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KEYSTONE XL PIPELINE: 

EXAMINING SCIENTIFIC AND 

ENVIRONMENTAL ISSUES 

HEARING 

BEFORE THE

SUBCOMMITTEE ON ENVIRONMENT 

JOINT WITH THE 

SUBCOMMITTEE ON ENERGY 

COMMITTEE ON SCIENCE, SPACE, AND 

TECHNOLOGY 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED THIRTEENTH CONGRESS 

FIRST SESSION 

TUESDAY, MAY 7, 2013 

Serial No. 113–26 

Printed for the use of the Committee on Science, Space, and Technology 

( 

Available via the World Wide Web: http://science.house.gov 
(II) 

COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

HON. LAMAR S. SMITH, Texas, Chair 

DANA ROHRABACHER, California 

RALPH M. HALL, Texas 

F. JAMES SENSENBRENNER, JR., 

Wisconsin 

FRANK D. LUCAS, Oklahoma 

RANDY NEUGEBAUER, Texas 

MICHAEL T. MCCAUL, Texas 

PAUL C. BROUN, Georgia 

STEVEN M. PALAZZO, Mississippi 

MO BROOKS, Alabama 

RANDY HULTGREN, Illinois 

LARRY BUCSHON, Indiana 

STEVE STOCKMAN, Texas 

BILL POSEY, Florida 

CYNTHIA LUMMIS, Wyoming 

DAVID SCHWEIKERT, Arizona 

THOMAS MASSIE, Kentucky 

KEVIN CRAMER, North Dakota 

JIM BRIDENSTINE, Oklahoma 

RANDY WEBER, Texas 

CHRIS STEWART, Utah 

VACANCY 

EDDIE BERNICE JOHNSON, Texas 

ZOE LOFGREN, California 

DANIEL LIPINSKI, Illinois 

DONNA F. EDWARDS, Maryland 

FREDERICA S. WILSON, Florida 

SUZANNE BONAMICI, Oregon 

ERIC SWALWELL, California 

DAN MAFFEI, New York 

ALAN GRAYSON, Florida 

JOSEPH KENNEDY III, Massachusetts 

SCOTT PETERS, California 

DEREK KILMER, Washington 

AMI BERA, California 

ELIZABETH ESTY, Connecticut 

MARC VEASEY, Texas 

JULIA BROWNLEY, California 

MARK TAKANO, California 

ROBIN KELLY, Illinois 

SUBCOMMITTEE ON ENVIRONMENT

HON. CHRIS STEWART, Utah, Chair 

F. JAMES SENSENBRENNER, JR., 

Wisconsin 

DANA ROHRABACHER, California 

RANDY NEUGEBAUER, Texas 

PAUL C. BROUN, Georgia 

RANDY WEBER, Texas 

LAMAR S. SMITH, Texas 

SUZANNE BONAMICI, Oregon 

JULIA BROWNLEY, California 

DONNA F. EDWARDS, Maryland 

MARC VEASEY, Texas 

MARK TAKANO, California 

ALAN GRAYSON, Florida 

EDDIE BERNICE JOHNSON, Texas 

SUBCOMMITTEE ON ENERGY

HON. CYNTHIA LUMMIS, Wyoming, Chair 

RALPH M. HALL, Texas 

FRANK D. LUCAS, Oklahoma 

RANDY NEUGEBAUER, Texas 

MICHAEL MCCAUL, Texas 

RANDY HULTGREN, Illinois 

THOMAS MASSIE, Kentucky 

KEVIN CRAMER, North Dakota 

RANDY WEBER,Texas 

LAMAR S. SMITH, Texas 

ERIC SWALWELL, California 

ALAN GRAYSON, Florida 

JOE KENNEDY III, Massachusetts 

MARC VEASEY, Texas 

MARK TAKANO, California 

ZOE LOFGREN, California 

DAN LIPINSKI, Illinois 

EDDIE BERNICE JOHNSON, Texas 
(III) 

C O N T E N T S 

Tuesday, May 7, 2013 

Page 

Witness List ............................................................................................................. 2 

Hearing Charter ...................................................................................................... 3 

Opening Statements 

Statement by Representative Chris Stewart, Chairman, Subcommittee on 

Environment, Committee on Science, Space, and Technology, U.S. House 

of Representatives ................................................................................................ 9 

Written Statement ............................................................................................ 10 

Statement by Representative Suzanne Bonamici, Ranking Minority Member, 

Subcommittee on Environment, Committee on Science, Space, and Technology, U.S. House of Representatives ............................................................... 11 

Written Statement ............................................................................................ 12 

Statement by Representative Lamar S. Smith, Chairman, Committee on 

Science, Space, and Technology, U.S. House of Representatives ..................... 13 

Written Statement ............................................................................................ 14 

Statement by Representative Eric Swalwell, Ranking Minority Member, Subcommittee on Energy, Committee on Science, Space, and Technology, U.S. 

House of Representatives .................................................................................... 14 

Written Statement ............................................................................................ 15 

Statement by Representative Cynthia Lummis, Chairwoman, Subcommittee 

on Energy, Committee on Science, Space, and Technology, U.S. House of 

Representatives .................................................................................................... 70 

Written Statement ............................................................................................ 71 

Witnesses: 

Mr. Lynn Helms, Director, Department of Mineral Resources, North Dakota 

Industrial Commission 

Oral Statement ................................................................................................. 16 

Written Statement ............................................................................................ 18 

Mr. Brigham A. McCown, Principal and Managing Director, United Transportation Advisors, LLC 

Oral Statement ................................................................................................. 23 

Written Statement ............................................................................................ 25 

Mr. Anthony Swift, Attorney, International Program, Natural Resources Defense Council 

Oral Statement ................................................................................................. 42 

Written Statement ............................................................................................ 44 

Mr. Paul Knappenberger, Assistant Director, Center for the Study of Science, 

Cato Institute 

Oral Statement ................................................................................................. 59 

Written Statement ............................................................................................ 61 

Discussion ................................................................................................................. 70 

Appendix I: Answers to Post-Hearing Questions 

Mr. Lynn Helms, Director, Department of Mineral Resources, North Dakota 

Industrial Commission ........................................................................................ 91 
Page

IV 

Mr. Brigham A. McCown, Principal and Managing Director, United Transportation Advisors, LLC ............................................................................................ 96 

Mr. Paul Knappenberger, Assistant Director, Center for the Study of Science, 

Cato Institute ....................................................................................................... 102 
(1) 

KEYSTONE XL PIPELINE: 

EXAMINING SCIENTIFIC AND 

ENVIRONMENTAL ISSUES 

TUESDAY, MAY 7, 2013 

HOUSE OF REPRESENTATIVES, JOINT HEARING WITH THE SUBCOMMITTEE ON

ENVIRONMENT AND THE SUBCOMMITTEE ON ENVIRONMENT

COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY, Washington, D.C. 

The Subcommittees met, pursuant to call, at 10:03 a.m., in Room 

2318 of the Rayburn House Office Building, Hon. Chris Stewart 

[Chairman of the Subcommittee on Environment] presiding. 
2 

LAMAR S. SMITH. ToX"as 

CHAIfIMAN 

~ngress of the tlnitcd ~tates 

iRDusc of'Rcprcsrntatiocs COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

2321 RAYBURN HOUSE OFRce BUILDING 

WASHINGTON, DC 20515-6301 

1202) 225-6371 YIJWW.sclenca.hoUll8.gov 

Subcommittee on Environment 

And 

Subcommittee on Energy 

EOOIE BERNICE JOHNSON, T_ 

RANKING MEMBER 

Keystone XL Pipeline: Examining Scientific and Environmental Issues 

Tuesday, May 7, 2013 

10:00 a.m. - 12:00 p.m. 

2318 Rayburn House Office Building 

Mr. Lynn Helms, Director, Department of Mineral Resources, North Dakota Industrial 

Commission 

Mr. Brigham A. McCown, Principal and Managing Director, United Transportation Advisors 

LLC 

Mr. Anthony Swift, Attorney, International Program, Natural Resources Defense Council 

Mr. Paul "Chip" Knappenberger, Assistant Director, Center for the Study of Science, Cato 

Institute 
3 

U.S. HOUSE OF REPRESENTATIVES 

COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

SUBCOMMITTEE ON ENVIRONMENT 

SUBCOMMITEE ON ENERGY 

HEARL"IlG CHARTER 

Keystone XL Pipeline: Examining Scientific and Em'irolt1nentai IsslIes 

Tuesday, May 7, 2013 

10:00 a.m. 12:00 p.m. 

2318 Raybmn House Office Building 

PURPOSE 

On Tuesday, May 7 at 10:00 a.m. in Room 2318 of the Raybum House Office Building, 

the Subcommittee on Environment and the Subcommittee on Energy of the Conunittee on 

Science, Space and Technology will hold a hearing entitled Keystone XL Pipeline: E-ralllilling 

Scientific and Envirolllllel11al Issues. The purpose of this hearing is to examine the scientific and 

environmental aspects of the Keystone XL Pipeline, with a focus on the State Department's 

recently released Supplemental Draft Environmental Impact Statement. 

WITNESS LIST 

• Mr. Lynn Helms, Director, Depaliment of Mineral Resources, NOrtil Dakota Industrial 

COllllllission 

• Mr. Brigham A. McCown, Principal and Managing Director, United Transportation 

Advisors LLC 

• Mr. Anthony Swift, Attomey, International Program, Natural Resources Defense 

COlll\cil 

• Mr. Paul "Chip" Knappenberger, Assistant Director, Center for the Study of Science. 

Cato Institute 

BACKGROUND 

History 

In 2008, TransCanada alll\olUlced the Keystone XL pipeline expansion project, which 

would deliver Canadian oil sands to the Texas Gulf Coast refining complex in Nederland, Texas. 

The proposed project is 875 miles long, and would allow the transport of up to 830,000 baITels 

per day of crnde oil from Alberta and the Bakken shale. l Because the proposed project crosses an 

1 U.S. Department of State. Executive Summary--Draft Supplemental EnvirolUllental Impact Statement. Keystone 

XL Project. Accessible at: htlp:llkeystollepipelille-xl.state.govldraftseis/illdex.hltn 
4 

international bOlmdary, it is subject to the requirements of Executive Order \3337", which 

requires the Secretmy of State to detenuine if a project is in the "national interest" before a 

Presidential Permit can be granted. 

The TransCanada Corporation submitted an application for the Presidential Pennit in 

September 2008, and the State Department conducted an extensive envirolUnental review called 

an EnvirolUnental Impact Statement (EIS). In April 2010, the State Department's draft EIS was 

released, which found that the project would have "no significant impacts to most resources 

along the proposed route".3 The Department took public COlllluent on the draft EIS, and released 

a final version in August 20 II, which supported approval of the project. 

However, in January 2012, President Obama atmounced that he would reject the 

constrnction of the pipeline in its cUllent form, calling for a "full assessment of the pipeline's 

impact, especially the health atld safety of the Americatl people, as well as our environment.,,4 

The following month, TrallsCanada atmounced it would split the pipeline into two projects, mid 

proceeded with plans to coustmet the Southern segment from Cushing. Oklahoma to the Gulf 

Coast, referred to as the Gulf Coast Project. In May 2012, TratlSCanada submitted a new 

Presidential Permit Application for the remaining international half of the pipeline, from the 

Canadian border to Steele City, Nebraska. 5 

Re-Rollte 

The Presidential Pennit application submitted in May 2012 included a new route tIu'ough 

Nebraska that avoided the ecologically sensitive Sand Hills region and alleviated concerns 

regarding the Ogallala aquifer.6 The Nebraska Department ofEnvirolllllental Quality conducted 

atl analysis of the new route. atld concluded that the pipeline could be built atld operated safely. 

The State of Nebraska approved the revised route in January of this year, and Governor Dave 

Heineman sent a letter to President Obatna atld Secretary Clinton that slUllInarized tIle findings 

of the DEQ report and expressed tIlis approval. 7 

Currell! Status 

On March l't, the State Depattment released its Draft Supplemental EllvirolUuelltal 

Impact Statement (SEIS). which built and expanded on the 2011 Final Envirolll1lental Impact 

Statement and included analysis of the new route through Nebraska. 8 The expanded atlalysis 

considered economic effects, impacts from potential releases or spills, impacts related to climate 

change. and clllnu!ative effects from fue proposed project in combination with other projects. 

TIle State Depat1ment also re-exatnined and expatlded evaluation of project altematives, 

2 http://www.gpo.gov/fdsys/pkgIWCPO-2004-0S-10/pdffWCPO-2004-0S-10.Pg723.pdf 

'u.s. Department of State. Final Draft Envirorunenlal Impact Stalement. Seclion3.15 Envirorunenl.1 Analysis. 

Summary of Findings. Accessible al: http://keystonepipeline-xl.stale.gov/doc,IDlentslorg.nizalionll82070.pdf 

4 Statement by the President on the Keystone XL Pipeline, Jannary 18.2012. Accessible at: 

http://www.whitehouse.gov/tbe-press-office/2012/01/18/statemelll-president-keystolle·x1-pipelille 

, TransCanada Keystone XL Timeline. Accessible at: 

bttp:IIwv.'W.transcanada.comisociallresponsibility/2011Ikeystone_xIItimelinel 

6 New Keystone XL Pipeline Application: http://\\'\\'W.keystonepipeline-x1.state.gov/ 

7 Letler from Got'emor Dave Heineman to President B.rack Obama. Secretary Hillmy Rodham Clinton. January 22. 

2013. Accessible at: http://w\\'W.govemor.nebraska.gov!llews/2013/0Ildocsl0122_Pipeline_Approval.pdf 

• htlp:IIwv.'W.state.g;<lv/rfpalprs/ps/2013/03/205548.htm 
5 

including other possibilities for crude oil transport such as raiL The release of the SEIS was 

noticed in the Federal Refster on March 27th, which specified that the 45 day public COlllment 

period began on March 8 .9 

Several key findings frolll the Draft SEIS: 

• Environmental Impacts: "The analyses of potential impacts associated with 

construction and normal operation of the proposed Project suggest that there would be no 

significant impacts to most resources along the proposed Project route [asslUlling 

Keystone complies with all laws and required conditions and measures]." 

• Market Analysis: "The 20 II FEIS concluded that the project is lUllikely to significantly 

affect the rates of extraction in the oil sands or in US refining activities. Changes in the 

petroleum markets since 20 II are not anticipated to alter the outlook for the crude oil 

market in a manner that would lead to a change in the key conclusions reached in the 

2011 FEIS." 

• Potential Releases: "Comparison of incident data from Alberta pipeline systems with 

data fi'om U.S. pipeline systems indicates that Albelta pipelines that have likely shipped 

diluted bitmllen (dilbit), synthetic crude oil (SCO), or Bakken shale oil are not more 

prone to failure than other pipeline systems carrying conventional cmde oils." 

• Indirect Cumulative Impacts and Life-Cycle GHG Emissions: "It is lmlikely that tlle 

proposed Project construction would have a substantial impact on tlle rate ofWCSB 

[Western Canada Sedimentruy Basin] oil sands development. Even when considering the 

incremental cost of non-pipeline transport options. should the proposed Project be denied. 

a 0.4 to 0.6 percent reduction in WCSB production could occur by 2030, and should both 

the proposed Project and all other proposed pipeline projects not be built, a 2 to 4 percent 

decrease in WCSB oil sands production could occur by 2030." 

• No Action Alternative: "Given that production of WCSB and Bakken cntde oil will 

proceed with or without the proposed Project, the denial of a Presidential Pennit would 

likely result in actions by other [mns in tlte United States (ruld global) petrolelUumarket, 

such as use of altemative modes to transpolt WCSB ruld Bakken cmde oiL" 

On April 22"d, the public comment period 011 the Draft SEIS closed, and the State 

Department will now review the comments and make revisions before publishing a final SEIS.lO 

After publication of the final doclmlent, the State Department will consult with other agencies 

before determining whether or not issuing a Presidential Penuit is in the national interest. This 

decision, referred to as the National Interest Determination (NID), requires consideration of 

many factors, including energy security, envirolUllelltal, cultm'al, and economic impacts, foreign 

policy, and compliance with federal regulations. The Deprutment has stated it intends to provide 

additional opportunity for public comment during the NID period. 

