Alberta Pipeline

“A very definite conclusion” on oil sands crude and pipelines

The president’s remarks from Tuesday garnered a lot of attention because of their focus on climate change and the Keystone XL pipeline.

Let’s hope they don’t overshadow a significant development that emerged the same day: A scientific study that provides strong support for the importance and safety of Keystone XL.

The publication was a long-awaited report from the National Research Council (NRC), which looked into the effects of oil sands crude (a.k.a. diluted bitumen, or dilbit) on pipelines. Critics have long charged that dilbit – particularly the crude produced from Canada’s oil sands region – is somehow different from conventional crudes, increasing the likelihood of corrosion, ruptures and spills. It has been one of the chief arguments against going forward with Keystone XL.

The NRC report makes clear these claims are baseless.

“Diluted bitumen has no greater likelihood of accidental pipeline release than other crude oils,” according to the NRC. “The committee that wrote the report found that diluted bitumen has physical and chemical properties within the range of other crude oils and that no aspect of its transportation by pipeline would make it more likely than other crude oils to cause an accidental release.”

That sounds a lot like what a researcher at Canada’s leading national research laboratory told the press last year about his own study into the matter: “We did not see any difference whatsoever” between crude from oil sands and other crudes.

The NRC report also confirms what the oil and natural gas industry has discovered in our years working in the oil sands. We have studied this issue extensively. After all, we have an interest in making sure our pipelines last long, operate safely, and are not threatened by the products they carry to markets and consumers.

Still, it’s encouraging to see yet another independent group of experts confirm what we and the rest of the industry have been saying.

The comprehensive nature of the National Research Council’s study should put an end to the flawed argument about oil sands corrosivity. As an official with the Canadian Association of Petroleum Producers told Bloomberg News, “It does provide a very definitive conclusion.”

Of course, the real conclusion will come when the president approves Keystone XL and the project finally gets built. The NRC report gives President Obama one more reason to do so.


8 Comments

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  1. ted peterson says:

    Ken, thanks for the update on this. Given obama’s statements on keystone xl and “carbon pollution”, it would seem this is at least as critical a consideration. Your thoughts/perspective?

    • Ken Cohen says:

      Thanks, Ted. I’ll just point out that the State Department, which spent several years studying the ramifications of building the pipeline, has twice determined there would be no significant environmental impacts with doing so. With regard to carbon profile, I’ll note that all of Canada accounts for only 2 percent of global greenhouse gas emissions and oil sands specifically make up only 0.1 percent of the total. They are no more GHG-intensive than many other heavy crudes, like those from Venezuela, Mexico, West Africa or parts of California. It’s certainly appropriate to question what type of impact a large infrastructure project may have on greenhouse gas emissions. But the fact is we have done that with Keystone XL and we know the answer, which is that building the pipeline will ultimately produce fewer emissions than the chief alternatives: shipping oil sands crude to U.S. markets via trains and trucks, or to Asia via pipeline to Canada’s west coast and then on tanker ships.

      • ted peterson says:

        Canadian oil sands are no more carbon intensive than other heavy crudes but only on a per unit of energy basis. However, you seem to be implying that if Keystone XL were to not be built, the same quantity would be transported via rail or tanker. This, as I’m sure Exxon recognizes, is an unrealistic expectation. Using these transport methods would unarguably increase transportation costs (I’ve seen estimates of tripled cost per barrel for rail vs. pipeline, ignoring capacity constraints) which would obviously reduce the amount supplied. Of course, this doesn’t answer the question of which would be more/most carbon intensive (on a lifecycle basis), but it seems that these important factors are missing from your analysis.

        I’m also skeptical of the practicality of diverting large quantities of Canadian bitumen to Asia due to the limited capacity for refining heavy oils in the region. For instance, China can only process a few hundred thousand barrels per day – far from the several million produced daily. Sure, refining could be dispersed between countries, but this would only add to the emissions profile and cost.

  2. Julie Range says:

    I think the issue isn’t the tar sands crude is worse than other crude, the issue is that it is worse than processed fuels, and it is being piped a long distance to a processing facility. While it has no greater likelihood compared to other crude oils, the likelihood of leaks still exists with corrosive crude over a long distance. But the big issue is that tar sands oil has a much greater carbon footprint, and for a country that may soon regulate carbon, an easy way to not increase carbon emissions is to just not accept a source of ‘dirty’ fuel. Have you noticed the direction the country is headed with coal?

