Keystone XL Pipeline Path Marks New Battle Line in Oklahoma

Opposition to the Keystone XL pipeline has united climate activists and property rights advocates in Oklahoma and Texas. Even if the oil industry wins this battle, has it lost the war of public opinion?

Part of our weekly "In Focus" series—stepping back, looking closer.

Elisabeth Leja is 74. She is a retired math teacher who does water aerobics and walks every day for her health. In February, Leja chained herself by the neck to a giant excavator in central Oklahoma that was digging the way for the Gulf Coast segment of the Keystone XL pipeline. (See related map: "Keystone XL: Mapping the Flow of Tar Sands Oil.")

Sitting a few weeks later on a sunny patio at her home in Norman, Oklahoma, Leja said she volunteered for the act of civil disobedience because she believes oil from Canada's tar sands is toxic and a major contributor to greenhouse gases. She is equally upset that TransCanada, which is building the pipeline, is seizing some Oklahomans' land by use of eminent domain. "We're sitting on this beautiful land and only corporations are benefiting from it," Leja said.

Leja, who has blue eyes, boyish hair, and often wears an orange stocking cap with long tassels that end in puffballs, is a foot soldier in an obscure but volatile front in the long war against Keystone XL.

Conventional wisdom is that the proposed the 1,700-mile (2,735-kilometer) link between Alberta and Texas has come one step closer to approval in the past week. The U.S. State Department released a 2,000-page analysis finding no compelling environmental reason to block the first direct link between one of the largest oil reserves on Earth and the world's most advanced refining center on the Gulf of Mexico.

But as the time draws closer for a final decision on the project by President Barack Obama, it is clear that the Keystone XL's list of enemies is growing ever more diverse.

Pipeline opponents garnered national attention last month, when some 40,000 protesters (according to organizers) assembled in Washington, D.C., to urge the White House to take a stand against fossil fuel emissions by vetoing the project. The event was billed as the largest rally ever held in the United States on climate change. Less noticed have been the bitter personal battles being waged in the trenches—literally, those being dug by TransCanada.

It's happening in the unlikeliest of places, the oil states of Oklahoma and Texas, where environmentalists have joined hands with conservatives furious over how the imperative to build the Keystone XL has trumped the property rights of those in its path.

"I have a real strong objection to a private business coming in and rolling over property owners in Texas," said Debra Medina, a vocal critic of TransCanada who ran as a Tea Party candidate for governor of Texas in 2010. "If I walked into your driveway and took your car, it'd be theft. How come I can take your [land] and it not be theft?"

The groundswell may not be enough to stop Keystone XL; indeed, TransCanada says the southern leg of the project is more than 50 percent complete, with the entire right-of-way cleared and welding and installation under way. The company says it is on track to bring the Oklahoma-to-Texas segment into service late this year.

But some analysts are beginning to wonder whether the energy industry might win the pipeline battle but lose the war in its effort to transport new oil and natural gas production and to reach expanded markets. Washington, D.C., energy consultant Kevin Book has remarked in the past that given Canada's plans to triple oil sands production to 5.1 million barrels per day by 2035, Alberta's producers won't need just one southbound pipeline but five or six more in the years ahead. (See related: "Scraping Bottom: The Canadian Oil Boom.") In a note to clients this week, he said Keystone XL might end up being a Pyrrhic victory for Canada's oil producers—and for unrelated energy industry players like coal and natural gas-if the many big infrastructure projects on the drawing boards face similar opposition and uncertainty.

North and South

Keystone's northern leg has gotten the lion's share of headlines; Obama refused to sign off on the required permit because of objections over the original proposed route across Nebraska's environmentally sensitive Sandhills and the Ogallala aquifer. TransCanada revised the pipeline path, and the U.S. State Department's new draft technical review found no reason to reject the path on environmental grounds. The final decision on the northern half of the pipeline, because it crosses an international border with Canada, will rest with Obama.

The 485-mile (780-kilometer) southern leg of Keystone XL, also known as the Gulf Coast Pipeline, was severed from the northern stretch last year so it could proceed as a stand-alone project.

Traversing Oklahoma and Texas en route to the Gulf Coast was supposed to be the easy part. Obama himself visited Cushing, Oklahoma, which bills itself as the "pipeline crossroads of the world," to bestow his blessing. "We're making this new pipeline from Cushing to the Gulf a priority," he said. "We're going to go ahead and get that done."