9 Federal Register Volume 78. NlUllber 59. Wednesday, March 27. 2013. Accessible at: 

http://www.gpo.gov/fdsys/pkgIFR-2013-03-27Jl!tI1l112013-07072.htl1l 

10 U.S. Department ofStnte, Keystone XL Pipeline Project, Project Infonnalion. Accessible at: 

http://www.keystonepipeline-xl.state.gov/ 
6 

Following the National Interest Detennination, EO 13337 requires the Secretary of State 

to issue or deny the pelmit in accordance with the NID, 1Uuess notified by another cabinet 

official that they disagree with the proposed detennination and request the Secretary to refer the 

application to the President. In the event of such a disagreement, the Secretary of State is 

required to consult with the official who expressed it, and refer the application to the President 

for consideration and a fmal decision. 11 

Additional Reading: 

• U.S. Department of State. Executive S1Unmary-Draft Supplemental Environmental 

hnpact Statement for the Keystone XL Project, March 2013. Accessible at: 

http://keystonepipeline-xl. state.gov/ documents/ organizationl205719 . pdf 

• IHS CERA, The Role of the Canadian Oil Sands in the U.S. Market: Energy Security, 

Changing Supply Trends, and the Keystone XL Pipeline, Special Report. Accessible at: 

http://aI024.g.akamai.net/£l1 024/13 859/1 dlihsgroup.download.akamai. eomll3 8S9/ills/eer 

alThe-Role-of-the-Canadian-Oils-Sands-in-the-US-Market.pdf 

• Keystone XL Timeline: See Appendix 1. 

II http://www.gpo.!!ov/fdsyslpkgIFR-2004-05.05/pdf/04-10378.pdf 
7 

Appendix 1. Keystone XL Timeline11 

• September 19. 2008: TransCanada submits an application to the State Department for a 

Presidential Permit for the Keystone XL pipeline. The State Department annotmced it 

will conduct an EnviroIUnental Impact Statement (EIS). 

• January -June 2009: The State Department conducts 20 "scoping" meetings in 

commtmities along the proposed route to explore issues to be exanlined in the EIS, and 

consults with federal and state agencies and Native American tribes impacted by the 

pipeline. 

• April 2010: The State Department issues its Draft EnviroIUllental Impact Statement, and 

opens a 45 day public comment period, which will later be extended. The Draft EIS fmds 

that the project would have "limited adverse environmental impacts during both 

construction and operation." 

• April-September 2010: The State Depal1ment solicits comments on the proposed 

project, and twice extends the public comment period on the Draft EIS. 

• October 2010: When asked, Secretary of State Clinton says we [State Department] are 

"inclined to approve" the Keystone XL project. 

• January 2011: TransCanada agrees to 57 additional safety features requested by the 

State Depal1ment and the Pipeline and Hazardous Materials Safety Administration 

relating to the construction, operation, and design of the pipeline. 

• April 2011: The State Dep31iment releases a Supplemental Draft EIS, which it notes 

"does not alter the conclusions" of the draft issued a year previous. 

• April-June 2011: Public comment peliod for the Supplemental Draft £IS 

• August 2011: The State Depal1ment releases its Final EIS, which supports moving 

forward with the pipeline. It also opens a 90 day review period. 

• August-October 2011: The State Depaliment conducts its National Interest 

Determination, and solicits public comment and holds meetings in six states 31ld the 

District of Columbia. 

• ~ovember 2011: The State Depal1ment suspends the pennitted process for Keystone XL 

until the re-route to avoid the Sand Hills region in Nebraska is complete. TransC311ada 

works with the state of Nebraska to identify 311 altemative route, and Nebraska codifies a 

!2 Information included in this time line was gathered from several sources and existin" tintelines. Sources include 

timelines from the State Department. tbe Congressional Research Sen'ice, the Heritage Foundation, and 

T ran,Canada. 
8 

process for approval of the route, which involved the state's Department of 

Environmental Quality. 

• December 2011: The House and Senate approve and the President signs the payroll ta.'\: 

bill, which requires the President approve or deny the Keystone XL pennit within 60 

days. 

• January 2012: In response to the 60 day requirement included in PI. 1 12-78, President 

Obama annoUllces he will not approve the constmction of the Keystone XL Pipeline in its 

current form, but will allow TransCanada to re-apply for a Presidential Pernlit. 

• February 2012: TransCanada amlOlmces it is dividing the Keystone XL project into two 

parts. The lower half of the project, from Cushing, Oklahoma, to the Gulf, does not cross 

an international border and thus does not require an international penn it. 

• March 2012: President Obama states his SUppOlt for the Gulf Coast Project and that he 

will expedite the pernlitting. 

o Construction of the Gulf Coast Project proceeds. 

• April 2012: TransCanada submits a fe-route of the pipeline to the state of Nebraska for 

review. 

• May 2012: TransCanada submits a new Presidential Pemnt application to the State 

Department for the Keystone XL pipeline project running from the U.S.-Canada border in 

Montana to Steele City, Nebraska. 

• June 2012: The State Department publishes a Notice ofIntent to prepare a Supplemental 

EIS for the second Keystone XL Presidential Pennit application. 

• January 2013: Govemor Dave Heineman gives notice of Nebraska's approval of tile 

reroute through Nebraska. 

• March 2013: The State Department issnes its draft Supplemental EIS (SE1S) for the 

Keystone XL pennit application, which includes the re-route through Nebraska. The 

fmdings in the SEIS build upon and largely confiml those in the FEIS issued in August of 

2011. 

o March 8-April 22"d: 45 day public comment period on the SEIS. 
9 

Chairman STEWART. Good morning. The joint hearing on the 

Subcommittee on Environment and the Subcommittee on Energy 

will come to order. Welcome to today’s joint hearing entitled ‘‘Keystone XL Pipeline: Examination of Scientific and Environmental 

Issues.’’ In front of each Member are packets containing the written 

testimony, biographies, and truth-in-testimony disclosures for today’s witnesses. 

Before we get started, and since this is a joint hearing involving 

two Subcommittees, I wanted to explain how we will operate procedurally, so all Members will understand how the question-and-answer period will be handled. As always, we will alternate between 

the majority and minority Members. After first recognizing the 

Chair and Ranking Members of the Environment and Energy Subcommittees, we will then recognize those Members present at the 

gavel in order of seniority on the Full Committee, and those coming 

in after the gavel will be recognized in order of arrival. 

And I now recognize myself for five minutes for my opening 

statement. 

I would like to thank the witnesses for being with us today. We 

appreciate your service and the sacrifice you made, and we look 

forward to hearing for you—from you. 

The subject of today’s hearing, construction of the XL pipeline, is 

of profound economic and national security interest. The proposed 

pipeline has been under continuous review for more than four 

years. Now, let’s think about that for a moment. More than four 

years, that is about the length of time it took the United States to 

fight and win World War II. You can complete a university degree 

in four years. A large portion of the transcontinental railroad was 

built in four years. You can do a lot of things in four years. The 

only thing we can’t do is get this Administration to make a decision 

about building a much-needed pipeline. 

During the past four years, as this project has been studied, we 

have learned that the pipeline is safe and environmentally sound. 

We also know it will create jobs and it promotes energy security. 

In fact, in 2010, then-Secretary of State Clinton signaled as much 

when she said that the State Department was likely to approve the 

project. That, of course, sparked an outcry from the Administration’s environmental allies, resulting in politically driven delay and 

additional review, all of which came at considerable expense and 

further loss of economic opportunity. 

The comment period on the State Department’s most recent 

Draft Supplemental Environmental Impact Statement, or SEIS, 

closed just months—for last month. In that report, the State Department found that the proposed project is safe. It uses state-ofthe-art materials, coating, construction practices, and monitoring 

systems. The State Department SEIS goes on to say that the pipeline would be one of the safest pipelines ever built or operated. 

In regard to its effects on the environment, the Department 

found ‘‘that there would be no significant impacts.’’ And because 

the project will have little or no impact on oil sands production— 

the Canadian oil will be brought to market whether or not the Keystone pipeline is built—effects on carbon emissions would be negligible. 
10 

And while the EPA claims that over a 50-year period the additional emissions would create as much as 935 million metric tons 

of greenhouse gases, this is far less than one percent of global 

emissions. As Paul Knappenberger of the Cato Institute will tell us 

today, even using EPA’s worst-case scenario assumptions, the effect 

of the pipeline would only increase the rate of warming by an imperceptible 1/100,000 of a degree per year. 

In regard to jobs, the State Department estimates that the pipeline would have significant positive socioeconomic impacts in the 

form of local employment, increased tax revenue, ancillary business 

development, and increased spending by workers on goods and 

services. As the Department states in the SEIS, ‘‘the proposed 

project would potentially support approximately 42,100 average annual jobs across the United States. This employment would potentially translate to approximately $2.05 billion in earnings.’’ 

And there is also this important point: the President frequently 

urges us to reduce our reliance on foreign oil from unstable, undemocratic regimes that are unfriendly to the U.S. interests. As a 

former Air Force pilot, I have personal knowledge of how important 

it is to reduce our reliance on sources of energy that emanate from 

instable and unpredictable areas of the world. If you want to enhance our national security while decreasing the need to put our 

sons and daughters in harm’s way in far-off regions of the world, 

then build the Keystone pipeline. 

Finally, building the pipeline will allow us to increase our trading relationships with Canada, a stable and friendly democracy 

with whom we share a long and peaceful border. 

In short, the pipeline is in the national interest. There is no logical reason not to allow it to move forward. 

I now recognize the gentlelady from Oregon, the Ranking Member, Ms. Bonamici, for her opening statement. 

[The prepared statement of Mr. Stewart follows:] 

PREPARED STATEMENT OF ENVIRONMENT SUBCOMMITTEE CHAIRMAN CHRIS STEWART

The subject of today’s hearing, construction of the XL pipeline, is of profound economic and national security interest. 

The proposed pipeline has been under continuous review for more than four years. 

Let’s think about that for a moment. More than four years. That’s about the length 

of time it took for the United States to fight and win WW II. You can complete a 

university degree in four years. A large portion of the transcontinental railroad was 

built in four years. We can do a lot of things in four years. The only thing we can’t 

do is to get this Administration to make a decision about building a much-needed 

pipeline. 

During the past four years, as the project has been studied, we have learned that 

the pipeline is safe and environmentally sound. We also know it will create jobs and 

that it promotes energy security. In fact, in 2010, then-Secretary of State Clinton 

signaled as much when she said that the State Department was likely to approve 

the project. That, of course, sparked an outcry from the Administration’s environmental allies, resulting in politically driven delay, and additional review—all of 

which came at considerable expense and further loss of economic opportunity. 

The comment period on the State Department’s most recent Draft Supplemental 

Environmental Impact Statement, or SEIS, closed just last month. In that report, 

the State Department found that: 

• The proposed project is safe. It uses state-of-the-art materials, coating, construction practices, and monitoring systems. The State Department SEIS goes on to 

say that the pipeline would be one of the safest pipelines ever built or operated. 
11 

• In regard to its effects on the environment, the Department found ‘‘that there 

would be no significant impacts.’’ And because the project will have little or no 

impact on oil sands production—the Canadian oil will be brought to market 

whether or not the Keystone pipeline is built—effects on carbon emissions 

would be negligible. 

And while the Environmental Protection Agency claims that over a 50-year period, the additional emissions ‘‘could be as much as 935 million metric tons’’ of 

greenhouse gases, this is far less than one percent of global emissions. As Paul 

Knappenberger of the Cato Institute will tell us today, even using EPA’s worst-case 

scenario assumptions, the effect of the pipeline would only increase the rate of 

warming by an imperceptible one one-hundred-thousandth of a degree per year. 

In regard to jobs, the State Department estimates that the pipeline would have 

significant positive socioeconomic impacts in the form of local employment, increased tax revenues, ancillary business development, and increased spending by 

workers on goods and services. 

As the Department states in the SEIS, ‘‘the proposed Project would potentially 

support approximately 42,100 average annual jobs across the United States . . . This 

employment would potentially translate to approximately $2.05 billion in earnings.’’ 

And there is also this important point: the President frequently urges us to reduce 

our reliance on foreign oil from unstable, undemocratic regimes that are unfriendly 

to U.S. interests. As a former Air Force pilot, I have personal knowledge of how important it is to reduce our reliance on sources of energy that emanate from unstable 

and unpredictable areas of the world. If you want to enhance our national security, 

while decreasing the need to put our sons and daughters in harm’s way in far-off 

regions of the world, then build the Keystone pipeline. 

Finally, building the pipeline will allow us to increase our trading relationship 

with Canada, a stable and friendly democracy with whom we share a long and 

peaceful border. 

In short, the pipeline is in the national interest. There is no logical reason not 

to allow it to move forward. 

I now recognize the gentlelady from Oregon, Ranking Member Bonamici, for her 

opening statement. 

Ms. BONAMICI. Thank you very much, Chairman Stewart. I don’t 

see Chairwoman Lummis. 

I want to welcome our witnesses and thank you all for participating in today’s hearing about the Keystone XL pipeline. The discussion we are having here today is important because the Keystone pipeline project heightens and highlights an issue that this 

Committee has been debating for a long time: climate change 

caused by human activity. There has been disagreement with colleagues across the aisle regarding the human role in the changing 

climate. For that reason, I was pleased a few weeks ago when the 

Subcommittee on the Environment held a climate change hearing 

in which all of the witnesses agreed in their testimony that global 

warming is happening, humans are contributing to it, and the 

country must take action to address it. 

This is relevant to today’s hearing because the Keystone XL pipeline showcases our continued dependence on fossil fuels, the use of 

which contributes greatly to anthropogenic climate change. I am 

pleased that this hearing will also address potential negative impacts of the pipeline on those living and working along the proposed pipeline route, including those engaged in agricultural activities. 

I am glad that the witnesses will also be discussing the pipeline’s 

impact on land use and that they will discuss potential threats that 

large-scale pipeline projects can pose to fragile water resources. 

Also significant are local concerns about the cleanup of potential 

spills from the pipeline. I joined many of my colleagues who know 

that we must be thoughtful and informed before we give the goahead to traverse the thousands of miles of the American country-
12 

side with new infrastructure for an old energy source. According to 

the State Department’s Draft Environmental Impact Statement, 

the Keystone XL pipeline will bring thousands of temporary construction jobs and positively impact local economies at a time when 

our country is navigating through a slow economic recovery. These 

short-term benefits to our economy should not be overlooked, but 

they should be considered alongside with the substantial environmental and safety challenges presented by the pipeline, including 

the potentially disastrous impact on the local economy if they still 

were to occur. 

That happened not too long ago in Michigan. A pipeline transporting oil from Canada to the United States’ destinations ruptured 

and spilled about 800,000 gallons of crude oil into the Kalamazoo 

River. Now, three years later, cleanup is yet to be completed because of the difficult task of getting the heavy oil sands out from 

the river floor where much of it remains submerged. The EPA recently recommended that the State Department take a closer look 

at how spills of oil sands may require different response actions or 

equipment from response actions for conventional oil spills. That is 

why Congress requested that the National Academy of Sciences 

study this type of oil, and it is my hope that we will soon know 

more about what differences exist between oil sands and conventional crudes. 

In closing, although I would never claim to speak for all the 

Democrats about the Keystone project specifically, we do all agree 

that our country must set ambitious goals to combat anthropogenic 

climate change. Fossil fuels will continue to play a role in powering 

our economy for the foreseeable future, but we must also invest 

more in renewable energy as a 21st century solution to combat climate change, boost our job markets, and reduce our dependence on 

fossil fuels over the long term. I look forward to hearing the witnesses’ perspectives on the environmental and safety issues associated with that project. 

