This is the second of a four-part collaborative series by StateImpact Texas and Oklahoma on the economic and environmental impact of the Keystone XL pipeline. You can read part one of our series on the Keystone XL pipeline here.
The United States loves crude from Canada. No other single foreign country is now providing more imported oil to the U.S. But with the proposed Keystone XL pipeline has come the claim that the crude from north of the border is uniquely risky.
Last June in Washington, the House Energy and Power Subcommittee questioned a federal regulator about whether pipelines in the United States were built to handle the kind of crude coming from Canada, diluted bitumen.
“Were your regulations developed with the properties of diluted bitumen in mind?” asked Rep. Henry Waxman, a Democrat from California.
“I don’t believe it was a part of the equation, no,” responded Cynthia Quarterman, head of the U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration.
After hearing from critics of the pipeline, Waxman said he was concerned “that the industry is changing but the safety regulations are not keeping up with the changes.That could be a recipe for disaster down the road.”
When it comes to interstate pipelines, the federal government has the lead on setting and enforcing safety regulations. The Texas Railroad Commission’s Oil and Gas Division would have jurisdiction only if a pipeline ruptured and created a threat to the Texas environment.
Diluted bitumen, nicknamed dilbit, comes from oil contained in massive deposits of sand. Steam is used to extract the oil from the sand and the resulting crude is partially processed before it’s piped to refineries.
Critics say dilbit is more corrosive than conventional crude and can “lead to weakening of pipelines”.
“Bitumen blends are more acidic, thick and sulfuric than conventional crude oil” and “contain significantly higher quantities of abrasive quartz sand particles” said a report by a coalition of critics including the Sierra Club and the Natural Resources Defense Council.
When asked to respond, one of the first things people in the Canadian pipeline industry point out is that while the Keystone XL Pipeline project has become a lightning rod for criticism, the dilbit crude it would carry has already been flowing into the United States for years.
“This isn’t new. Enbridge has been transporting these types of products since 1999 in our pipelines,” Denise Hamsher told StateImpact Texas.
Hamsher is head of planning for Enbridge’s $12 billion in new pipeline projects. Enbridge is a competitor of TransCanada, the company behind the Keystone XL project.
“There have been no incidents of pipelines carrying Canadian crude (that resulted) from internal corrosion despite more than two decades of transporting crude oil,” said Hamsher.
That’s not to say there have been any spills. In July 2010, one of Enbridge’s 30-inch pipelines ruptured in southern Michigan, spewing hundreds of thousands of gallons of Canadian crude into a creek that flowed to the Kalamazoo River. While an official cause won’t come from government investigators until this summer, Enbridge said internal corrosion had nothing to do with it.
“All you’d have to do is look at the picture of the pipe,” said Hamsher. “There’s no reason or evidence that the leak was at all related to internal corrosion.”
There have also been leaks involving TransCanada’s existing Keystone Pipeline (the Keystone XL is an expansion project). Since it began operating in 2010, the Keystone line—from Alberta to Illinois and Oklahoma—has had 14 “spills” according to the U.S. State Department’s report on the potential environmental impact of the XL project.
None of the 14 leaks were because of corrosion of the actual pipeline. Instead, the State Department report said they all involved “fittings and seals at pump or valve stations”. The report said all but three of the spills were of less than 100 gallons. The biggest was in North Dakota where 21,000 gallons of crude escaped from a faulty fitting. Most of the oil stayed on the pump station site according to the report. The State Department projected that the proposed Keystone XL pipeline would have about one spill a year of over 2,100 gallons.
TransCanada spokesperson Jim Prescott said the State Department’s environmental impact statement confirms what the company has contended.
“Don’t take our word for it. Look at the final environmental impact statement which was the result of 41 months of study of this project and reach the conclusion that this oil is no different than the oil that is already in the pipeline infrastructure of the United States,” Prescott told StateImpact Texas.
So corrosion is no problem for such pipelines? To the contrary, it’s one of the leading causes of pipeline failure according to Oliver Moghissi. He’s the past president of NACE International, an association of corrosion engineers.
“Corrosion tends to be number two. Number one is usually outside force damage, usually by an excavator,” Moghissi told StateImpact Texas.
Moghissi works for DNV, a risk management company that did a forensic examination of the blowout preventer from the Deepwater Horizon disaster.
But while Moghissi said corrosion is a serious threat to crude oil pipelines, he contends there’s nothing in Canadian crude that makes it any more risky than conventional crude to the long-term reliability of a pipeline.
“I don’t agree that it presents a unique kind of corrosion threat,” said Moghissi.
Yet, the issue is hardly resolved in the eyes of at least some in Congress. Under the Pipeline Safety, Regulatory Certainty and Jobs Creation Act of 2011, Congress mandated a study to determine if there’s “any increased risk” of transporting diluted bitumen crude. Last month, a contract was awarded to the National Academy of Sciences which is expected to release the findings of its investigation to Congress by July 2013.