Oil industry: Response to leaks boosts case for pipeline

The Obama administration’s swift response to leaks at the TransCanada pipeline boosts the case for approving an extension of the line, the oil industry argued Monday. 

The American Petroleum Institute (API) said the administration’s request for corrective action at the pipeline shows the current system of federal oversight is effective.

“What we’ve seen over the last several weeks here is it’s almost proven that we have an effective regulatory process in place,” API Executive Vice President Marty Durbin said Monday.

Durbin argued that the administration’s response to two leaks on TransCanada’s 1,300-mile Keystone pipeline, which runs from Alberta to Oklahoma, shows that an extension of the pipeline — dubbed Keystone XL — should be approved.

“In some ways it actually supports the approval of the XL pipeline,” Durbin said of the proposed pipeline extension, which would carry Canadian oil sands to the Gulf coast. “They were able to detect the problems very quickly and take actions to stop the flow through the pipeline.”

Durbin, an executive at the country’s most powerful oil industry trade association, downplayed the significance of the recent leaks, which occurred last month A May 7 incident, for example, leaked roughly 400 barrels of oil in North Dakota

‘The leaks themselves were relatively small and they were at pumping stations involving specific pieces of machinery that were quickly detected,” Durbin said, noting that, “You always prefer to not have these things happen.”

But, despite the size of the leaks, the Department of Transportation’s Pipeline and Hazardous Materials Safety Administration (PHMSA) raised concerns about the pipeline Friday.

The agency issued a “corrective action order” arguing that “continued operation of the pipeline without corrective measures would be hazardous to life, property and the environment.” PHMSA ordered the Keystone pipeline to remain shuttered until TransCanada, the pipeline owner, showed that it could be safely restarted.

But a day later, PHMSA said it would allow the company to restart the pipeline because it had satisfied the safety requirements.

The leaks and PHMSA’s order has revived concern among environmental groups that the Keystone XL expansion would pose a risk of continued leaks. The groups encouraged the State Department, which is heading up a multi-agency review of the project, to take additional time to review the pipeline extension.

Green groups have mounted an aggressive campaign against the Keystone XL expansion in recent months.

Monday is the deadline for submitting comments to the State Department on its updated environmental review of the proposed Keystone XL pipeline.

API, in its comments, called on the administration to quickly approve the necessary permits necessary to move forward with the extension, noting that the initial timeframe for review of the project has been delayed several times. The groups argued that the project will result in thousands of jobs and make the country less reliant on Middle Eastern oil.

But a range of environmental and public interest groups calls on the federal government to reject the proposal, citing safety concerns and noting that Canadian oil sands production results in more greenhouse gas emissions than traditional oil production.

House Republicans are pushing legislation to mandate a decision on the Keystone XL pipeline by Nov. 1.

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