And with that, Mr. Chairman, I yield back. 

[The prepared statement of Ms. Bonamici follows:] 

PREPARED STATEMENT OF ENVIRONMENT SUBCOMMITTEE RANKING MEMBER SUZANNE

BONAMICI

Than you, Chairman Stewart and Chairwoman Lummis. I want to welcome our 

witnesses and thank you all for participating in today’s hearing about the Keystone 

XL Pipeline. The discussion we are having today is important because the Keystone 

pipeline project highlights an issue that this Committee has been debating for a 

long time: climate change caused by human activity. There has been disagreement 

with colleagues across the aisle regarding the human role in the changing climate. 

For that reason, I was pleased two weeks ago when the Subcommittee on the Environment held a climate change hearing in which all the witnesses agreed in their 

testimony that global warming is happening, humans are contributing to it, and the 

country must take action to address it. 

This is relevant to today’s hearing because the Keystone XL Pipeline showcases 

our continued dependence on fossil fuels, the use of which contributes greatly to anthropogenic climate change. I am pleased that this hearing will also address potential negative impacts of the pipeline on those living and working along the proposed 

pipeline route, including those engaged in agricultural activities. I’m glad that the 

witnesses will also be discussing the pipeline’s impact on land use and that they 

will discuss potential threats that large-scale pipeline projects can pose to fragile 

water resources. Also significant are local concerns about the clean-up of potential 

spills from the pipeline. I join many of my colleagues who know that we must be 
13 

thoughtful and informed before we give the go-ahead to traverse thousands of miles 

of the American countryside with new infrastructure for an old energy source. 

According to the State Department’s Draft Environmental Impact Statement, the 

Keystone XL Pipeline will bring thousands of temporary construction jobs and positively impact local economies at a time when our country is navigating through a 

slow economic recovery. These short-term benefits to our economy should not be 

overlooked, but they should be considered alongside the substantial environmental 

and safety challenges presented by the pipeline, including the potentially disastrous 

impact on the local economy if a spill were to occur. 

That happened not too long ago in Michigan. A pipeline transporting oil from 

Canada to U.S. destinations ruptured and spilled 800,000 gallons of crude oil into 

the Kalamazoo River. Now, three years later, cleanup has yet to be completed because of the difficult task of getting the heavy oil sands out from the river floor 

where much of it remains submerged. The EPA recently recommended that the 

State Department take a closer look at how spills of oil sands may require different 

response actions or equipment from response actions for conventional oil spills. 

That’s why Congress requested that the National Academy of Sciences study this 

type of oil, and it is my hope that we will soon know more about what differences 

exist between oil sands and conventional crudes. 

In closing, although I would never claim to speak for all Democrats on the Keystone projct specifically, we do all agree that our country must set ambitious goals 

to combat anthropogenic climate change. Fossil fuels will continue to play a role in 

powering our econmoy for the foreseeable future, but we must also invest more in 

renewable energy as the 21st century solution to combat climate change, boost our 

job markets, and reduce our dependence on fossil fuels over the long term. I look 

forward to hearing the witnesses’ perspectives on the environmental and safety 

issues associated with this project. And with that, Mr. Chairman, I yield back. 

Chairman STEWART. I thank you, Ms. Bonamici. 

Noting that the Chair of the Subcommittee on Energy, Mrs. 

Lummis, is on her way but not here yet, we will now turn to the 

Full Committee Chair, Mr. Smith. 

Chairman SMITH. Thank you, Mr. Chairman. 

In December 2008, then-President-elect Obama announced a 

massive new economic stimulus proposal, which he said would 

focus on ‘‘shovel-ready’’ construction projects. Less than three 

months earlier, TransCanada submitted to the Federal Government what might be considered the epitome of all shovel-ready 

projects: the request to build a 1,700 mile Keystone pipeline from 

Alberta to the Texas Gulf. Four-and-a-half years have passed since 

the President made ‘‘shovel-ready’’ part of the political discussion. 

Today, TransCanada still waits for the Federal Government to 

decide whether allowing the company to create more than 40,000 

jobs building a pipeline to deliver oil from an ally is in our national 

interest. Many Americans would consider such a decision to be simple, but the Federal Government has required millions of dollars, 

years of study, and thousands of pages of reports. Fortunately, the 

end is in sight. In the coming months, the Obama Administration 

will decide the future of the pipeline. 

Today, we will discuss the scientific and environmental factors at 

the center of the debate that surrounds this decision. Ultimately, 

there are two major concerns in this debate: (1) whether we have 

the ability to construct and operate the pipeline safety, and (2) 

whether the pipeline’s construction will contribute significantly to 

climate change. On both of these questions, extensive analysis undertaken by the State Department has affirmed the safety and environmental soundness of the project. For example, with respect to 

greenhouse gas emissions, the worst-case scenario projected that 

approval of the pipeline could result in a U.S. annual carbon dioxide emissions increase of only 12/1000 of one percent. 
14 

The Keystone pipeline creates jobs and enhances our energy 

independence with minimal impact on the environment. This 

project, which is been thoroughly evaluated, should be approved 

immediately. I hope today’s discussion will provide Members a useful scientific and environmental background for decision making as 

we move to consider legislation regarding Keystone on the House 

floor later this month. 

Thank you, Mr. Chairman, and I will yield back. 

[The prepared statement of Mr. Smith follows:] 

PREPARED STATEMENT OF FULL COMMITTEE CHAIRMAN LAMAR S. SMITH

In December 2008, then-President-elect Obama announced a massive new economic stimulus proposal, which he said would focus on ‘‘shovel-ready’’construction 

projects. Less than three months earlier, TransCanada submitted to the Federal 

Government what might be considered the epitome of all shovel-ready projects: a request to build the 1,700-mile Keystone Pipeline from Alberta to the Texas Gulf. 

Four and a half years have passed since the President made ‘‘shovel ready’’ part 

of the political discussion. Today, TransCanada still waits for the Federal Government to decide whether allowing a company to create more than 40,000 jobs building a pipeline to deliver oil from an ally is in our national interest. Many Americans 

would consider such a decision to be simple. But the Federal Government has required millions of dollars, years of study, and thousands of pages of reports. 

Fortunately, the end is in sight. In the coming months, the Obama Administration 

will decide the future of the pipeline. Today, we will discuss the scientific and environmental factors at the center of the debate that surrounds this decision. 

Ultimately, there are two major concerns in this debate: (1) whether we have the 

ability to construct and operate the pipeline safely, and (2) whether the pipeline’s 

construction will contribute significantly to climate change. 

On both of these questions, extensive analysis undertaken by the State Department has affirmed the safety and environmental soundness of the project. For example, with respect to greenhouse gas emissions, the worst-case scenario projected that 

approval of the pipeline could result in a U.S. annual carbon dioxide emissions increase of only 12 one-thousandths of one percent. 

The Keystone Pipeline creates jobs and enhances our energy independence with 

minimal impact to the environment. This project, which has been thoroughly evaluated, should be approved immediately. I hope today’s discussion will provide Members a useful scientific and environmental background for decision making, as we 

move to consider legislation regarding Keystone on the House floor later this month. 

Thank you, and I yield back. 

Chairman STEWART. Thank you, Mr. Smith. 

The Chair now recognizes the Ranking Member of the Subcommittee on Energy, Mr. Swalwell. 

Mr. SWALWELL. Thank you, Chairman Stewart and Chairwoman 

Lummis, for holding this hearing today. I also want to thank our 

witnesses for being here, and I do appreciate the opportunity to examine the costs and benefits of this project in greater detail. 

And Chairman Stewart, you did point out the length of time it 

has taken, which I do appreciate. We want to move projects along 

as quickly as possible. But I do think when you are dealing with 

so many miles, almost 1,000 miles with this particular project, it 

is in our interest to make sure that we get it right because, although it has taken four years to look at this project, it could take 

only a matter of seconds to cause devastating consequences to our 

environment, our Earth, and people around the pipeline. And I 

think it is worth making sure that we get it right. 

And I will take the opportunity to point out that it has been over 

two months now that we have been waiting for a Secretary of Energy to be approved by the Senate, and that confirmation of Ernest 
15 

Moniz has been held up in the Senate and has been blocked by one 

individual. So I am also frustrated about how long it takes for 

things to happen. I think it is an antiquated, bizarre system where 

one individual can block a Secretary from being approved, and that 

individual, the Secretary of Energy, would play a prominent and 

important role in this project and other renewable projects. So I 

hope that the Senate starts to move along this nominee so that we 

can get to work and see what this project’s impact will continue to 

be, and I am in favor of moving things along as well. 

I also think it has been pretty clear and I have made it known 

from this position that I believe in a balanced, all-of-the-above approach when it comes to our energy production, but when it comes 

to determining whether we should approve a project as large and 

long-lasting as a pipeline that would transport 830,000 barrels of 

tar sands oil from Canada to the Gulf Coast every day, I want to 

make sure that we have a full and clear understanding of the total 

number of U.S. jobs we can expect the Keystone XL pipeline to create, the impacts on climate change, and the chances and consequences of a major spill. 

I always have said that if we can make it safe, we should make 

it happen. If we find we can’t make it safe, we should find ways 

to make it happen. And ultimately, if there is no way to make it 

environmentally safe, then I don’t think we should make it happen. 

I also think that if we are looking forward and we are looking at 

that pie chart of where our energy supply is coming from, it is in 

our best interest to continue to expand the part of the chart that 

comes from renewables, which, right now, I believe is too small and 

there is a lot greater potential for us to expand that part of the 

chart, which I also believe and history has shown can create madein-America jobs, just as many jobs as the Keystone pipeline would 

create. 

So I look forward to discussing these important issues with you 

today. And with that, I yield back the balance of my time. 

[The prepared statement of Mr. Swalwell follows:] 

PREPARED STATEMENT OF RANKING MEMBER OF THE COMMITTEE ON ENERGY ERIC

SWALWELL

Thank you, Chairman Stewart and Chairwoman Lummis, for holding this hearing 

today, and I also want to thank the witnesses for being here. I appreciate the opportunity to examine the costs and benefits of this controversial project in greater detail. 

I agree with those who say we need an‘‘all-of-the-above’’ approach to energy production. But when it comes to determining whether we should approve a project as 

large and long-lasting as a pipeline that would transport 830,000 barrels of tar 

sands oil from Canada to the Gulf Coast every day. I want to make sure that we 

all have a clear understanding of the total number of U.S. jobs we’d expect the Keystone XL Pipeline to create, the impacts on climate change, and the chances and 

consequences of a major spill. 

I look forward to discussing these important issues with each of you today. With 

that, I yield back the balance of my time. 

Chairman STEWART. Thank you. Thank you, Mr. Swalwell. 

We will—it is now time to introduce the members of our panel 

today and once again with our gratitude for you being here. It 

takes me a little bit to introduce them because they are very distinguished with long resumes. 
16 

Our first witness is Mr. Lynn Helms, the Director of the Department of Mineral Resources, the North Dakota Industrial Commission. Previously, he has worked as a Production Engineer, a Reservoir Engineer, and an Asset Team Leader on projects in Abu 

Dhabi, Alaska, North Dakota, Texas, and Wyoming. 

Our second witness is Mr. Brigham A. McCown, the Principal 

and Managing Director of United Transportation Advisors. Mr. 

McCown has over 25 years of executive, legal, and operations management experience in areas pertaining to energy, transportation, 

and the environment. He most recently served as the first acting 

Administrator of the Pipeline and Hazardous Materials Safety Administration at the U.S. Department of Transportation. 

Our third witness is Mr. Anthony Swift, an attorney for the 

International Program at the Natural Resources Defense Council. 

Prior to working at the NRDC, Anthony worked as a Policy Analyst 

for the Department of Transportation where he worked on alternative fuels, efficiency standards, and a National Environmental 

Policy Act review process. 

And our final witness today is Mr. Paul ‘‘Chip’’ Knappenberger, 

the Assistant Director at the Center for the Study of Science at the 

Cato Institute. Mr. Knappenberger has over 25 years of experience 

in climate research and public outreach, including 13 years with 

the Virginia State Climatology Office and 17 years as a Research 

Coordinator for the New Hope Environmental Services, Incorporated. 

As our witnesses should know, spoken testimony is limited to 

five minutes each, after which Members of the Committee have five 

minutes each to ask questions. Your written testimony will be included in the record of the hearing. 

And I now recognize our first witness, Mr. Helms, for five minutes. 

STATEMENT OF MR. LYNN HELMS, DIRECTOR, 

DEPARTMENT OF MINERAL RESOURCES, 

NORTH DAKOTA INDUSTRIAL COMMISSION 

Mr. HELMS. Good morning, Mr. Chairman and Members of the 

Committee. Thank you for the invitation to speak to the Committee 

on Science, Space, and Technology. I love that title. We try to do 

our things in North Dakota on a science basis. We try—this one obviously the science is in, and now we are into the political phase 

of the Keystone XL pipeline. 

Why does North Dakota have a stake in this? North Dakota is 

the home of the Bakken, as you well know, the largest unconventional resource discovered in the United States of America. We are 

currently producing 780,000 barrels of oil per day. We have a commitment to place 60,000 barrels of oil per day on Keystone XL the 

day that it opens, and that can be expanded to 100,000 barrels a 

day. That was a tough negotiation with TransCanada to get that 

on ramp in our neighbor in Baker, Montana. 

The shortfall in pipeline capacity out of the State of North Dakota has resulted in a very disrupted transportation system, and 

you see that on page two of my testimony. Seventy-one percent of 
17 

our oil now moves out of the State by rail. And I personally authored a paper in 2006 that said I couldn’t believe that would ever 

happen. It was uneconomic, it was too expensive, it didn’t make 

sense, it was impractical, but 71 percent of our crude oil now moves 

by rail out of the State of North Dakota. 

In addition to that, 10,000 barrels a day gets trucked into Canada to find a pipeline and another 35,000 barrels travels by semi 

back into North Dakota to reach those rail facilities to move out 

of the State, so it’s a very disrupted system that we have in North 

Dakota. 

What does Keystone mean to western North Dakota? It would 

mean 300 to 500 less long-haul truck trips per day from oil and gas 

wells to rail stations in western North Dakota. Now, our figures 

show that those trucks emit 2.9 times the greenhouse gases, they 

commit three to four times the number of spills that a pipeline 

does. They produce dust; they produce accidents. So Keystone XL, 

for every year that it is in service, it is going to reduce North Dakota’s greenhouse gas emissions by almost one million kilograms per 

day. It is going to reduce oil spills by 60 to 80 per year. It is going 

to reduce traffic fatalities by three to six and injury accidents by 

85 to 100. 

So let’s turn that around. For every year the Keystone is delayed, 

we emit one million kilograms per day of greenhouse gases that 

could not be emitted. We suffer 60 to 80 oil spills per year that 

don’t have to happen, three to six people die on North Dakota highways unnecessarily, and 85 to 150 people suffer serious traffic injuries, and that doesn’t need to happen. 

I took a look at the SEIS. The spill frequency and impact analysis are consistent with our experience in North Dakota with pipeline construction and what we have seen. The greenhouse gas evaluation is consistent with North Dakota’s experience. As I stated, I 

co-authored a paper in 2006 that was pretty dismissive of rail 

transportation for Bakken crude oil, and yet, changes in the market, changes in rail efficiency, and people being innovative in the 

way they move crude oil now puts 71 percent of our oil on the rails. 

One last thing: my experience with Keystone XL goes a little bit 

beyond the borders of North Dakota. My family lives in Harding 

County, South Dakota. They built a brand-new school based on the 

property taxes the Keystone XL is expected to pay. My sister-in-law 

is a teacher in that school. My son-in-law is a farmer in York County, Nebraska. Keystone XL will go right across 1/4 of his land. We 

have had lots of discussions about it. He has no qualms about it. 

He irrigates out of the Ogallala aquifer, and he is completely prepared for the pipeline to transverse his farmland. 

