I said, the refiner is the party that pays for that tax. Money is obviously fungible though so if a refiner doesn’t have to pay that tax for any product they buy then they would likely pass that savings (or at least a percentage of it) on to the seller. Also, much of the diluent used with Canadian tar sands production is exported from the U.S. Much of that would be subject to the excise tax.
You’ve shared this view on numerous threads. I think you are placing special significance on this being dilbit instead of crude oil that is unwarranted. There is plenty of heavy asphaltic sour crude oil that is produced domestically (as well as internationally and imported) that would meet any normal definition of crude oil that is not functionally different in cleanup or corrosion or any other way you want to look at it from dilbit. It is all a petroleum hydrocarbon.
Politicians are picking this as an issue to focus on because they think it resonates with voters and donors. It’s really not that big of a deal though. Honestly the U.S. oil industry doesn’t care about this at all. I think the general opinion that most people have would be that: 1) there is no good reason to not approve it; 2) Obama is lying that this is just going through the normal approval processes, he is just indefinitely delaying making a decision; 3) the tar sands are getting produced with or without; 4) the railroads and Warren Buffett are making money that would otherwise go to a safer, cheaper, and more reliable pipeline company; 5) bringing that oil down to the gulf coast just further exacerbates our supply glut problem and will lead to worse pricing differentials; and 6) this is a net economic benefit to the U.S. but obviously not some major job creator.
In reading the IRS advice memorandum, the exemption that synthetic crude gets from paying this excise tax is based upon the 1980 House Ways & Means Committee’s presentation to CERCLA, which specifically excluded it from the definition of crude oil. Maybe it shouldn’t have been, but there’s your history. Therefore, the genesis of this exemption came under a Democratically controlled House, Senate, and Presidency if I am understanding it correctly.
If I had said “every landowner” was thrilled you’d have a point–I never said that.
I have yet to see where Keystone XL is being done largely through eminent domain, which was the claim being made. I’ll repeat–your land is crossed by Keystone, Keystone XL is not the same, it’s an additional pipeline that runs across a different geographic area and then links up with Keystone further south.
Compressor stations are unfortunately a necessity if you’re going to have a pipeline. While it’s true that in the very specific case of Keystone XL, the benefit to Americans is not directly obvious, for the vast majority of our pipeline infrastructure it’s being moved around for use in American factories or in American natural gas distribution companies (the guys who pump gas to your house to run your furnace, which heats 50% of American homes.)
I’m from the Plains, son. Flyover country. The Great American Desert. The sea of grass. The big empty.
We have water issues enough without this new contamination. We’re getting it run through our watersheds because 1) people here are just probably dumb enough to let it happen, and 2) we’re not a dense population center, so we’re not important–not even to our wayward sons who live on the East Coast now.
But it’s stupid. Kansas doesn’t need to be at risk for moving Albertan oil, when it can be a bigger energy producer than Alberta on the basis of wind and solar power. And spare me that twaddle about solar not working at night, because solar doesn’t have to mean no-storage photovoltaic cell installations.
The future is renewables, period. It’s the fossil fuel industry that’s chasing diminishing returns, and at some point we have to stop drinking the poison for the sake of their delusions of continued relevance.
fine, run the pipeline through Ohio. Plenty of water.
“We” need this stuff? Who’s this “we”? I certainly don’t need for a Canadian company to be able to ship their product overseas easily. I doubt very many other Americans need it, either.
Then let me revise my position to: it is pretty annoying if a specific company gets a break on paying into it just because of political ideology/lobbying/whatever it is.
Still, today’s world is different from that of 1980. I don’t think our leaders grasped then what dilbit would come to mean. I can accept the way this rule was passed. I think today’s democrats in Congress understand that this rule is dated, and tried to update it in the budget bill to reflect the times. The pubbies blocked that in a somewhat two-faced fashion. The pubbies have a pattern of behaving in such a two-faced fashion, though admittedly no politician is entirely trustworthy. Still, to me, the GOP seems the shadier party, and happens to be the biggest proponent of the XL pipeline. I suspect they are under the influence of foreign monetary persuasion.
It isn’t anyone’s feelings that decides these things. For example, it would seem rather shocking if the banks were, by law, to be bailed out by the taxpayers in case their risky swap investments failed to produce a profit, but that is in fact what our laws have been manouvered to do.
Same with the XL pipeline. It is at least claimed on the floor of the Congress that the American taxpayer is on the hook for the costs of the cleanup of an XL spill, though the specific legal text that proves it continues to elude me.