If Obama approves the northern leg, Cushing will be the nexus of the Keystone XL, which will carry both heavy tar sands oil from Canada as well as light, sweet crude from the booming Bakken shale formation in North Dakota and Montana. A separate TransCanada pipeline project is planned to send oil from North Dakota to a Keystone XL on-ramp in Baker, Montana. (See related story: "Oil Train Revival: Booming North Dakota Relies on Rail to Deliver Its Crude.")

Local leaders say Keystone XL will be good for Cushing's economy. On a recent  Tuesday afternoon, Brent Thompson, executive director of the Cushing Chamber of Commerce, remarked on the thick smell of petroleum that fills the air here. "Smells like money to me," he said. "God, I love it. Create them jobs, guys!"

Thompson and other locals also stress that pipelines are the safest form of transport for petroleum; the State Department essentially made the same point in its analysis, noting that Canadian producers likely will move their oil to market by train if the pipeline isn't built. In Cushing, Thompson says, a pipeline is not a worry "because we have so much experience with it."

Because of all its pipelines, Cushing is home to one of the world's largest above-ground stores of oil. The U.S. Energy Information Administration puts the capacity at about 64 million barrels, enough crude to fuel the nation for more than three days. An industry official estimates there are about 300 tanks spread at depots run by 15 different companies. Each maintains its own tank farms—vast stretches on Cushing's outskirts where cylinders, many about 40 feet (12 meters) tall, fill the horizon.

The tank farms have been growing for years; south of town, cranes rear into the sky while workers hustle underneath. They're building Cushing's newest tanks, seven in all, where TransCanada plans to store the oil from Canada and the Bakken. (See related photos: "Bakken Shale Oil Transforms North Dakota.")

Cushing has long been a key storage and trading hub, but there's a problem. The system was originally designed to move Texas and Gulf Coast oil to cities to the North, not to move oil from the North to the refineries of the South. So a lot of oil is sitting in tanks. "Our strength is we have a lot of lines coming into store," Thompson says. "Our weakness is we don't have a lot of lines going out."

The practical impact of this bottleneck has been a sagging price for the oil bought and sold at Cushing, the designated delivery point for crude traded on the New York commodities exchange, NYMEX. U.S. motorists haven't seen this low price at the gas pump; because most U.S. refineries aren't receiving Cushing oil, they are selling fuel at the higher global benchmark price of oil that dominates the market.

The Gulf Coast leg is supposed to help uncork the oil, although easing the congestion will not necessarily translate to lower gasoline prices for U.S. consumers. The more immediate impact would be to chip away at the huge profit margins that Midwestern refineries have enjoyed in the past two years relative to the refiners on the Gulf Coast, according to the State Department's market analysis of the project. The increased southward flow of Canadian and U.S. oil might mean fewer imports, but consumers still would pay prices at the pump that are based on the international price of oil. (See related story: "U.S. to Overtake Saudi Arabia, Russia as World's Top Energy Producer.")

Occupy Cushing

It's perhaps no wonder, then, that Keystone XL, whose clearest beneficiaries are Canadian oil producers and Gulf Coast refiners, has not been able to stir a great deal of grassroots support. Instead, Cushing, a no-frills industry town of 8,000, has become the new ground zero in the debate over U.S. energy and climate change policy. Leja's protest occurred just an hour south of Cushing, where TransCanada is digging its way to the oil hub.

She worked with a group called the Great Plains Tar Sands Resistance, which organizes what it calls "direct action," nonviolent acts aimed at disrupting the pipeline's progress. Members have trailed TransCanada through Texas and into Oklahoma. Now the resistance is staked out in a tent camp 15 miles from Cushing on land owned by sympathetic locals.

A member of the group, who identified himself only as George, said, "Cushing is a very visceral and physical representation of the enormity of the petrochemical industry in the U.S. We're trying to bring Cushing into the national discourse."

George and his half-dozen companions are all in their early 20s. None are from the area—George hails from Idaho while most others come from the Northeast—but they've coalesced against Keystone XL while living off donations to the cause or just charity in general. Many wear tattered clothes and sleep wherever they can. Meanwhile, they've been organizing locals opposed to the pipeline. During one such event, police pepper sprayed an elderly woman near Nacogdoches, Texas. That incident made national headlines.



Leja got some attention, too. Local media ran with the story of the 74-year-old who slid her slender neck into a U-lock, and then looped in another U-lock that she attached to the excavator. Leja sat on a pillow and read a library book. For several hours, she brought TransCanada to a grinding halt. "I knew it was possible they would pepper spray me," Leja said, "but I decided to be cute and read my library book." The book, "The Swallows of Kabul," features the stoning of a woman. Compared to that, Leja said, "I figured I got it pretty good."