So we believe in the State of North Dakota that it is time to 

build Keystone XL. I yield the remainder of my time for questions. 

Thank you, Mr. Chairman. 

[The prepared statement of Mr. Helms follows:] 
18 

Congress ofthe United States 

House of Representatives 

Committee on Science, Space, and Technology 

Subcommittee on Energy 

And 

Subcommittee on Environment 

May 7, 2013 

Room 2318 Rayburn House Office Building, Washington, DC 

Testimony by Lynn D. Helms, Director 

North Dakota Industrial Commission 

Department of Mineral Resources 

The Bakken Fonnatioll is a large unconventional resource that underlies most of the 

western portion of the state of North Dakota and eastern Montana. The United States Geolo!/ical 

Survey stated in their April 2013 report that it is the largest continuous resotu·ce they have 

assessed in the lower 48 states. 

Production fi·om Bakken development has moved Nodh Dakota from number eight to 

number two among US states in daily production at almost 780,000 baneIs of oil per day. 

Achieving those production levels has required significant increases in pipeline, natural gas 

processing, electric generation and transmission, refming, highway, and housing capacity. 

Major sh0l1falls in pipeline capacity have resulted in a very 1mbalallced trallspodatioll 

market as can be seen in the following chads. Lack of pipeline capacity in the midcontinent has 

led to much higher oil prices on the coasts and shifted the nonnal transp0l1alion mode away from 

pipelines, to higher risk and impact alternatives; such as rail and truck. 
19 

Estimated Williston Basin Oil Transportation 

Pipeline Export Tesoro Refinery 

Truck to Canadian Pipelines ., Estimated Rail 

Currently, 5,000 to 10,000 barrels of sour North Dakota crude are being trucked into 

Canada to access pipelines selving the best markets for that type of oil while 35,000 banels per 

day is being trucked into NOlth Dakota to access rail transportatiollioadillg facilities selving the 

beslmarkets for that type of oil. 

Williston Basin Truck Imports/Exports 

50,000 

45,000 

40,000 

> 

... 35,000 a 

.. 

CI 30,000 Q. 

'" 

~ 25,000 

to 

CIl 20,000 

(5 15,000 CI 

't:I 

" 10,000 Q 

5,000 

o 

2 
20 

Keystone XL has signed up over 60,000 barrels per day of Bakken cmde to transpOit 

from Baker to Guemsey and has cOllmlitted to cany 100,000 banels per day. CmTently, thaI 

production is being h1lcked from the wells to rail facilities. This is the equivalent of 50 long haul 

Imck loads for each 10,000 banels. Once Keystone XL is in place, those tmcked banels will 

most likely be connected to a gathering system that will deliver them to Keystone XL. Approval 

of Keystone XL will cause two things to happen: 1) 300 - 500 tmck-loads per day will be taken 

offNo11h Dakota highways and 2) there will be 1 - 2 less trains per day leaving North Dakota. 

Our calculations show that green-house gas emissions from rail transpOitation are 1.8 

times and frolll h1lck transportation are 2.9 times the emissions fi'om pipeline transportation. In 

addition, oil spills from tmck transportation occur at 3 - 4 times tIle rate of spills from pipelines. 

Approval of the Keystone XL pipeline will result in 450,000- 950,000 Kg/day less green-house 

gas emissions in North Dakota as well as significant decreases in dust and 60 - 80 fewer spills 

per year. 

In the five years from 2006-20 II the lllnnber of crashes involving semi-tmcks has risen 

substantially. Fatal crashes have more than doubled, injmy crashes have more than tripled. and 

property damage crashes have doubled. The rate of fatal crashes has remained constant at 1.4 

and injtuy crashes at 40 per 100 million miles driven. Approval of the Keystone XL pipeline is 

expected to reduce highway fatalities in North Dakota by 3 to 6 per year and injury crashes by 85 

to 150 ammally. 

3 
21 

The findings of the State Department Supplemental EnvirolUnental Impact Statement 

(SEIS) regarding spill frequency and inlpacts are consistent with our experience regulating spill 

reporting and reclamation in Not1h Dakota. 

The fmdings of the State Dep311mellt Supplemental Environmental Impact Statement 

(SEIS) regarding potential green-house gas emissions fi'om rail tr31lsportation of oil s31lds 

production to markets is consistent with our experience in North Dakota. In 2006. I co-authored 

an analysis of Williston Basin Cmde Oil Bottlenecks that concluded tr31lsportation by rail would 

be an inefficient, Imeconomic, 8hOl1 feml solution. As sho\'<n by the current Notth Dakota oil 

transportation breakdown the size of the resource, ch31lging markets, and innovations in the rail 

transportation indu8tty have resulted in just the opposite. 

4 
22 

Lynn D. Helms 

Diredor, North Dakota Department of Mineral Resources 

His work in the oil industty has taken LYlm Helms all over the world. Most recently, 

Lynn has served as Director of the North Dakota Industrial COlllmission Oil & Gas Division 

since July 1998 and Director of the Deprutment of Mineral Resources since it was fomled in July 

2005. Before moving to Bismarck to work in state govenllllent, he worked as a production 

engineer, reservoir engineer, and asset team leader 011 projects in Abu Dhabi, Alaska. Arkansas. 

Lonisiana, Mississippi, Montrula, New Mexico, NOlth Dakota, Texas. and Wyoming. Lynll 

eanted his Bachelor of Science Degree in Engineering fi-mn South Dakota School of Mines and 

Teclmology. When he's not working Lynn enjoys spending his free time with his wife, collegeaged children, and his four horses. 

5 
23 

Chairman STEWART. Thank you, Mr. Helms. 

Mr. McCown. 

STATEMENT OF MR. BRIGHAM A. MCCOWN, 

PRINCIPAL AND MANAGING DIRECTOR, 

UNITED TRANSPORTATION ADVISORS, LLC 

Mr. MCCOWN. Chairman Stewart, Ranking Member Bonamici, 

Chairman Lummis, and Ranking Member Swalwell, thank you— 

and distinguished Members, thank you for the invitation to be here 

today to testify at this joint hearing on Keystone XL. 

You know, this process is important and, I think, even crucial to 

better understanding the role that pipelines play in our everyday 

lives. The Pipeline and Hazardous Materials Safety Administration, an agency within the USDOT, is responsible for overseeing 

the safe and secure movement of over one million hazardous material shipments each and every day by air, by land, by sea, by rail, 

and yes, by pipeline. You know, and at no point in our Nation’s history has the role and future of our national pipeline infrastructure 

been subject to more careful review and scrutiny. 

We have 2.6 million miles of pipeline in this country and that is 

enough to circle the Earth 100 times. And we have, for close to half 

a century, transported the lion’s share of our Nation’s energy supplies via pipeline. And for most of that time, our underground energy highways, if you will, have remained out of sight and out of 

mind. That, of course, is no longer the case, given the heated debate surrounding the approval of the remaining portion of the Keystone pipeline system. Last year, pipelines transported 11.3 billion 

barrels of crude—that is B as in billion—barrels of crude and refined products. Of that amount, pipeline operators safely transported these supplies 99.999952 percent of the time. Yes, pipeline 

releases can and do occur, but we also have to understand that the 

goal of our robust and mature pipeline safety regulations is zero accidents, zero releases. And when a pipeline upset does occur, comprehensive federal regulations exist to minimize the consequences 

of any such releases. 

That record is strong and even getting better. In fact, thanks to 

strong government oversight by PHMSA, new technologies, and a 

shared approach to risk management by all stakeholders, pipeline 

accidents continue to decline. Over the last decade, pipeline spills 

have decreased—the number—by 59 percent and total volume of 

releases has decreased by 43 percent even as the overall production 

has increased, both the mileage of active pipelines and the freight 

tons shipped by them. I think this is an extraordinary figure when 

you consider that pipelines transport almost 2/3 of all the energy 

supplies consumed in our country each year. 

Although the Draft EIS dedicates 200 pages to the rail alternative, Federal Government statistics on accident data reveal that 

pipelines are approximately 4–1/2 times safer than rail and 64 

times safer than commercial motor vehicle if you look at freight 

tons shipped. To take it a step further, on a per-ton-mile basis, 

those figures translate that pipelines are over five times safer than 
24 

rail and almost 500 times safer than commercial motor vehicles or 

trucks. 

Pipelines are also unique in that they are the only transportation 

system we have that does not require a round-trip to load and deliver supplies. Rail and truck have their place as an integral component of a tightly interwoven supply-chain system. That said, 

pipelines represent the best when it comes to hauling large volumes of energy products over great distances. 

Critics of Keystone are quick to highlight the claim that oil sands 

resources like those transported by Keystone are more corrosive 

than traditional crude oil, thus, more likely to spill. This is simply 

not true. The Federal Government has not documented a single instance where the release of oil sands crude was caused by internal 

corrosion of the pipeline. The characteristics of diluted oil sands 

crude are similar to conventional crude and, in fact, Canadian diluted bitumen, sometimes called dilbit, is actually less corrosive 

than oil from Mexico, Colombia, and even California. 

While opponents claim the opposite, no studies have validated 

such an assumption. While it may be tempting and politically expedient to point to corrosiveness as something to be feared, the fact 

that it makes for a good talking point doesn’t make it true. Scrutiny is, of course, welcome and a warranted thing, but in the face 

of this analysis, it is of utmost importance that we as a Nation recognize the indispensable role that pipelines play. Let there be no 

mistake, energy plays a crucial role in our Nation’s economy, and 

energy security depends on important infrastructure projects like 

Keystone. 

Thank you, Mr. Chairman. 

[The prepared statement of Mr. McCown follows:] 
25 

~lJTA IJnIt"d TrJlnspot1Jltlon 4d,lsors, lle 

UNITED TRANSPORTATION ADVISORS, LLC 

Hearing: Keystone XL Pipeline: 

Examination of Scientific 

and Environmental Issues 

Before the Subcommittee on Energy, 

and Subcommittee on Environment 

Committee on Science, Space and Technology 

United States House of Representatives 

Written Statement of Brigham A. McCown 

Former Acting Administrator & Deputy Administrator 

Pipeline & Hazardous Materials Safety Administration 

U.S. Department of Transportation 

Expected Delivery 10:00 A.M. EDT 

May 7, 2013 
26 

Testimony of Brigham A. McCown 

STATEMENT OF BRIGHAM A. MCCOWN 

FORMER ACTING ADMINISTRATOR / DEPUTY ADMINISTRATOR 

PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION 

BEFORE THE 

SUBCOMMITTEE ON ENERGY & SUBCOMMITTEE ON ENVIRONMENT 

COMMITTEE ON SCIENCE. SPACE AND TECHNOLOGY 

UNITED STATES HOUSE OF REPRESENTATIVES 

May7,2013 

I. Introduction 

Page 2 of 16 

Good morning. Thank you for the invitation to testify today at this joint hearing of 

the Subcommittees on Energy and Environment of the Science. Space and 

Technology Committee regarding the Keystone XL Pipeline: Examination o[Scientijic 

and Ellvirollmelltallssues. 

This is an important hearing, and an opportunity for us to explore and discuss 

pipeline safety, especially as it applies to the proposed Keystone pipeline expansion 

project. I commend the Committee for dedicating time and resources to this 

important issue. Today we stand at a crossroads in our national energy policy. The 

question before us is whether the proposed expansion project is in our national 

interest and the outcome of that decision will impact America's energy future, our 

competitiveness, and energy security for decades to come. 

My transportation safety perspective is based upon real life experiences in both the 

public and private sectors. My testimony today will focus on my belief that buiJding 

the remaining portion of the Keystone pipeline system is, for many reasons, clearly 

within the national interest of the United States - and based on the avaiJable 

information and plans for construction, the completed Keystone system would be 

the safest pipeline ever built in this country, if not in the entire world. 
27 

Testimony of Brigham A. McCOI.m November 9, 2011 

II. OVERVIEW 

Today, I am pleased to offer several observations concerning the approval process 

for the Keystone XL expansion project. At the outset, I note that the Keystone 

Pipeline System is a series of pipelines designed to transport Canadian and U.S. 

crude oil to American refineries in the Midwest and to the Gulf Coast When 

completed. this entire system would represent a state-of-the-art pipeline system 

capable of delivering over 1.1 million barrels of oil per day to U.S. refineries. A 

staggering figure when one considers that in February of this year, the United States 

imported 579,000 barrels per day from Venezuela and 1.0 million barrels of oil per 

day from Saudi Arabia.! The pipeline system itself represents a tangible asset with 

an estimated value of approximately $12 billion.2 

While I will limit my prepared testimony to discussing matters pertaining to 

transportation safety, the following points are worthy of recognition. 

• The Keystone Pipeline System Has Already Been Largely Approved and 

Built. 

o Three of the Four Phases of Keystone have already been approved. 

o Two of the Three Phases are already operational. 

o Phase Three will become operational by the end of2013. 

• Pipelines Are The Safest Form of Transportation, Bar None. 

o While all modes of transportation are relatively safe, pipelines are the 

preferred method for transporting large volumes of energy products. 

o The Department of State (DOS) studies have confirmed existing data 

that "spills associated with the proposed Project that enter the 

environment are expected to be rare and relatively small." (4.16-6) 

1 Sonrce: U.S. Energy Information Administration. 

2 Source: TransCanada. 
28 

Testimony of Brigham A. McCown Page 4 of 16 

• Keystone is the Safest Pipeline Ever Proposed & Built. 

o The Department of State correctly concludes "the incorporation of the 

57 Special Conditions will result in the project having a degree of 

safety over any other typically constructed domestic oil pipeline 

system." (4.13-64) 

• Despite Claims To The Contrary, Oil Sands Crude Is No Different Than 

Other Conventional Heavy Crude Oils. 

o Multiple studies by Canadian, British and American entities have all 

concluded that Canadian dilbit mixtures have similar, and in some 

cases even a lower corrosivity score than crude oils from Mexico, 

Columbia, and California.3 

o Crude derived from oil sands has been transported by pipeline since 

19684• 

o Diluted bitumen has been transported for over 25 years. 

o U.S. Government safety data has not found a single instance of a 

pipeline release (spill) caused by internal corrosion from Dilbit5• 

• Canada's Oil Sands Will Continue to be Developed. 

o Despite the growth of U.S. oil production, the Canadian oil sands will 

playa critical role in supplying the U.S. energy demand. 

o Rail and vessel currently assist pipelines in bringing oil to markets 

and that trend will continue. 

, See Alberta Innovates Technology Futmes, "Comparison of the Conosi,-ity of Dilbit and 

Com'entional CHIde" September 2011; Battelle Memorial Institute, "Diluted BinullenDeri,'ed Crude Oil: Relati"e Pipeline Impacts" July 20, 2012; CEPA & Penspen Integrity, 

"Dilbit Corrasi"i!y" February 21, 2013. 

4Id. . • 

; Id. See also, Lidiak P, "Diluted BinImen; \'\1,at it is, pipeline transpOltation and impact on 

pipelines" Presentation to TRB Panel, In.l),, 2012. 

4 
29 

Testimony of Brig bam A. MeeO"ll Novembel' 9. 2011 

• Environmental Concerns Concerning Phase Four Have Already Been 

Thoroughly Vetted and Addressed 

o Threats to Ogallala Aquifer are misplaced. Pipelines have safely 

transported crude and refined products over the aquifer since at least 

1953. 

o Multiple environmental studies by U.S. Government and University of 

Nebraska experts have all concluded the pipeline will not threaten the 

ecological stability of the region. 

o Executive Order 13337 was intended to expedite, not hinder crossborder permits. 

III. The Keystone Pipeline System 

In order to fully appreciate the magnitude of this debate, as well as the fact that we 

are all discussing a significant infrastructure project that has largely already been 

approved and built, please allow me to describe the various components making up 

the Keystone Pipeline System. 

