Two thousand miles west of Washington, D.C., on the vast Nebraska prairie, you can drive for hours on roads that were once wagon trails, and rarely pass another car or truck. When one finally comes by, the driver will usually give you a little wave, like a lone hiker saluting another on a backcountry trail. And if you pull over to the side of that road, shouldered with wild sunflowers in late summer, a perfect stranger will worry enough about your stopped vehicle to circle back half an hour later to make sure that you are okay.
It was here, among the soft-spoken corn farmers and the tight-lipped cattle ranchers, and the billboards proclaiming, “Nebraska . . . the good life,” that troubles for the Keystone XL pipeline began.
The case for TransCanada’s proposed pipeline from the Alberta oil sands, through America’s heartland, to refineries on the Gulf Coast of Texas was simple: the Texas refineries depended on declining supplies of “heavy” crude oil from Mexico and Venezuela. The landlocked oil sands had growing, cheap supplies of the kind of crude in which the refineries specialized. All that was lacking was the pipeline to get it there.
Because the pipeline crossed the border, it required a permit from the president. George W. Bush had approved TransCanada’s first Keystone pipeline, from Alberta to the U.S. Midwest, in less than two years. Obama quietly okayed another oil sands pipeline to the Midwest, the Alberta Clipper, in 2009.
Access to Canadian oil had been so coveted by successive U.S. administrations that American negotiators had made it a priority in free trade negotiations in the 1980s. TransCanada assumed they’d have a permit by 2010.
The stakes were high. For the U.S., the project meant refining profits, stable supplies from a non-hostile regime and, in the aftermath of a recession, thousands of related jobs. For Canada, it was the key to unlocking the economic engine that the oil sands had become.
The pipeline’s proposed 830,000 barrels per day would come on top of the two million per day already heading from northern Alberta to the U.S.—Canada’s only customer. Without access to southern refineries, Canadian oil was piling up in the Midwest and selling at a discount. As wars raged in the Middle East, Canadian officials pushed a vision of continental energy integration: “Working together we can achieve what was dreamed about,” said Natural Resources Minister Joe Oliver, “and that is North American energy independence.”
But as energy markets analyst Bob McNally would later put it, “In the case of Keystone XL, just about everything that could possibly go wrong, did.”
The five-years-and-counting Keystone XL pipeline saga has become among the highest-profile environmental controversies to engulf North America in the 21st century and fodder for the merciless machinery of presidential politics. It has bred mistrust between Ottawa and Washington, and led a wary Prime Minister to press for a historic turning away from our largest trading partner toward markets entire oceans away. But even as its consequences mount, the full story of the Keystone XL dispute remains little understood. Attention has focused on Hollywood stars protesting the oil sands, and a standoff between Obama and Republicans over jobs and energy security.
The story is more than that. The Keystone XL project was ensnared as much by concerns over water as over air, and its first—and in some ways most effective—opponents were Republicans, operating far from the cameras of the national media. Their story opens a window on the unpredictable interplay between conservatism’s business wing and its grassroots, libertarian wing, and underscores how America’s restless and kaleidoscopic politics can confound Canadian diplomacy.
The storm around Keystone XL is remarkable not least because of where it began. In all its history, the state of Nebraska has voted for a Democrat for president exactly once: back in 1964. That this thoroughly Republican state of rural conservatism could trip up the cross-border energy trade occurred to no one when the pipeline was first proposed in 2008.
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