Leja was eventually cut loose with a saw by the sheriff, booked for trespassing, and sent briefly to jail. The following week, a local youth pastor shimmied up a crane at a work site. More activism is planned throughout the spring, George says.

But local opposition is weak. At a recent meeting at a Tulsa public library, only five Oklahomans turned out. When pipeline opponents attempted to meet at the library in Cushing, local authorities caught wind of the plan and closed the building. "They were able to protest outside," said Cushing City Manager Steve Spears. "We anticipate more of that as the pipeline is built."

The Keystone XL has deep significance for climate activists primarily because extraction of sticky Canadian tar sands, which has to be either mined or steamed to the surface, has a carbon footprint about triple that of the average U.S. crude from conventional drilling, according to the State Department's analysis. (But because extraction accounts for only a small portion of oil's carbon emissions, which primarily issue from the tailpipes of vehicles, the State Department calculates that oil sands oil is only 17 percent more carbon-intensive when the entire lifecycle is considered.)

Pipeline opponents also worry about spills, especially because the thick Canadian oil, known as "diluted bitumen," or "dilbit," is different from conventional crude. In 2010, a pipeline owned by Calgary's Enbridge, burst open, pumping 1.1 million gallons of dilbit into a 40-mile (64-kilometer) stretch of Michigan's Kalamazoo River and nearby wetlands. At $800 million in cleanup expenses, it's the costliest onshore spill in U.S. history. A big reason why: light crude floats on the water and can be skimmed. Heavy crude sinks to the bottom, wreaking havoc on remediation efforts.

To help address environmental concerns, TransCanada has agreed to 57 operating and design features that go beyond typical safety measures to reduce the threat of a spill from the Keystone XL, the State Department said.

Property Rights Fight

Most Oklahoma landowners in the path of the Keystone XL pipeline have made deals that give TransCanada the right of access to their property. But some have had their land seized by eminent domain—a right that can be claimed by a common carrier, such as a utility or railroad, that provides a service to the public. In such a suit, landowners are forced to sell at what's deemed a market price. The company says it invokes eminent domain in fewer than 2 percent of cases. "TransCanada deals with more than 60,000 landowners each year and if we didn't treat them fairly and with respect, we wouldn't be in business," said spokesman Shawn Howard. "We have an excellent record negotiating voluntary agreements."

But some Oklahoma landowners did launch a legal challenge to the notion that TransCanada is a common carrier that serves the public. Keystone XL "doesn't serve anybody except the producers of Canada's tar sands," said Harlan Hentges, an attorney for one of the ranchers, Betty Sue Kelso. "It provides another country's private industry a pathway to the Gulf of Mexico."

TransCanada declined to pursue the fight against Kelso in court. "They didn't want to know the answer to that question [of whether it is a common carrier]," Hentges said. TransCanada is now digging through the land of Kelso's neighbor.

The common-carrier question is also at the heart of lawsuits in Texas. In one suit, rancher Julia Trigg Crawford is defending a portion of her 650-acre ranch from seizure by TransCanada. She argues that according to Texas statute, a common carrier must be intrastate, thereby serving the Texas public interest.

Much of the research on the statute has come from the conservative activist Deb Medina, who got involved only when an acquaintance "from the opposite end of the political spectrum" called her. Seeking an ally in the fight, he told her that TransCanada was evoking eminent domain in its pursuit of the pipeline. "I about fell out of my chair," she said. "How could a foreign, private company use eminent domain to do this?"

Based on her reading of Texas law, "it seems clear to me that common carriers are not ones that are passing through our state," Medina said. "They are the ones that are moving product from Midland-Odessa to Pasadena [within Texas]. That's a common carrier."

Meanwhile, three Texas towns have joined with the Sierra Club to attack the expedited process President Obama announced in Cushing. They argue that the Army Corps of Engineers improperly permitted the pipeline's 2,227 water crossings for the sake of efficacy, creating a legal loophole that allows the Gulf Coast pipeline to avoid a full environmental review.

Lawsuits will rage for some time. And the opponents on the ground say they're committed to the fight for the long haul. Few have any illusions they'll be able to stop the pipeline's construction. The real fight, then, may be for public opinion. That will almost certainly play out in the court battles ahead, as well as in the trenches, with activists chained to excavators.

"Certainly the resistance doesn't stop with the pipeline being buried," said Ramsey Sprague, a Texas environmental activist who supports the work of the Great Plains Tar Sands Resistance. "It doesn't stop when the pipeline comes online. There will be constant pressure."

This story is part of a special series that explores energy issues. For more, visit The Great Energy Challenge.

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