Phase One 

Known simply as Keystone, the original pipeline was proposed in 2005, approved by 

the National Energy Board of Canada in 2007, and was granted a Presidential Permit 

on March 17,2008. Keystone began commercial operation in june of 2010. This 

1.853 mile initial 30" pipeline carries 435,000 barrels per day of Canadian crude 

from HardiSty, Alberta. The line travels east in Canada until its southerly turn takes 

Keystone through the eastern third of North and South Dakota and Nebraska where 

it passes just west of Lincoln, Nebraska. The line then continues to Steele City, 

Nebraska where it turns east, passing through Missouri just North of St. Louis before 

ending at Patoka, Illinois. 

Phase Two 

The "Keystone Cushing Extension" linked Steele City, Nebraska to Cushing, 

Oklahoma. That 298 mile 36" portion was completed in late 2010 and made 
30 

lestimony of Brigham A. McCown 

operational in February of 2011. With this addition, the commercial design of 

Keystone was increased to 591,000 barrels per day. 

Phase Three 

Page 60r 16 

Commonly referred to as the "southern portion of Keystone XL" and officially known 

as the "Gulf Coast Expansion Project," this 435 mile 36" pipeline will link Texas 

refineries with storage facilities in Cushing, Oklahoma. This portion is currently 

under construction, and is expected to become operational by the end of 2013. 

Phase Four 

The entire current debate centers on the final Keystone proposal. This last piece of 

the Keystone Pipeline System requires a Presidential Permit due to the border 

crossing between the United States and Canada. This phase requires 327 miles of 

new construction in Canada and 852 miles of new construction in the United States. 

The proposed 36" line would extend through Montana and South Dakota where it 

would provide access to U.S. Bakken crude before ending in Steele City, Nebraska.6 

IV. Pipeline Safety 

Pipelines are very much like our nation's highways. or perhaps more accurately 

described by a Congressional Committee as being the "arteries of the Nation's 

energy infrastructure, as well as the safest and least costly ways to transport energy 

products ... [and] provide the resources needed for national defense, to heat and 

cool our homes, generate power for business, and fuel an unparalleled 

transportation system."? 

Transportation Secretary Norman Mineta CD-CAl, who I had the pleasure of serving, 

went even further when he described pipelines as "the unsung heroes of our 

, Phase FOtu also includes a 46.7 mile pipeline betweenletinelies ill the Houston, Texas 

area. 

H.R. Rep. Xo. 109.717, at 5 (2006); See also, PH~fSA athttp://Lllsa.goY/13XAlJ3 

6 
31 

Testimony of Brigham A. Meeo"1l November 9, 20 II 

economy,"8 Pipelines have been the preferred mode of transportation for energy 

products since the early 1900s, 

In a sense, pipelines make our current way oflife possible as they transport 70% of 

all hydrocarbon sources of energy used in our country. It is not a stretch therefore 

to suggest that pipelines really are the very lifeblood of the American economy, and 

without them, the quality oflife we are accustomed to, simply would not exist. 

Totaling a little over 2.6 million miles, the U.S. has more pipelines than any other 

country in the world. The Pipeline and Hazardous Materials Safety Administration 

(PHMSA) is the federal agency responsible for overseeing the safe and secure 

movement of approximately two-thirds of all energy products consumed in this 

country each and every day. The men and women of PHMSA are dedicated, hardworking professionals who oversee a robust regulatory and enforcement agency 

along with PHMSA's state p.\rtners. They are up to the challenge of regulating a very 

complex transportation system. 

No Safer Alternative 

As stated above, pipelines are dearly the safest and most cost-effective means to 

transport the extraordinary volumes of natural gas and hazardous liquid products 

that fuel our economy. Not only are they safe and cost-effective, pipelines are 

efficient. They often provide the most direct routes, and they do so without adding 

to congestion on our highways or rail lines. 

To better illustrate this fact, take a major East Coast airport and remove the pipeline 

supplying that facility. To deliver the comparative volume of jet fuel would take a 

constant line of tanker trucks. about 750 per day. loading up and moving out every 

two minutes, 24 hours a day. seven days a week. The railroad-equivalent of this 

single pipeline would be a train of seventy-five 2.000-barrel tank rail cars every 

5 Secretary Xorman Y. :'\Iineta speech during the 3'" Annual Pipeline Legal Issues and Policy 

ROlmdtable, Annapolis, :\IaIyland,Jnly 2005. 
32 

Testimony of Brigham A. McCown Page 8 of 16 

day.'" The alternative mode becomes even more daunting when one considers that 

pipelines are the only mode of transportation that does not require repositioning of 

tanker cars or trucks. In order to keep the logistical lines open therefore would 

require double to triple the necessary assets mentioned above in order to create a 

round-trip logistical system. The most recent SElS referenced several no-action 

alternatives. One of these options was transporting the oil by rail, or rail and tanker. 

Prior to discussing each mode as an alternative, it is first worth mentioning that all 

forms of transportation: pipeline, rail and commercial motor vehicles are safe. and 

each has a specific role in a robust logistics system. 

That said. however. substantially increasing the freight requirements by any other 

mode in lieu of pipeline transport would have a significant negative impact on the 

transportation system. For these reasons, none of the other modes can effectively 

and efficiently carry out the duties performed by pipelines. 

With respect to rail. even assuming for arguments sake that rail could in fact handle 

the tonnage requirements between the specific points serviced by Keystone10• rail 

falls short in comparison. Similarly. cargo vessel traffic on navigable waterways is 

also and untenable alternative. although it should be noted that some Canadian 

product is currently finding its way to market via barge. Finally, transport by motor 

carrier is also untenable. 

Pipelines are the safest mode of transport based on ton-miles of freight, on a permile basis or by total crude sbipped. 

Based on total accidents per billion ton-miles shipped. an accident is 530% more 

likely to occur when shipped by rail. 1330% more likely when shipped by vessel, 

and 49,590% more likely when shipped by truck. 

• http://l.nsa.goY/107yA 7Y 

10 TIle State Department draft assumes rail is capable of handling the capacit)' issue based on 

2011 studies. TIle freight capacity analysis of rail is howe,"er much more complex. It is 

doubtful rail could adeqnatelr sen-ice the requirements from point to point. 

8 
33 

Testimony of Bligham A. McCmm November 9.2011 

Second, although rail has seen a recent resurgence, it is not an economically viable 

option. [n the ElS, the State Department included an estimate of rail prices 

compared to the cost of pipeline export. Pipeline cost is approx. $7/bbl. while actual 

rail cost is $31/bbl. Third, rail causes much more harm to the environment than 

pipelines. It was estimated in the EIS, rail would cause 8% more greenhouse gas per 

year than the XL pipeline. Addendums "CAY' and "(B)" to my testimony contain 

additional statistical data for comparison purposes. 

V. Keystone Pipeline Safety 

Keystone is implementing state-of-the-art safety requirements and guidelines in 

materials. coatings. construction practices and monitoring systems. especially for 

the crossings of roads. highways and railroads. all of which adds to the unparalleled 

safety of the Keystone system. 

It should be noted that the "DOS. in consultation with PHMSA. has determined that 

incorporation of those [57 Special Permit) conditions would result in a project that 

would have a degree of safety over any other typically constructed domestic oil 

pipeline system." C4.13-64} 

For spill and leak prevention efforts. Keystone is taking significant steps to 

maximize safety, and [concnr with the DOS findings that "Cs)pills associated with 

the proposed Project that enter the environment are expected to be rare and 

relatively small." (4.16-6) 

Without belaboring the point, Keystone has incorporated significant safety 

protocols. which are not always found on other pipelines. These include mitigation 

and quality control improvements covering everything from pipe production. 

construction practices. operations, maintenance. damage prevention and emergency 

response. 
34 

r estimony of Brigham A. McCown Page 10 of 16 

Aside from numerous federal studies attesting to the safety of Keystone, a thorough 

review of the planned safety provisions built into the pipeline's construction, 

operation, and monitoring, provides assurances Keystone will, and is, operating 

safely and it is my personal opinion that the Keystone XL pipeline's design provides 

an excellent example of world-class safety protocol. 

VI. Keystone Studies 

Since TransCanada filed for a Presidential Permit with the U.S. Department of State 

in 2008 to construct the Keystone Pipeline expansion project, the federal 

government has undertaken a thorough and rigorous risk assessment for this 

project as guided by Executive Order 13337. That Executive Order, issued by 

President George W. Bush was intended "to expedite reviews of permits as 

necessary to accelerate the completion of energy production and transmission 

projects ... connecting the United States with a foreign country .... "11 

The State Department issued its first Environmental Impact Statement (EIS) in 

August 2011 in accordance with National Environment Policy Act of 1972 (NEPA). 

Following revisions to a portion of the initial approved route in Nebraska, a 

Supplemental Environmental Impact Statement (SEIS) was issued on March 1st, 

2013. 

From both a safety and NEPA point of view, it is not possible to suggest that this has 

not been the most scrutinized, and carefully reviewed pipeline project in our 

nation's history. 

Concerns for the Ogallala Aquifer 

In Section 3.3 of the E1S, the DOS finds that Keystone is unlikely to adversely impact 

any groundwater or surface water resources. 

11 Execntiye Order 13337,69 Fed. Reg. 25299 (issned April 30, 2004). 

10 
35 

Testimony of Brigham A. McCown 

In Section 4.3.5, DOS concludes that 

construction of the connected projects 

will have minimal impact provided 

normal construction and operational 

practices are followed. DOS finds that -

"(t)housands of miles of pipeline carrying 

crude and refined products traverse 

throughout the region where the Ogallala 

Aquifer is present. Pipelines installed 

within the last 1 0 to 15 years are all 

generally constructed and operated 

under similar regulatory and engineering 

procedures and design as would be 

required of the Keystone XL pipeline." 

(3.3-5) 

November 9, 2011 

The main safety concern that has been voiced by some. is the potential of Keystone 

XL to endanger the Ogallala Aquifer, which provides regional public water supply 

and irrigation water. What is puzzling about this apprehension, though, is that many 

other oil and natural gas pipelines currently traverse the Ogallala Aquifer. In fact. as 

the map here below demonstrates, there are thousands of miles of pipeline already 

crossing the aquifer, and have done so safely for nearly half a century. 

Decades of experience and review demonstrate that the risk to the environment and 

public health from our nation's million miles of pipelines is minimal. That said 

PHMSA regulations specifically address environmentally sensitive areas and require 

heightened standards. Please keep in mind that our country's pipelines live in 

harmony with the environment. The Trans-Alaska system has been safely 

transporting oil above environmentally sensitive areas for decades. Pipelines in the 
36 

Testimony of Brigham A. McCown Page 12 of 16 

marshes of Louisiana and across sensitive areas of Florida are examples of pipeline 

co-existing in the environment in which we live. 

PHMSA environmental regulations also take into account areas containing critically 

imperiled, endangered or threatened species as well as ecological areas utilized 

during assemblage or migratory periods. These factors and more are considered 

during the design and operational phase of a pipeline and moreover, continue to be 

considered during the pipeline's entire Iifecycle. 

VII. Conclusion 

Pipelines are our local, interstate and international energy highways, delivering 

almost two-thirds of all energy products used in the U.S. each year. Keystone will 

only make our national energy highway that much stronger. Furthermore, this 

project would be privately, not publicly, funded, providing direct stimulation to our 

economy without spending federal funds, and without adding to our deficit. 

After reviewing this project and consulting with my former colleagues at PHMSA, I 

am confident that, if approved, this pipeline will offer a level of protection above 

what the law requires and I am satisfied this pipeline will improve the security, 

welfare and safety of our nation as a whole. 

12 
37 

Addendum-A 

TONS SHIPPED Accidents per tons shipped 

TflJd< 64x 6400% 

Rod 4.4x 440!(, 

WIIIO' 13. 1300% 

PlPC'''''' 

TON·MU!I Accidents !Ie' ton· mile 

Truck 496. 4%00% 

5.3. 53O!!t 

""'(If 13.3. 133O!!t 

PtOOhf't\} 

Accidents per tons 

shipped 

Truck 64x 6400% 

Rail 4.4x 440% 

Water 13x 1300% 

. Pipeline 1x n/a 

TON-MILES Accidents per ton-mile 

Truck 496x 49600% 

Rail 5.3x 530% I 

Water 13.3x 1330% 

Pipeline 1x o'a 

Crude Oil and Petroleum Products 

Transported in the United States 

by Mode (billions) 

Pipeline 

Water Carriers 

Motor Carriers 

Railroads 
38 

r estimony of Brigham A. McCown 

2009 

2008 

2007 

2006 

2005 

2004 

2003 

2002 

2001 

2000 

80 

60 

40 

20 

o 

Transportation Accidents by Mode 

o 100,000200,000300,000400,000500,000 

Pipeline Total 

Waterborne 

Total 

Truck (Large) 

Railroad Total 

Accidents Per Million Tons 

Shipped III Pipeline 

III Rail 

1993 1997 2002 

14 

2007 

"'Water 

iii Trllck 

Page 14 of 16 
39 

Testimony of Bligh am A. :\-kCO\\1l 

Accidents per Bmion Ton-miles of 

Freight 

Pipelines \Vater car-riel's Motor carriers Railroads 

NO\"elllber 9. 2011 
40 

r estimony of Brigham A. McCown Page 16 of 16 

Addendum-S 

tiN '-t1M: Crw. Oll.net Petroleum Produeu Jran.~td In tn. unlteCI titatta bl Mod, !OlIlIOn,! 

hIM 1-11 ToMIfiIK of PnvItum 2000 "" "" ,." 1004 , ... - lOO7 

~CIUdt""JIIfroIoumproduc;ta,lOUI • 113 ..... ..... - "" ."" "2.5 I." ..... .,U lR)'51.t 1100 

....... SH.J 57£.1 "'" 500.2 5119.6 001.5 58" 557.1 (R)6CS.7 ,.. .. 

-"""" "" 244.C '''' 240.1 ,." 24C.5 2'31 216.C \g(,Q "" """'''''''''' 313 3C.' ", :tJ2 '" '" 35' 35' '" "' - 10' '59 '" '9.8 '" 232 '" '" 230 '" _'·50; relgm ,. abulatiOn) {611Ion. 

2000 .... "" ... , 1004 .... 92. 910 932 '25 '31 939 - ...' - "" "" "" ,.,.. 910 

--- '" 1l2:.! 611 "'" 0011 .. , ..... 1193 1213 1245 12ti5 1281 1291 "91 "" "04 "'. '429 '''' 1321 '" 

- , ... ,,.. 1606 '604 ,- 1733 ,.,. 1Ii20 '~2 

T ... 2-3: rransporUtion Accidents by Mode 

.... .... ,... '''' "" - ... , - "" -- '" '" ... 013 (R)m nt {R)S4Z '1$ (R)163 

- ...... $,403 '.908 ',001 '" .. " ',W 4,ln ..... ..." ~'!e 4,4541 T,.Jd('~ 431,861 4:)9,312 4'6,411 436,161 399J56 4nO'S 361.920 412.652' 4'2,852 4'2.852 

-- a,,", ..... ... ..... 64" ."' "'" ... m R 4"0 IRll141 

AcdOIntI,. 8iIicNIITIHHMH fA FmgM 2000 ... , "" ,... 1004 "" '000 ... , ....... 0 .• ' 0.11 U. 0.71 '.72 '.71 0.11 , ... - "" ..,. , ... 

-- u .. ... U .. ... .., U 1.1 U 

"""'''''''''' ,., ." n. '" '" '" lIS '" 2ft '" - 4J ... '.a l.1 l.I '.1 U '.0 1.1 2.' 

16 
41 

BRIGHAM A. MCCOWN 

Mr. McCown serves as energy transportation 

infrastructure counsel to both public and private sector 

clients. Mr. McCown has accumulated over 25 years of 

executive, legal and operations management experience in 

areas pertaining to energy, transportation, homeland 

security and the environment. 

