Markey Statement at Keystone Hearing: Say No to U.S. As Middleman in Oil Deal between Canada, South America, Europe, China

Statement by Congressman Edward J. Markey (D-Mass.)
Full Committee Markup on H.R. 3548, Keystone XL Pipeline Legislation
February 7, 2012


“The Keystone pipeline would carry some of the world’s dirtiest oil right through the middle of our country.  Whether it is the carbon pollution that spews into the skies or the oil spills that could foul our drinking water, there is no dispute that the environmental consequences attached to Transcanada’s pipeline will be grave.

“But we’ve been told repeatedly that it is worth it.  

“We’ve been told that the pipeline will lower gas prices even though TransCanada projects they would rise because it can charge more for Keystone oil in the Gulf than it does in the Midwest.

“We’ve been told that the pipeline will create tens of thousands of new jobs, even though it turns out that the number of jobs has been grossly inflated and only about 5 or 6,000 temporary construction jobs will be created.

“And in a particularly egregious play on American patriotism and American fears, we have also been told that the oil coming through this pipeline would enable us to reduce our dependence on oil imported from unfriendly Middle Eastern or Latin American nations.

“Last month, Canadian Prime Minister Stephen Harper even said that, ‘When you look at the Iranians threatening to block the Strait of Hormuz, I think that just illustrates how critical it is that supply for the United States be North American.’  

“This appears to be a complete fiction, because under this bill, there is no guarantee that even a drop of the tar-sands oil and fuels will stay in this country.  

“This is because many of the refineries where the Keystone crude will be sent plan to re-export the refined fuels.  
For example, Valero states in an investor presentation that it plans to refine the Canadian crude at the same facility it is building in Port Arthur because doing so leverages its ‘export logistics,’ and says that “growing global diesel demand is an export opportunity for U.S. refineries.”  Motiva, a joint refining venture between Shell and the Saudi Arabian Oil Company, is another one of Transcanada’s Port Arthur customers. The rest of Transcanada’s customers include a French company, 2 Canadian companies, and a multinational venture based in the Netherlands.

“And it is not just a regular moneymaking export opportunity that many of these companies are seeking.  Port Arthur, Texas is a Foreign Trade Zone, so when these refineries re-export the diesel and other fuels they make using Keystone oil, they won’t even have to pay U.S. taxes!

“Lest anyone think that Transcanada isn’t in the re-export business, in December, when I asked the President of Transcanada whether he would agree to ensure that the oil and refined fuels stay here in this country instead of re-exporting them, he said NO.   

“So that’s the plan in this Republican bill: Sneak the pipeline into the country, refine it, and then sneak the diesel fuel right back out.

“Yesterday, the gentleman from Nebraska said that tar-sands oil could replace the 2 million barrels of oil per day that we currently import from the Persian Gulf.  Even if the Keystone XL pipeline was going to transport more than the 630,000 barrels of tar sands oil each day that DOE estimates it will transport, the idea that all the Keystone oil will stay in this country under this bill is just a fantasy.

“Make no mistake. This bill is not about energy security. It is not about jobs.  It is about oil company profits, plain and simple. This bill just turns the United States into a middleman in a multinational oil deal between Canada, South America, Europe or China.

“The Republican slogan last year was Drill Here, Drill Now, Pay Less.  Now we’re letting Canada Drill There, Ship Here and Re-Export, all so we will have to pay more both in terms of money at the gas pump and cost to the environment.

“My amendment ensures that if this pipeline is legislated, the oil and any fuels made using it will stay here to benefit Americans.

“My amendment allows the President to waive this requirement only if it can be shown that an export of the oil or fuels won’t increase our dependence on oil or fuels we buy from hostile nations, and that prices for refiners and consumers won’t go up if the export occurs.  My amendment also preserves any international treaties or other agreements we have to export oil or fuels.  

“Let’s play it straight about the Strait of Hormuz – without my amendment, this pipeline will not do a thing to enhance the security of this country or of our brave men and women stationed all over the world for purposes of protecting our fossil fuel interests.  

“I urge my colleagues to support my amendment.”