  3. Raj Kapoor says:

    Remember when oil company and its executives were being helped by one government employees while snorting drugs and even not paying royalties? Getting a research PI or an institute to give clear slip of health on corrosion and or rupture means nothing. Will they have same friction and will have same friction loss when travelling 3000 miles, will the maximum pressure in pipelines and valves will be same as now or will they use same horse power? Question is: what are facts? why not have tests run on three miles of slurry pipeline at Colorado School of Mines or at Tulsa University? Why not publish all factors for Bitil and let scientist give you results? Does ratio of diluted Bitumen and its settlement changes with change in temperature, when pipeline will travel from CANADA to GULF, how much and how many places the temperature will change and thus sand will settle in pipe? Will we be able to maintain same velocity, if so, how will power used per gallon mile will change? Remember a company was asked to seal BP well with cement and they knew cement will seal it, but they used old rubber product thus increasing number of days spill continued, then they deleted all the records and now have accepted the crime? What will not oil companies do to get permits or impress STATES or PEOPLE? Be careful, please, and someone please teach them honesty, integrity and ethics. They earn so much, make so much money, why… read more »

    …do they have to lie? God Bless America.

  4. Raj Kapoor says:

    If it is so good, why not Canada process it in their back yard or near production facilities and ship it via pipeline or road the finished product? TRUTH COMES UP, right?

  5. Gael Murphy says:

    Well, if Exxon Mobile says it’s safe, it must be true! They are just as honest as BP. Don’t worry, be Happy!
    \

  6. ted peterson says:

    Ken, thanks for the update on this. Given obama’s statements on keystone xl and “carbon pollution”, it would seem this is at least as critical a consideration. Your thoughts/perspective?

    • Ken Cohen says:

      Thanks, Ted. I’ll just point out that the State Department, which spent several years studying the ramifications of building the pipeline, has twice determined there would be no significant environmental impacts with doing so. With regard to carbon profile, I’ll note that all of Canada accounts for only 2 percent of global greenhouse gas emissions and oil sands specifically make up only 0.1 percent of the total. They are no more GHG-intensive than many other heavy crudes, like those from Venezuela, Mexico, West Africa or parts of California. It’s certainly appropriate to question what type of impact a large infrastructure project may have on greenhouse gas emissions. But the fact is we have done that with Keystone XL and we know the answer, which is that building the pipeline will ultimately produce fewer emissions than the chief alternatives: shipping oil sands crude to U.S. markets via trains and trucks, or to Asia via pipeline to Canada’s west coast and then on tanker ships.

      • ted peterson says:

        Canadian oil sands are no more carbon intensive than other heavy crudes but only on a per unit of energy basis. However, you seem to be implying that if Keystone XL were to not be built, the same quantity would be transported via rail or tanker. This, as I’m sure Exxon recognizes, is an unrealistic expectation. Using these transport methods would unarguably increase transportation costs (I’ve seen estimates of tripled cost per barrel for rail vs. pipeline, ignoring capacity constraints) which would obviously reduce the amount supplied. Of course, this doesn’t answer the question of which would be more/most carbon intensive (on a lifecycle basis), but it seems that these important factors are missing from your analysis.

        I’m also skeptical of the practicality of diverting large quantities of Canadian bitumen to Asia due to the limited capacity for refining heavy oils in the region. For instance, China can only process a few hundred thousand barrels per day – far from the several million produced daily. Sure, refining could be dispersed between countries, but this would only add to the emissions profile and cost.

  7. Julie Range says:

    I think the issue isn’t the tar sands crude is worse than other crude, the issue is that it is worse than processed fuels, and it is being piped a long distance to a processing facility. While it has no greater likelihood compared to other crude oils, the likelihood of leaks still exists with corrosive crude over a long distance. But the big issue is that tar sands oil has a much greater carbon footprint, and for a country that may soon regulate carbon, an easy way to not increase carbon emissions is to just not accept a source of ‘dirty’ fuel. Have you noticed the direction the country is headed with coal?