He most recently served as the Nation's energy transportation safety 

chief as the first acting administrator / interim chief executive officer and fulltime deputy administrator / chief operating officer of the Pipeline and 

Hazardous Materials Safety Administration (PHMSA) at the U.S. Department 

of Transportation in Washington, DC. In that role, Mr. McCown was 

responsible for the federal government's oversight of the one million 

hazardous materials shipments transported in commerce daily across the 

country by all modes of transportation, including pipeline. During his tenure, 

he was responsible for coordinating the federal government's response to the 

largest oil spill on Alaska's North Slope, oversaw restoration of critical 

national energy infrastructure following Hurricanes Katrina and Rita and 

helped draft the pipeline reauthorization law commonly referred to as the 

PIPES Act. 

Mr. McCown previously served as the Federal Motor Carrier Safety 

Administration's (FMCSA) first general counsel where he was responsible for 

direct legal oversight of the trucking, motor coach and moving industries. His 

work included directly authoring many of the current safety regulations, 

including those pertaining to hours-of-service, driver qualifications and 

training and the agency's compliance review and civil enforcement 

proceedings. Additionally, Mr. McCown was responsible for implementing the 

surface provisions of the NAFTA, for representing the agency before 

legislative and judicial bodies, advised the agency's administrator on all legal 

and enforcement policy issues, and defending the agency in all litigation 

including appearances before the Unites States Supreme Court in the 

landmark environmental law case U.S. Department of Transportation v. 

Public Citizen, 124 S.Ct. 2204, 159 L.Ed.2d 60 (2004). 

In the private sector Mr. McCown has been a member of both 

international and national law firms and his background includes extensive 

litigation expertise defending clients throughout all phases of administrative, 

trial and appellate proceedings. He is a frequent CLE lecturer and published 

legal author, a contributor to National Journal and Forbes, and is also 

regularly quoted by the press in stories concerning energy and transportation 

policy. 

A native of Ironton, Ohio, Mr. McCown graduated from Miami 

University with a degree in Diplomacy & Foreign Affairs. He is also a retired 

Naval Aviator, having served on active duty with the U.S. Navy during 

Operations Desert Storm, Support Democracy (Haiti), and Unified Assistance 

(SE Asia Tsunami). 
42 

Chairman STEWART. Thank you, Mr. McCown. 

Mr. Smith? I am sorry, Mr. Swift. 

STATEMENT OF MR. ANTHONY SWIFT, 

ATTORNEY, INTERNATIONAL PROGRAM, 

NATURAL RESOURCES DEFENSE COUNCIL 

Mr. SWIFT. Thank you. Thank you for today’s opportunity to testify on the environmental issues associated with the Keystone XL 

tar sands pipeline. My name is Anthony Swift. I am an Energy Policy Analyst with the Natural Resources Defense Council. NRDC is 

a national, nonprofit organization dedicated to protecting public 

health and the environment. 

Keystone XL would transport tar sands crude, primarily in the 

form of deluded bitumen through the United States to the Gulf 

Coast where the State Department forecasts most of it will be refined and exported internationally. Diluted bitumen is a mixture of 

bitumen tar sands, which is heavier than water and too thick to 

move by pipeline and light volatile natural gas liquids. Tar sands 

of diluted bitumen differ substantially from the lighter conventional crude historically moved on the U.S. pipeline system. Pipelines moving thick, diluted bitumen operate at higher temperatures 

than pipelines moving less viscous, lighter crudes. 

In the United States, the only area with history moving heavy 

crudes with similarities to tar sands is a small network of pipelines 

in California. Studies of California’s pipeline system show that the 

higher a pipeline’s operating temperature, the higher its spill risk. 

Pipelines operating at temperatures above 100 degrees Fahrenheit 

spilled up to 23 times more often due to external corrosion than 

conventional pipelines. The State Department’s Draft Environmental Review estimated that Keystone XL would operate at between 130 and 150 degrees Fahrenheit. 

The U.S. pipeline system may already be showing the strain of 

moving tar sands. The first imports of diluted bitumen came from 

pipelines in northern Midwest in the late 1990s and have increased 

exponentially since then. Accident reports show that the northern 

Midwestern States moving the largest volumes of diluted bitumen 

for the longest period of time spilled 3.6 times more crude per mile 

than the national average over the last three years. The Enbridge 

mainline, the first pipeline to move significant volumes of diluted 

bitumen into the United States, spilled nearly a million gallons 

into the Kalamazoo River in 2010 after a rupture caused by external corrosion and stress corrosion cracking. In March, the Pegasus 

pipeline spilled over 200,000 gallons of tar sands crude into the 

suburban Arkansas community of Mayflower. This week, another 

spill on the same pipeline was discovered in Missouri. 

We have seen with recent pipelines that special conditions do not 

translate—necessarily translate to safer pipelines. TransCanada’s 

Keystone I and Bison pipelines are examples. Though both carry 

special conditions, the first leaked 14 times in its first year and the 

second exploded. 

In addition to the risk of ruptures, investigators have shown 

major gaps in leak-detection technology and regulations. These 
43 

gaps are most apparent with high-capacity pipelines like Keystone 

XL. According to State, Keystone XL’s real timely detection system 

cannot detect leaks smaller than half-a-million gallons a day. Once 

spilled, tar sands diluted bitumen has proven significantly more 

damaging and difficult to clean than conventional crude, particularly in water bodies. After nearly three years and $1 billion have 

been spent cleaning the Kalamazoo tar sands spill, over 38 miles 

of that river are still contaminated with tar sands. Spill responders 

have found that conventional methods prove ineffective for containing and cleaning tar sands spills. 

In addition to the risk of spills, Keystone XL is a lynchpin for 

tar sands expansion and the climate emissions associated with it. 

Without Keystone XL, tar sands production growth will take a substantially reduced trajectory. North Dakota producers have found 

rail to be feasible and, in many cases, preferable as a transportation option. Late last year, a 200,000-barrel-a-day pipeline proposal was canceled due to lack of interest by North Dakota producers using rail. There is a litany of reasons why rail isn’t feasible 

to supply tar sands production growth. 

The lack of alternatives for Keystone XL has been observed by 

tar sands producers themselves, the financial industry, and Canada’s own Natural Resources Minister. The impact of—tar sands 

would have on U.S. climate emissions is substantial. The Keystone 

XL tar sands pipeline would, if approved, be responsible for at least 

181 million metric tons of carbon dioxide each year, comparable to 

the tailpipe emissions for more than 37 million cars or 51 coal-fired 

power plants. 

The significance of these emissions to global climate change can 

be summed up in this way: if you find your house is on fire, the 

question of how much gasoline you would have to pour on the fire 

to really make a difference given its size is a wrong one to ask, at 

least if your goal is to put the fire out. Tar sands are significantly 

more carbon-intensive than conventional crude, and the choice to 

replace our conventional fuel stock with tar sands is the wrong one 

if we are serious about addressing climate change. Simply stated, 

the Keystone XL pipeline is not in the Nation’s interest. 

NRDC thanks you for the opportunity to present its views, and 

I would be pleased to answer any questions you may have. 

[The prepared statement of Mr. Swift follows:] 
44 

~DC 

Testimony of 

Anthony Swift 

Policy and Energy Analyst, International Program 

Natural Resources Defense Council 

Before the 

Joint Subcommittee on Energy and Environment 

Committee on Science, Space, and Technology 

United States House of Representatives 

May 7, 2013 

1 
45 

~DC Testimony to tbe House of Representative's Committee on Science, Space, and 

Tecbnology's joint Energy and Environment Subcommittee entitled: 

"Keystone XL Pipeline: Examination ofScientilic and Environmental Issues" 

May 7,2013 

Chainnen Loomis and Stewart, Ranking Members Bonamici and Swalwell and members of the 

Committee. thank you for today' S opportlUlity to testifY on the scientific and environmental 

issues associated with the Keystone XL pipeline. My name is Anthony Swift. I am a policy 

analyst for the Natural Resomces Defense COlUlcil (NRDC). NRDC is a nationaL nonprofit 

organization of scientists, lawyers and environmental specialists dedicated to protecting public 

health and the envirolllllent. F ollnded in 1970, NRDC has more than 1.2 million members and 

online activists worldwide, serviced from offices in New York, Washington. Los Angeles. Sall 

Francisco, Chicago. lind Beijing. 

Keystone XL presents unresolved pipeline safety issues 

In early 2011. NRDC raised concems that an influx of tar sands on the u.s. pipeline network 

posed greater lisks to pipeline integrity. challenges for leak detection systems and significantly 

increased impacts to sensitive water resources when spilled. l Observing a lack of due diligcnce 

by industty as it flooded the aging u.S. pipeline system with thick. heavy diluted bitumen tar 

sands and proposed a major expansion of tar sands transport on new pipelines like Keystone XL 

NRDC called on government regulators to identify risks associated with tar sands pipelines aud 

develop safety regulations to address those risks." Since then, evidence has continued acculllulate 

confimling Illany of the cOllccms raised by NRDC infonnation showing thaI pipelines moving 

tar sands are lllore likely to leak, that leak detection systems are Imlikely to detect tar sands 

I NRDC, Tar Sands Pipeline Safety Risks, r ebruary 2011, http:Uwww.nrdc.org/energy/tarsandssafetyrisks.asp. 

'Id. 

2 
46 

spills when they happen, that tar sands spills are significantly more damaging than conventional 

spills, and that conventional spills response measures are inadequate for containing and cleaning 

tar sands spills.l 

Pipeline~ in the U.S. with longest history moving tar sands diluted bitumen also haye worst 

spill record. 

Diluted bitumen has only beenilloved on the U.S. pipeline system since the late 90s and federal 

regulators still don't provide data with the specificity to evaluate thc safety record of pipclincs 

moving tar sands. But a close look at pipeline incident data from states in the northem Midwest, 

which have seen the grcatest volulIles of tar sands diluted bitumen over the longest time period, 

is alanuing. Pipelines in North Dakota, Minnesota, Wisconsin and Michigan spilled 3.6 times as 

much cl1lde per mile than the national average between 20010 and 2012.4 

High temperaturc tar sands pipelines arc at greater risk of leaks. 

Tar sands pipelines operate at higher tempcratures that conventional pipelines and high 

temperature pipelines are more likely to spill due to extemal cOITosion. We know that high 

temperature pipelines are more likely to I1lpture due to cxtemal COlTOSiOIl because a small 

nctwork of pipelines in southcm Califomia has providcd us with an on point case study, 

Pipelines serving the Kem River field in C alifomia have transpolied thick heavy cl1Ides to 

nearby refineries lor sevcral decades. In a ten year study of its pipeline network, Calilomia 

regulators found: 

3 Pipetine and Hazardous Materials Safety Administration (PHMSA), Leak Detection Study - DTPHS6·11·D· 

000001, December 10, 2012, 

http://www.phmsa.dot.gov/staticfiles/PHMSA/DownloadableFiles/Files/Press%20Retease%20FileslLeak%20Detect 

ion%20Study.pdf; Elizabeth McGowan, Lisa Song, The Dilbit Disaster: Inside 1 he Biggest Oil Spill You've Never 

Heard Of, InsideClimate News, July 26, 2012, http://insideclimatenews.org!news/20120626/dilbit.diluted· 

biturl1C?n·enbridge-kalamazoo-rivcr-marshdll-michigan-oll-spi11-6b"pipeline·epa; Anthony Swift, Kalamazoo One 

Year later: Anatomy of a Tar Sands Spill, July 26, 2011, 

http://switchboard.nrdc.org/blogs/aswift/kalamazoooneyearlateranato.htm!. 

4 North Dakota, Minnesota, Wisconsin, and Michigan have 6,416 miles of crude pipeline, or about 12.1 

percent of the U.S. total. PHMSA. State Mileage by Commodity Statistics. 2013. 

primis.phmsa.dotgov/comm/reports/safety/MI_ detaiI1.html?nocache=8335# _ OuterPaneUab_ 4. 

Meanwhile, between 2007 and 2010 pipelines in North Dakota, Minnesota, Wisconsin, and Michigan 

spilled 27,911 barrels of crude in underground leaks, or 40.2% of the 63,987 barrels of crude spilled in the 

United States from 2010-12. Pipeline and Hazardouns Safety Materials Administration (PHMSA), Data 

and Statistics. Crude pipelines 2010-2012, http://www.phmsa.dot.gov/pipelinellibrary/data-stats. 

3 
47 

"Operating temperature had a significant effect on leak incident rates. Generally, tlle 

higher the operating temperature. the higher the resulting incident rate." Califomia State 

Fire Marshalls. Pipeline Risk Assessment. 1993.' 

The Califomia study took into account other factors and found that rcgardless ofpipclille age. 

coating, or pipeline materials. pipelines with higher temperatures had more spills due to exte11lal 

con·osion. 6 This study showed that pipelines operating above lOO°F were had a higher incidence 

of l1Iptures due to external cOITOsion. 7 Pipelines operating at in the range of 130°F to 159°F were 

nearly 24 times more likely to leak due to extemal cOHosion and six times more likely to leak 

ii'om any calise than pipclincs opcrating undcr 70°F8 III its draH Supplemental Environlllcntal 

hllpact Statement (SEIS). State indicated that Keystone XL will operate at a temperatme range 

between 130°F and 150°F.9 

This is not a new issue. Enhridge's tar sands spill into the Kalamazoo River in 2010, resulting in 

the largest and most expensive onshore pipeline accident in U.S. history. was caused by extcmal 

corrosionw Moreover, much of En bridge's line 6B. which was one of the first pipelines to move 

significant volumes of tar sands diluted bitumen into the United States, had to be replaced due to 

hundreds of corrosion abnonllalities. NRDC highlighted the risk of extemal cOlTosion on high 

temperature diluted bitumen tar sands pipelines in conmlents to U.S. pipeline regulators in early 

2011. 11 And yet industry's silence on the general risk of high temperature tar sands pipelines 

and extemal cOHosion speaks volumes. 

S California State Fire Marshalls, Pipeline Risk Assessment, 1993. Pg. 68, 

h!tp;/losfm.fire.ca.gov/pipeline/pdf/publication/pipelineriskassessment.pdf 

·Id. 

'Id. 

Sid. 

• State Department, Keystone XL Draft Supplemental Environmental Impact Statement, May 1, 2013,4.13-22 

htlP:/Ikeystonepipeline-xl.state.gov/documents/organizationI205621.pdf. 

10 National Transportation Safety Board, Enbridge Incorporated Hazardous liquid Pipeline Rupture and Release, 

July 10, 2012, http:Uwww.ntsb.gov/news/events/2012/marshallmi/index.html. 

UNaturat Resources Defense Coundl et. aI., Comments to the Office of Pipeline Safety In response to the Advanced 

Notice of A'oposed RJlemaking Titled" Safety of O1-91ore Hazardous Uquid Apelines" , February 18, 2011, 

http:Uswitchboard.nrdc.org/blogs/sclefkowitz/NRDC%20et%2Oal%20Comments%20Proposed%20Rutemaking%20 

On-Shore%20Hazardous%20Uguid%20Pipelines%20Feb%2018%202011%20rev.pdf. 

4 
48 

Leak detection systems miss 19 out of 20 spills. 

In Tar Sands Safety Risks, NRDC identified a higher risk of false alanns for leak detection 

systems in pipelines moving diluted bitumen tar sands. Ie And indeed. the National 

Transpoliation Safety Board's investigation of the Kalamazoo tar sands spill found that a 

seventeen hour delay from the time of the rupture and their final shutoff of the pipeline was due 

to the belief by Enbridge' s control center that the leak detection system was giving a false 

alal1ulJ 

However, several new repolis suggest that pipeline leak detection systems are far blunter 

instnunellts than many operators care to admit. An investigation of pipeline accideut reports 

from the last ten years shows that leak detection systems miss 19 out of 20 Spills.I-I This problem 

isn't limited to small spills these systems also miss 4 out of 5 spills greater than 42.000 bpd. l

; 

A Congressionally mandated study of leak detection systems by federal regulators at the Pipeline 

and Hazardous Materials Safety Administration identified major gaps in leak detection systems 

and U.S. regulations. 16 

COllllllunities have a right to be concemed by the poor slate ofleak detection technology as they 

face industry proposals to move tar sands in new or aging pipelines - particuillriy olles that 

transverse sensitive water resource. 

