Canadian Oil Sands Likely Would Replace Dirtier Crude—Economist

May 17, 2013 11:42 am | Categories:

Environment & Energy Daily

By Whitney Blair Wyckoff

The Canadian oil sands crude that the Keystone XL pipeline would transport might be cleaner than the oil it would replace, a Massachusetts Institute of Technology energy economist testified before a House panel yesterday.

Christopher Knittel, who also serves as co-director for MIT’s Center for Energy and Environmental Policy Research, said while the State Department has estimated that life-cycle emissions for the Canadian bitumen are about 17 percent higher than those of the average oil sold in the United States, the comparison isn’t apt.

Referencing a report from Cambridge Energy Research Associates that includes life-cycle emissions information for various crudes, Knittel said it would be more relevant to compare it to something like heavy Venezuelan oil, a dirtier source that could be refined in the United States instead.

“It’s like me telling my son he can’t have a bag of chips because chips are worse than his typical food, only to see him put the chips away and grab an ice cream sandwich,” he said.

Citing the same report, Cindy Schild, a senior manager of the American Petroleum Institute’s oil sands operation—who was not a witness—said the Canadian oil sands crudes’ life-cycle greenhouse gas emissions are comparable to those of other types refined in the United States, including Venezuelan varieties.

“The point [Knittel] is probably getting to is … demand will be demand,” Schild said. “You have to consider the fact that if we’re not refining Canada’s oil, we’re going to be refining someone’s oil. So where do you want to get your oil from?”

Knittel said the pipeline is not going to have a large impact on greenhouse gas emissions, and he added that environmental issues at play with the pipeline tend to be more local concerns.

He made the remarks at a House Small Business Subcommittee on Agriculture, Energy and Trade hearing on the Keystone XL pipeline and job growth. The other witnesses on the panel—a labor union representative and two business leaders who were representing industry associations—stressed that the pipeline would generate new jobs. Peter Bowe, president and CEO of Baltimore-based Ellicott Dredges, said the “environmental extremists” who oppose Keystone XL are unconcerned about businesses like his.

Meanwhile, Knittel emphasized the need to pursue alternative forms of energy in the long term, and lamented that the pipeline has become a flash point.

“Climate change is one of the most important issues that this country has to address,” he said. But, he added, “using the Keystone pipeline as somewhat of a symbolic argument against oil is probably not an effective use of our time.”

Knittel also said that Keystone XL would not likely have a large impact on world oil prices—or prices paid at the gas pump.

At the end of the hearing, subcommittee Chairman Scott Tipton (R-Colo.) encouraged his colleagues to vote for H.R. 3, a bill to approve the construction, operation and maintenance of the Keystone XL pipeline, when it hits the House floor next week.