By Eyeview

Empty pipelines spill no oil

Jun 7, 2018 | 5:00 AM

THE KINDER MORGAN pipeline should be built for the same reason as the pyramids – as a national monument.

The pyramids employed workers but served no practical purpose other than a grand burial site for the pharaohs. The humble graves of the workers would have served the pharaohs just as well.

Construction of the People’s pipeline will employ well-paid union workers. It’s supposed to carry crude oil to Asia but that market doesn’t exist. Therefore, it will serve as a wonderful monument to the “National Interest.”

The pipeline should be built because it serves political interests. Premier Notley’s hopes to be re-elected depend on completion of the pipeline. In her letter to Maclean’s, she said:

“And together, we are building this pipeline — with B.C. workers, using steel made in Saskatchewan, from ore mined in Quebec. Now, it’s time to pick those tools back up, folks. We’ve got a pipeline to build.”

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While I’m less optimistic about the future of fossil fuels than Notley, I would rather see her re-elected than Jason Kenney, leader of United Conservative party of Alberta. A progressive premier with delusions about the future of oil sands is better than a retrograde one with similar delusions.

The People’s pipeline will bring the feuding NDP family members back into the fold where they can return to civility. This spat has been an embarrassment for the NDP and for new leader Jagmeet Singh. Until recently, the NDP was one big happy family; unlike other parties, there is only one party provincially and federally.

The pipeline should be built to strengthen our federation. Prime Minister Trudeau is correct in asserting the nation’s right to move goods to market over the objections of provinces. One province should not have the ability to stop the national transport of commodities.

While the symbolism of the pipeline is strong, the financial rationale for the pipeline hinges on flawed logic. Finance Minister Morneau claims the pipeline is required to get oil to “tidewater” so it can be sold at higher prices than in the U.S. Economist Robyn Allan is not so sure:

“The facts don’t support the argument. The economics aren’t there. This project is financially compromised and not commercially viable (Globe and Mail, June 2, 2018).”

The fantasy is that Asia will pay more for the goop than it could be sold for in North America. However, in recent years, heavy crude has consistently sold for significantly less in Asia than the U.S. Refineries in Texas, Louisiana and Mississippi are ready; they have been re-engineered to process the heavy crude of the oil sands.

Just one per cent of the oil in the existing pipeline flows to Asia. Another pipeline won’t change that fraction. Most oil goes to California and Washington State where it is refined and sold back to Canada as expensive automotive fuel.

The financial reality is that TransCanada’s Keystone XL pipeline to the U.S. is a better bet in getting crude oil to market. The off again/on again pipeline is breathing new life under the Trump administration.

The pipeline should be built and remain empty. Everyone will be happy, workers and environmentalists alike.