Tar sands diluted bitumen spills are more damaging and difficult to clean. 

The 2010 Enbridge tar sands spill into the Kalamazoo River highlighted an il1dllStlY that was 

unprepared to address the lUlique challenges associated with tar sands diluted bitumen spills. 

Nearly three years after Enbridge spilled a million gallons of tar sands cl1lde into the Kalamazoo 

12 NRDC, Tar Sands Pipeline Safety Risks, February 2011, http://www.nrdc.org/energy/tarsandssafetyrisks.asp. 

13 National Transportation Safety Board, Enbridge Incorporated Hazardous liquid Pipeline Rupture and Release, 

July 10, 2012, http://www.ntsb.gov/news/eventsI20l2/marshallmi/index.html. 

14 lisa Song, Few Oil Pipeline Spills Detected by Much·Touted Sensors, InsideClimate News, Sept. 19, 2012, 

http://www.bloomberg.com/news/2012-09-19/oil-pipeline-spills-go-undetected-by-much-touted-sensors.html. 

"Id. 

16 Pipeline and Hazardous Materials Safety Administration (PHMSA), leak Detection Study -DTPH56·11·D· 

000001, December 10, 2012, 

http://www.phmsa.dot.gov/staticfiles/PHMSA/DownloadableFiles/Files/Press%20Release%20Files/leak%20Detect 

ion%20Study.pdf. 

5 
49 

River watershed and almost a billion dollars has been spent on cleanup, and 38 miles of til at river 

are still contaminated. 17 

Tar sands diluted bitumen is a mixture of VeIY light petrochemicals and velY heavy bittUuen. 

Once spilled in a waterbody. the light petrochemicals incilldin!J. toxins such as benzene and 

toluene - gas off, leaving the heavy bitumen to sink-IS During the Enbridge tar sauds spill in 

Kalamazoo, Michigan. significant voltunes of heavy cl1Ide sank below the water's surface and 

traveled along the river bed. 19 EPA's on-site spill coordinator l'vlark Dlll1l0 described the uniqlle 

nature of the spill: 

"Where we thought we might be winding down our piece of the response, we're actually 

ramping back up. The submerged oil is a real stOIY -- it's a real eye-opener. ... In larger 

spills we 've dealt with before. we haven't seen nearly this footprint of submerged oil, if 

we've seen any at all."20 

In another interview, rvIr. Dumo ohselved: 

"This was the first time the EPA or anyone has done a submerged cleanup of this 

magnitude. I would never have expected ... that we would have spent two or three times 

longer workin!J. on the submer!J.cd oil than snrface oil. I don't think anyone at the EPA 

anticipated that, I don't think anyone at the state level anticipated that. I don't think 

anyone in industry anticipated that. ,,21 

17 ErA, In the Matter of En bridge Energy et. aI., Order for Removal Under Section 311(c) of the Clean Water Act, 

October 3,2012, http://www.epa.gov/enbridgespill/pdfs/20121003-proposed-order-for-removal.pdf. 

lB lisa Song, A Dilbit rrimer: How It's Different from Conventional Oil, InsideClimate News, June 26, 2012, 

http://insidedimatenews.org!news/20120626/dilbit-primer-diluted-bitumen-conventional-oil·tar-sands·AlbertaKalamazoo-Kevstone-XL -E nbridge. 

" Elizabeth McGowan, lisa Song, The Dilbit Disaster: Inside The Biggest Oil Spill You've Never Heard Of, 

InsideClimate News, July 26,2012, http://insideclimatenews.org/news/20120626/dilbit-diluted-bitumen-enbridgej<oalamazoo-river··marshall-michigan-oil-spill-6b-pipeline-epa. 

20 Anthony Swift, Katamazoo One Year later: Anatomy of a Tar Sands Spill, July 26, 2011, 

http://switchboard.nrdc.org!blogs/aswift/kalamazoooneveariateranato.htm!. 

21 Mitchell Anderson, Spill from Hell, The Tyee, March 5, 2012, http://thetvee.ca/News/2012!03/0S/DilutedBitumen!. 

6 
50 

One could argue that companies planning to move billions of balTels offar sands across sensitive 

water resources by pipeline should have done due diligence before moving ahead. It is much 

harder to defend the fact that over two years after the Kalamazoo tar sands spilL neither industry 

nor regulators have evaluated the risks posed by diluted bihullen spills to the environment or 

developed measures to mitigate those 11sks. 

Conventional spill response methods have proven ineffective for tar sands diluted bitumen 

spills. 

During the Kalamazoo tar sands spill, conventional c1emmp methods failed. and in some cases 

made the spill worse. 22 EPA officials were forced to improvise. using extreme measures to 

recover oil from riverbeds and the nearby MOlTow Lake. 23 The spill cleanup cOlltinues. but now 

EPA officials have focused on ensure new areas are not contmninated. concluding that it would 

be too damaging to fully clean the nearly 40 miles of the Kalamazoo River that are already 

contaminated by tm' smlds. 2~ 

Over two years ago. NRDC called for an evaluation of the risks of tar sands spills and improved 

spill response planning for diluted bitumen spills ill close consolation with locate emergency 

response teams and community. UnfOliunately. neither regulators nor indushy has made progress 

ill evaluating or addressing the risks caused by tar sands spills. The extent of dmnage done to the 

region's watershed lllay not be known for years to come. Michigan State University Biologist 

Stephen Hmllilton concluded: 

"Usa Song, Cleanup of 2010 Mich. Dilbit Spill Aims to Stop Spread of Submerged Oil, InsideClimate News, March 

27,2013, http:Uinsidedimatenews.org!news/20130327/deanup-2010-mich-difbit.spill-aims·stop-spread. 

submerged-oil. 

23 Anthony Swift, Katamazoo One Year later: Anatomy of a Tar Sands Spit!, July 26,2011, 

http:Uswitchboard.nrdc.org!blogs/aswift/kalamazoo one year later anato.htm!. 

24 EPA, In the Matter of Enbridge Energy et. aI., Order for Removal Under Section 311(c) of the Clean Water Act, 

October 3, 2012, http:Uwww.epa.gov!enbridgespitl/pdfsI20121003·proposed-order-for-removal.pdf. 

7 
51 

"This kind of cmde oil is a complex mix of hundreds of compolmds-some knoW11 to be 

toxic-that has not been studied much. We just don't understand the consequences well 

cllou!J.h.,,7j 

Keystone XL is critical for tar sands expansion and associated climate emissions 

The Keystone XL tar sauds pipeline is a lynchpin for the expansion of the tar sands bitumen 

production in Canada. On this point. market analysts. voices in the Albertan tar sands industry. 

and the environmental community agree. Industry's plan to triple tar sands production by 2030. 

and the Si!J.llificant environmental impacts associated with that plan. camlOt take place without 

the approval of the Keystone XL tar sands pipeline as a major avenue to the needed new markets 

for tar sands cmdc. c6 

Altemative pipeline and rail tar sands transpoI1ation proposals will not allow for the same level 

of tar sands production expansion and the associated climate emissions as the Keystone XL 

pipeline. As analysts at the CIBC bank in Canada have observed. tar sands oil producers in 

Albelta need evelY proposed tar sands infrastructure project - including Keystone XL - to move 

forward in order to meet industry production expansion goals. 21 For the following reasons, many 

of these proposed tar sands transpoltation projects are unlikely to move forward. 

Pipelines to the west and east coasts are stalled by entrenched public and First Nations 

opposition.c8 Many of these proposals will require the use of aging pipelines to move tar sands 

through connllullities and sensitive watersheds. 29 After the 11lpture of the Pegasus pipeline in the 

"David Hasemeyer, EPA Worries Dilbit Still a Threat to Kalamazoo River, More Than 2 Years After Spill, 

InsideClimate News, October 12, 2012, http://insideclimatenews.org!news!2012101l/epa-dilbit-enbridse-6b· 

pipeline~kalamazoo~river ·cleanup·tar ·sa nds-oi I-sa nds-keystone-xl-Iandowners-environment ?page=3. 

"Canadian Association of Petroleum Producers (CAPP), Crude Oit, Forecasts, Markets and Pipelines, June 2012, pg. 

38, http://www.capp.ca/forecast/Pages/default.aspx. 

21 \lMderkJippe. NathCl"l. "Gut of Cheap Qude Rlise [k)ubts <Ner 01 Smds Eicpansion: Gobe and Mail 17 August 

2012. http:Uwww.theglobeandmail.com/globe-investor/pipelines-glut-of-cheap-crude-raise-doubts-over.oilsands-expansion/article4485891/. 

,. Nathan Lemphers, The Climate Impacts of the Proposed Keystone Xl Oilsands Pipeline, January 17, 2013, pgs. 8-

9, http://www.pembina.org/pub/2407. 

'"The proposed reversal of the Fbrtland Montreal pipeline through New Ei1g1and CI"Id TransCl1ada'sconversion of 

its natural gas pipeline system through its east coast both require the use of pipeline systems which are over fifty 

years old. 

8 
52 

Arkansas comlllunity of Mayflower. the risks of these projects is becoming lllore apparent to the 

communities they would cross. 

In its most recent draft supplemental environmental impact statement, while the State 

Department acknowledged that tar sands is significantly more carbon intensive over its lifecyele 

than conventional cmde, the agency mistakenly suggested that rail could provide an 

economically feasible alternative to Keystone XL. 30 

The State Department made the prediction that tar sands by rail was on the verge of rapid 

expansion in2011.J1 State's forecast proved inaccurate then and its 2013 forecast on the viability 

of rail continues to be substantively flawed. 

A recent investigation by Reuters has debunked the State Depaltment's argmuent that industty' S 

expansion plan lor tar sands production, and the substantial climate emissions associated with it. 

can be fueled by rail if Keystone XL is r~jected. J2 Reaching out to many o[the same industty 

sources the State Depaltment cited in its draft Supplemental Enviro!Ullelltal hupaet Statement 

(SEIS), the Reuters investigation demonstrates the etTors in State's analysis that led it to 

dramatically overstate the potential of rail to move tar sands. 33 

State's prediction that 200,000 bpd of heavy Canadian tar sands would reach the Gulfby rail by 

the end of the year was based OIl a misinterpretation of industIy data, according' to the sources 

that State cited. As the Reuters stolY reported: 

"The State Dcpru1ment report cites two indllslly studies to predict that 200,000 batTels a 

day or more o[Canadian heavy cmdc oil will reach GlllfCoast refiners by train by the 

'" The State Department found that the crudes expected to be transported on Keystone XL were likely to be up to 

19 percent more greenhouse gas intensive on a well-to-wheel basis when compared to reference crudes. State 

Department, Draft Supplemental [nvironmentallmpact Statement, App<mdix W: Ufc"Cyc1e Greenhouse Gas 

Emissions of Petroleum Products from WCSB Oil Sands Crudes Compared with Reference Crud"s, pg. 60, March 1, 

2013, bttp:l!keystonepipeline-xl.state.gov/documents/organization/205563.pdf. 

31 EnSys, Keystone XL . No Expansion Update, August 12, 2011, pgs. 52-53, 75, www.keystonepipelinexl.state.gov/documents/organization/182263.pdf. 

"Palrick Ruckers, Analysis: Oil·by-train may not be substitute for Keystone pipeline, Reuters, April 18, 2013 

http://www.reuters.com/articleI2013!04/18!us-usa-keystone-raiIroads-idUSBRE93H07120130418. 

" Patrick Ruckers, Analysis: Oil-by·train may not be substitute for Keystone pipeline, Reuters, April 18, 2013 

http://www.reuters.com/artide/2013/04/18!us-usa·keystone·railroads-idUSBRE93H07120130418. 

9 
53 

end of this year. Officials used that figme to bolster their argmuent that the oil industry 

has already decided rail is a good option for moving oil sands cmde. 'Limitations on 

pipeline transport would force more cllIdc oil to be transp0l1ed via other modes of 

transportation, such as rail, which would probably (but not celtainly) be more expensive, ' 

the State Department said."l' 

TIle repol1 goes 011 to show that State's illduSlIy sources disagree: 

"But one of the sources for the 200,000 barrels per day estimate, CalgalY inveslIllellt 

bank Peters & Co, says its forecast was misunderstood as being forjllst Gulf Coast-bound 

oil when it included shipments to Eastem Canada and other refiners. 'We haven't lI'acked 

exactly where those ball'els are going,' said Tyler Reardon, a spokesman for Peters & 

Co.")) 

Where that 200,000 bpd is likely to go and whether its light or heavy is velY important. Keystone 

XL would bring heavy tar sands frolllnorthern Albelta to the Gulf Coast where refineries have 

the equipment to handle heavy cmde. Refineries in the East Coast of the United States and 

Canada only have a velY limited capacity to process heavy cl1lde -' totaling less than a qllal1er of 

the potential volume of Keystolle XL 

The key question is whether it's economically feasible to move heavy tar sands cl1lde to the Gulf 

Coast refineries by rail. The answer appears be no. In a year when Gulf Coast prices for heavy 

Canadian tar sands were up to $50 a banel higher than those in the Midwest, heavy Canadian 

cmde movements to the Gulf by rail only increased froIU 15.000 bpd to 25,000 bpd between 

2011 and 2012 still a fraction ofa percent oftotal prodlIctionJ6 

The relative lack of tar sands cmdc moving. by rail contrasts with a signilicant increase in the 

movement of light cmde fr0111 N0I1h Dakota by raiL From 2009 to 2013, transpol1 of oil by rail 

34 ld. 

" Id. 

>6 ld. 

10 
54 

in North Dakota increased from a few thousand barrels a day to over half a millionF In January 

2013, over two thirds of light crude produced in North Dakota was transported to refineries by 

rail, l8 As they tumed to raiL domestic light oil prodncers have even rejected major pipeline 

proposals - including Oenok's 200,000 barrel per day Bakken pipeline39 When analysts talk 

abont the upsurge of rail transport in the United States and sonthem Canada, this is what they're 

referring to an enomlOUS expansion of light cmde from the Bakken, 

There are two major reasons why tar sands prodllcers haven'l Illmed to rail to move their prodllcl 

to market First, it is significantly more expensive for them to do so. and second, they have 

significantly tighter profit margins than Bakken producers. 

Tar sands diluted bitumen is significantly more expensive to move by rail than Bakken light 

cmde. There are a number of reasons for this: 

The tar sands are about 1,000 miles farther away from refinelY markets than the Bakken 

oil fields. 

Trains moving light cmde can carry nearly 30% more cl1lde than trains moving heavy tar 

sands diluted bitumen40 

Moving tar sauds requires specialized rail omoading tenllinals, ollioading teJ1uillals and 

heated rail cars.41 

All ofthcsc factors increase the cost of moving a bamll of tar smuts to Gulf Coast refineries. 

Shipping a banel of tar sands diluted bitulllen to the Gulf is currently costing tar sands producers 

S3l a barre!.42 Moving it by pipeline only costs $8 to $9.50 a balTel.4l 

37 North Dakota Pipeline Authority, U.s. Williston Basin Rail Export Estimates, April 1, 2013, 

http://ndpipelines.files.wordpress.com12012/04/ndpa-website·data13.xlsx. 

,. Justin Miller, Wayzata firm to expand N.D. rail terminal for Bakken crude oil, Star Tribune, March IS, 2013, 

http://www.startribune.com/business/198551531.html?refer=y. 

39 Chicago Tribune, Oenoek Update 1: Cancels 200,000 bpd Bakken Project, Nov. 1, 2012, 

http://articles.chicagotribune.comI20 12-11-2 7/news/sns-rt -oneok·bakkenpipeline-u pdate-111 e8mrbzd· 

20121127 1 overland-pass.pipeli ne-bakken ·crude-express·pi peline·oneok -partners·lp. 

