It's happening again. Environmentalists are determined to block the construction of oil pipelines like the Keystone XL from Canada. Thirty-nine environmental groups, including the Natural Resources Defense Council and the Conservation Law Foundation, recently sent a joint letter to Secretary of State Hillary Clinton opposing the Keystone project. They disregard the economic consequences of their actions at a time when unemployment in this country is hovering near or in the double digit range. Tens of thousands of jobs - including many at steel companies in Ohio - are at risk.
The Keystone XL pipeline would give the U.S. greater access to Canada's vast oil-sands formations which hold an estimated 174 billion barrels of oil, second only to Saudi Arabia's reserves. Building the multi-billion-dollar pipeline - which would extend 1,700 miles from Alberta to the Gulf of Mexico - would provide well-paid construction and manufacturing jobs over the next several years.
Pipeline construction is especially important in Ohio because our steel companies historically have produced a large share of the nation's oil and natural gas pipelines. Currently U.S. Steel Corp. is expanding and upgrading its plant in Lorain, Ohio, which makes tubular steel. Timken Co. is also upgrading its plants in Canton. And Vallourec & Mannesmann Holdings Inc., one of the world's largest makers of steel tubes, is building a new steel plant in Youngstown with the goal of supplying seamless steel tubes used in drilling for oil and gas in formations like the Utica and Marcellus shales in Ohio and other parts of the Appalachian basin.
More steel industry jobs can help pull our economy out of its slump, especially here in Ohio. One recently-completed study prepared for TransCanada by the Perryman Group forecasts that the Keystone pipeline's construction and operation, and continued oil-sands development, would ultimately create in excess of 300,000 jobs in the U.S.
Nonetheless, environmental groups are battling to block construction of the pipeline, largely on grounds that it would encourage the production and use of Canadian oil sands. Groups such as the Natural Resources Defense Council and the Sierra Club maintain that oil sands have a much higher carbon content than conventional crude oil and equate its use to coal burning in electricity production. But crude obtained from Canada's oil sands is a reliable source of oil and isn't any "dirtier" than California or Middle East heavy crude, according to Cambridge Energy Research Associates.
U.S. imports of crude oil are currently running at about 9 million barrels a day, costing our country upwards of $1 billion daily. When the Keystone pipeline is fully operating, Canadian oil shipped to the U.S. would double, reaching a projected 5 million barrels a day by 2020, up from 2.5 million barrels today. Within a decade, Canada would account for at least 40 percent of U.S. oil imports, with much of the money recycled to pay for U.S. goods and services.
On the other hand, if the pipeline isn't built, the U.S. would need to replace much of that oil with imports from overseas. Since the Middle East accounts for most of the world's oil reserves, our security of supply would be lessened.
It's no secret that China covets Canadian oil. China's demand for oil is so great that it is willing to finance construction of a pipeline from Alberta to Canada's West Coast. The U.S. should not allow that to happen. Canadian oil can make an enormous difference in bolstering our nation's energy security.
People are understandably concerned about ruptures of aging pipelines like the one that occurred recently at the Yellowstone River in Montana. But newer pipelines are benefiting from steady improvements in pipeline technology. The Keystone pipeline will use a number of technological breakthroughs in pipeline construction and monitoring that will reduce safety risks. We should also keep in mind that moving oil by pipeline is considerably safer than shipping oil from overseas by supertanker.
President Obama needs to encourage the environmental groups, the pipeline companies, and the petroleum industry to work cooperatively for the good of the American people. Ultimately, he should approve construction of the Keystone XL pipeline. If America is to have a reliable and affordable supply of oil, modern pipelines like Keystone XL should be built. Since oil is critical to the functioning of a modern economy, there are few more important tasks than availing ourselves of Canada's vast oil resources.
Dr. Robert W. Chase is chair and professor of the Department of Petroleum Engineering and Geology at Marietta College, 215 Fifth St., Marietta.