I disagree. The BP Deepwater Horizon disaster was an unprecedented catastrophe. BP dumped 3.2 million barrels of oil into a semi-tropical ocean gulf. The judge limited the damages to $13.7 billion. cite
It has been noted in this thread that the Kalamazoo River dilbit spill cleanup has cost $1 billion to date, is not complete, and involved all of 20,000 barrels of dilbit. Can you not grasp the potential destructive power of a major dilbit spill vs. a conventional crude oil spill?
Well, I think your position is still incorrect. How is this a break for a specific company, TransCanada, if it instead applies to a broad category of products that would apply to any company? Further, I’ve already shown that it wouldn’t apply to a pipeline company anyways no matter what the product is; it is a tax paid by refiners of which TransCanada isn’t one.
This misses the bigger point. This shouldn’t be a congressional action at all. This is a State Department issue. While I don’t agree with the Republican approach, and also don’t agree that it is a big enough issue to even mess with, the Republican measure cannot be looked at in a vacuum. It directly relates to the State Department’s indefinite stall on making a decision.
All sorts of bullshit is claimed by congressmen when they are spouting their talking points. That doesn’t mean anything. Here’s the text of the bill. There’s nothing in it regarding a limitation of liability.
Are you really surprised that DeFazio is lying? He also says this in your same link.
[QUOTE=DeFazio]
I do find it particularly ironic that today, on the same day that the House read the Constitution, Republicans passed a bill that would give a foreign corporation the right to take private property from American citizens. I’m not aware of any other time, that Congress has voted to give a foreign entity the right to take the private property of a U.S. citizen
[/QUOTE]
The bill is only one page long. It specifically says this.
[QUOTE=H.R. 3]
Nothing in this Act alters any Federal, State, or local process or condition in effect on the date of enactment of this Act that is necessary to secure access from an owner of private property to construct the pipeline and cross-border facilities described in subsection (a).
[/QUOTE]
It’s all bullshit talking points. I don’t care if the thing gets built or not, but if you can’t see that it is the President that is causing this all then you are purposefully making excuses for him. This thing is a pipeline proposed in 2008. How can it possibly take this long to review an application. Either approve it or deny it, but don’t pretend that this is just a normal review process.
You’re not understanding the information that you are reading. The judge didn’t limit BP’s damages in the Macondo spill to $13.7 billion. They set the volume of the spill at 3.2 million barrels which would have the effect of limiting the fine to $13.7 billion. The volume, as I’m sure anyone can appreciate, is a difficult to measure number. BP said it was 2.4 million barrels, the government said it was 4.2 million, all sorts of experts had differing numbers. The fine is dependent upon the volume, so that’s why the judge’s volume ruling sets a limit on the fine. BP’s actual costs, of course, include way more than just a fine. Obviously clean up costs plus settlements with individuals affected. They have paid 100% of the clean up costs, which includes reimbursing other entities (such as Federal spill response entities) for their costs.
Now, I get your point that this river spill costs far more on a per barrel basis, but a big part of that is easily explainable or not applicable. It helps to have some general spill cleanup thoughts in mind. First, generally a spill in the water is typically more expensive than a spill on land. Second, generally a spill in open water should be less expensive than a spill in an area with vegetation. Third, generally a spill in the deep water is more expensive than a spill in shallow water. Fourth, generally a spill in a populated or developed area is going to be more expensive than a remote area. I say all this to say that you are comparing apples to oranges. You can’t easily compare an out of control blowout in the deepwater gulf of Mexico with a spill in a river with development and vegetation all around and then just make a per barrel cost comparison and say that the difference is one was dilbit and one was light sweet crude. There were tons of variables that have nothing to do with the quality of the hydocarbon. Further, you then can’t extrapolate anything from that to then apply to what would be a spill on land (hypothetical Keystone XL future spill). It’s just a faulty process.
You make it sound like this pipeline is a constraining factor in shipping dilbit through the US. As long as the price of oil is high enough, the dilbit WILL be shipped. Of all the methods of shipping dilbit, pipelines are the safest and most efficient way to do so.
The Keystone pipeline is already up and running, it carries 700,000 bbl/day from Alberta to refineries in Illinois and Texas. The only thing that Keystone XL does that Keystone does not already do is make a pitstop at the Bakken Shale wells in Montana. How much more dilbit do you think we will be pumping because of Keystone XL?
AFAICT, Keystone XL will largely be diverting shale oil from states neighboring Wyoming and South Dakota to refineries in Illinois that send their refined products to the NorthEast. The Keystone XL does not connect Alberta to the Gulf cost. It connects Alberta and the Northern Plains states (Bakken shale) with Steele City Nebraska and from there it can go to the gulf or to Illinois.
Except it’s moving through the pipeline that requires the added chemicals that make dilbit. Shipment by rail requires the addition of much less (if any) of the toxic and volatile viscosity reducers.