40 light crude train cars can move up to 700 barrels while heavy train cars can only move 550 barrels. Doug Wilkins, 

Integated Midstream 9:llutions, ID S:lcurities 'o-ude ~ Rail Forum, pg. 11, O::tober 2, 2012. 

" Id. 

11 
55 

Tar sands producers also have much tighter margins than conventional Bakken producers. Tar 

sands cmde is a lower valuc commodity than Bakken light cmde. In addition, it has signiflclUltly 

higher production prices. With breakeven production costs ranging ii-om $60 a banel to over 

5100 a banel and increasing by each year new tar sands projects cannot profitably bear 

significantly greater transportation costs associated with rail. 44 

The fact that the rejcction of Keystone XL would reduce tar sands production is llcknowledged 

by Canadillll officials. Joe Oliver, Canada's Natural Resources Minister. recently observed that 

costs and logistical challcn!!es make moving tar sands by rail a poor choice for producers, Bolin!! 

that a rejection of Keystone XL would put a dent in tar sands production. 4; 

Market analysis by The Goodman Group (TGG) also identified flmdamental Haws in the llnalysis 

thllt led State to conclude that Keystone XL would have limited impact on tar sands production 

and the climate impacts llssociated with it. 46 TGG concluded that State's draft environmental 

review "is deeply Hawed and not a sound basis for decision-making.,,47 Based on its analysis. 

TGG concludes "that KXL and specifically its impact on tar sands logistics costs and crude 

prices. will have a significant impact on tar sands expansion under a very broad range of 

conditions and assumptioIls.,,4S TGG stated that a conservative and credible estimate of Keystone 

42 Nicole Mordant, Analysis: Crude-by-rail carves out long-term North American niche, Reuters, Nov. 4, 2012, 

http://www.reuters.com!article!2012!11!04!us-railways-oil-northamerica-id USBRE8A30AX201211 04. 

43 State Department, Supplemental EIS, Market Analysis, 1.4-49, 50, March 1, 2013. 

44 Energy Conservation Resources Board, ST98-2012 Alberta's energy R!!serves 2011 and Slpplyl Demand Qrtlook 

2012-2021, pg. 3-30, line 2012; F\!mbina Institute: J:r1uary 28, 2013" Beneath the Slrface" Report (Pg. 57) 

http://www.pembinaorgpub!2404; Katusa, Marin. "01 Rice Offerentials: Clught Between the 9lnds and the 

Apelines." Forbes 6 June 2012. Web. http://www.forbes.com/sites/energysource/2012/06/21/0il-pricedifferentials-caught-between-the-sands-and-the-pipelines131 "Patrick Ruckers, Crude.by-rail no substitute for Keystone Xl - Energy Minister, Rueters, April 24, 2013, 

http://www.reuters.com!articie/2013/04124/usa-keystone-rail-idUSL2NODB23P20130424. 

46 Ian Goodman, Report evaluating the adequacy of the Keystone XL (KXL) Draft Supplementat Environmental 

Impact Statement (DSEIS) Market Analysis, April 22, 2013, Section 7.0, 

http://switchboard.nrdc.org/blogs/aswift!Comments%20of%20Sierra%20Club%2C%20et.%20al.%2C%20on%20the 

%20Keystone%20XL%20DSEIS.4.22.13.pdf. 

"Ian Goodman, Report evaluating the adequacy of the Keystone XL (KXL) Draft Supplemental Environmental 

Impact Statement (DSEIS) Market Analysis, April 22, 2013, Section 7.0, 

http://switchboard.nrdc.org!blogs/aswiftfComments%20of%2OSierra%20Club%2C%20et.%20al.%2C%20on%20the 

%20Keystone%20XL%20DSEIS.4.22.13.pdf. 

,sld. 

12 
56 

XL's impact on tar sands expansion would be 830,000 bpd based Oil its evaluation of Clm'ent 

market conditiolls.49 

Keystone XL is a linchpin for tar sands production and associated climate emissions 

Infrastructure is needed for tar sands expansion, and it is clear to most observers that the pennit 

decision for Keystone XL plays a critical role in the fhture of tar sands production and the 

greenhouse gas emissions associated with it. The Keystone XL tar sands pipeline is a 

fundamental element in the oil industry'S plan to triple production of tar sands oillI-olll 2 million 

ban-els per day (bpd) to 6 million bpd by 2030, and in the longer tel111 to hike production to more 

than 9 million bpd.io The U.S. decision on whether to approve the Keystone XL pipeline will 

have a direct bearing on whether the tar sands indusby can attain those goals. with their attendant 

increases in carbon pollution. Keystone XL would lock the U.S. into a 10ng-tel111 COIlllllibllent to 

an energy infrastmcture that relies on dilty oil. 

Producing: tar sands generates at least three times as much carbon as conventional cmde. The 

Environmental Protection Agency (EPA) estimates that simply replacing the conventional cmde 

with tar sands fi-mn Keystone XL would increase U_S. carbon emissions by as much as 935 

million metric tons C02C during the pipeline's 50 year lifespan51 A recent report evalnating the 

project's total carbon emissions shows that Keystolle XL would be responsible for at least 181 

millionllletric tOilS of carbon dioxide C COle of emissions each year. comparable to the tailpipe 

emissions from more thall 37.7 millioll cars or 51 coal-fired power plants. ,2 The first step in 

addressing climate change is to stop making the problem worse - and that means rejecting the 

Keystone XL tar sands pipeline and the higher carbon emissions associated with it. 

·'Id. 

50 NRDC, Climate Impacts from the Keystone Xl Tar Sands Pipeline, February 8, 2013, 

http://switchboard.nrdc.org/blogs/ddroitsch/FINAl%20NRDC%20Keystone%20Xl%20climate%20impacts%20mem 

o%20Feb%208%202013.pdf. 

51 Cynthia Giles, Environmental Protection Agency, April 22, 2013, http://epa.gov/compliance/nepa/keystone-xlproject-epa-comment-letter-20130056.pdf_ 

52 Oil Change International, Cooking the Books: How the State Department Analysis Ignores the True Climate 

Impacts of the Keystone Xl Pipeline, April 16, 2013, http://priceofoil.org/2013/04/16/cooking-the-books-the-truedimate-impact-of-keystone-xl/. 

13 
57 

The substantial risks of the Keystone XL tar sands pipeline outweigh its marginal benefits. 

Keystone XL would enable a substantial expansion of tar sands expansion and substantial 

climate pollution associated with it. The pipeline would elldanller critical jobs on ranches and 

farms in the Great Plains states in order to transport tar sands to the Gulf Coast where it can be 

refined and exported. In exchange for 35 pCllnanent jobs, Keystone XL wonld pose a penllallent 

risk to American conlUnmities, sensitive water resources and agricultm'al industry. 53 We need to 

protect those jobs, not put them at risk of the kind of tar sauds blowout that has poisoned nearly 

40 miles ofthe Kalamazoo River in Michillan or the recent spill ill Arkansas, which sen! up to 

420,000 gallons of tar sands oil flowing tlll'ough the comnumity of Mayflower. 5. 

The Keystone XL tar sands pipeline would undemline U.S. etIorts to reduce its carbon 

emissions, threaten cOlIuuunities and sensitive water resources, and increase refinelY emissions 

in the Gulf Coast in order to provide tar sands producers a means of exporting their product on 

the intemational market. Tins tradeoff is not in the nation's interest TransCanada's application 

to build the Keystone XL pipeline should be rejected. 

"State Department, Draft Supplemental Impact Statement Executive Summary, pg. 13-14, March 1, 2013. 

S< National Response Center, Report 104298, March 30, 2013, 

http://www.nrc.uscg.mil/reports/ rwservlet ?standard _ web+inc _ seq= 1042498. 

14 
58 

Anthony Swift, Energy and Policy Analyst, Natural Resources Defense Council Biography 

Anthony Swift, Attorney at the Natural Resources Defense Council (NRDC), works for NRDC's 

international program on a variety of energy related issues relating to subsidies, petroleum markets, 

import and export issues, federal environmental review processes, pipeline regulatory issues and carbon 

intensive transportation fuels. He also works with U.S. and international coalitions opposing the 

expansion of tar sands production and proposals to build the Keystone XL, Northern Gateway and 

Trailbreaker tar sands pipelines. Anthony has testified before the U.S. House of Representatives' Energy 

& Power subcommittee on pipeline safety oversight and transportation constraints for tar sands, 

Canada's National Energy Board (NEB) on Enbridge's Northern Gateway pipeline proposal, the Nebraska 

Senate on pipeline siting issues, and the National Academy of Sciences on risks posed by diluted 

bitumen to pipelines. Prior to working at NRDC, Anthony worked as a policy analyst for the Department 

of Transportation where he worked on alternative fuels, efficiency standards and the National 

Environmental Policy Act review process. He has a law degree from the University of Pennsylvania and a 

B.A. in Biology and Political Science from Austin College. 
59 

Chairman STEWART. Thank you, Mr. Swift. 

And now, our final witness, Mr. Knappenberger. 

STATEMENT OF MR. PAUL KNAPPENBERGER, 

ASSISTANT DIRECTOR, CENTER FOR THE 

STUDY OF SCIENCE, CATO INSTITUTE 

Mr. KNAPPENBERGER. Good morning. Chairman Stewart, Chairwoman Lummis, and other distinguished Members of the Subcommittee, I thank you for the opportunity to offer testimony this 

morning. I am Paul Knappenberger, Assistant Director of the Center for the Study of Science at the Cato Institute, a nonprofit, nonpartisan public policy research Institute located here in Washington, D.C. 

Before I begin my testimony, I would like to make clear that my 

comments are solely my own and do not represent any official position of the Cato Institute. 

Climate change results from a variety of factors, both human and 

natural. The primary concern raised over the pipeline involves the 

carbon dioxide emissions that will result from the production and 

use of the oil that the pipeline will carry. In its Supplemental Environmental Draft—Environmental Impact Statement, the State Department finds—and I think that there is broad agreement on this 

point—that a barrel of oil produced from the Canadian tar sands 

carries about a 17 percent carbon dioxide emissions premium compared to the average barrel of oil finding its way into the U.S. market. 

Now, the disagreement between the State Department, the Environmental Protection Agency, and several environmental groups involves how many new carbon dioxide emissions this 17 percent premium results in when it is applied to the 830,000 barrels of oil that 

the pipeline will carry each day. The State Department concludes 

that the economy of the tar sands is such that it will come to market one way or another whether or not the Keystone XL pipeline 

is ever built. It thus finds virtually no additional carbon dioxide 

emissions resulting from the project. 

The EPA contends that the State Department is too quick to 

reach such a conclusion. The EPA argues that without the pipeline, 

much of the oil will remain in the ground, and thus, while the existence of the pipeline won’t result in more oil being used in the 

United States, it will result in a 17 percent emissions premium on 

the pipeline’s portion of that oil. The EPA gives this extra amount 

as 18.7 million metric tons of carbon dioxide per year. 

And several environmental organizations take the viewpoint that 

while the pipeline may not increase the amount of oil used in the 

United States, the oil that it displaces from the U.S. market will 

be consumed by other countries as the global demand for oil continues to grow. They calculate that the pipeline will result in about 

181 million metric tons of additional carbon dioxide each year. 

So in these terms, the differences among the groups appear large 

and contentious, and much of the protestation involving the Keystone XL pipeline focuses on these emissions numbers. But these 

protests are largely misplaced. It is imperative to keep in mind 
60 

that the endgame is climate change, and carbon dioxide emissions 

are not climate change. They influence climate change but they are 

not a measure of it. Therefore, before any type of assessment as to 

the potential climate impact of the pipeline can be made, it is essential to translate carbon dioxide emissions into some sort of climate unit, like the global average temperature change. In other 

words, how much global warming will the pipeline produce? Isn’t 

that what everyone wants to know? 

Now, why is it then that such numbers are absent in the discussions of the impacts of the pipeline? It is not as if there is no good 

way of calculating them. This is precisely what climate models are 

designed to do. Climate models emulate the Earth’s climate system 

and allow researchers to change various influences upon it, such as 

adding additional carbon dioxide emissions, and then seeing what 

happens in the computer simulations. 

So why haven’t they been applied to predict the climate impact 

of the pipeline? Because if they were, the answer would be exceedingly tiny. For example, using a climate model emulator that was 

developed under support of the EPA, I find that in the case of the 

State Department’s analysis, as there are very few additional carbon dioxide emissions resulting from the pipeline, there are essentially—there is essentially no associated climate change. Under the 

EPA’s assumptions, the average temperature rise works out to less 

than 0.00001 degree C per year. That is 1/100,000 of a degree. 

And even under the assumption that all the Keystone XL oil was 

additional oil in the global supply, the extra warming is still less 

than 1/10,000 of a degree per year. In other words, if the pipeline 

were to operate at full capacity for the next 1,000 years, it would 

raise the global average temperature by less than 1/10 of a degree. 

It is this kind of information, not information on carbon dioxide 

emissions, that is required to properly assess the climate change 

aspect of this or any other proposed project or regulation. In these 

terms, the difference between the State Department’s Environmental Impact Statement and those of its critics all but vanished. 

No matter whose carbon dioxide emissions estimate is used, the climate impact of the oil transported by the pipeline is too small to 

measure or carry any physical significance. In deciding the fate of 

the Keystone XL pipeline, it is important not to let symbolism 

cloud these facts. 

Thank you very much. 

[The prepared statement of Mr. Knappenberger follows:] 
61 

WRITTEN STATEMENT OF 

PAUL C. KNAPPENBERGER 

ASSISTANT DIRECTOR 

CENTER FOR THE STUDY OF SCIENCE 

CATO INSTITUTE 

WASHINGTON, DC 

JOINT HEARING ON 

KEYSTONE XL PIPELINE: 

EXAMINATION OF SCIENTIFIC AND ENVIRONMENTAL ISSUES 

BEFORE THE 

U.S. HOUSE OF REPRESENTATIVES 

COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

SUBCOMMITTEE ON ENERGY 

AND 

SUBCOMMITTEE ON THE ENVIRONMENT 

MAY 7,2013 
62 

I am Paul C. Knappenberger, Assistant Director of the Center for the Study of Science at the 

Cato Institute, a nonprofit, non-partisan public policy research institute located here in 

Washington DC, and Cato is my sole source of employment income. Before I begin my 

testimony, I would like to make clear tllat my comments are solely my own and do not represent 

any official position of the Cato Institute. 

For the past 25 years, I've condncted research on topics of climate and climate change including 

hurricanes, heat-related mOltality, and temperauu'e trends as well as worked to quantif'y the 

projections of human-caused climate change. 

This last topic, specifically how it relates to the proposed Keystone XL pipeline, will be the 

subject of my testimony. 

When I refer to climate change in these remarks, I am specifically referring to that climate 

change which may occur as a result of Inunall emissions of gl'eenhouse gases, primarily carbon 

dioxide. Climate change may (and does) occur from other influences as well, both hurnan and 

natural. But the prinl3ry concern raised over the Keystone XL pipeline involves tIle carbon 

dioxide emissions resulting fi'om ilie burning of ilie oil that the pipeline will can)'. So it is the 

potential climate change from these emissions that will be foclls of my testimony. 

In its Draft Environmental Impacts Statement (DEIS), the State Department has done a good job 

in qnantif'ying the extra emissions that result from the extraction, transportation, refining, and 

evenul3l end use of the oil which will be transpOlted by the Keystone XL pipeline. They fmd. 

and I think that there is broad agreement on this point, that a banel of oil produced from the 

Canadian tar sands I!3s abont a 17 percent carbon dioxide emissions premium compared to the 

average banel of oil fmding its way into the U.S. market. 

The emissions premilml primarily arises fi'om the relatively energy-intensive malll\er in which tar 

sands oil is clll1'ently extracted. In the DEIS, the State Department points Ollt that this emissions 

premiwn may well sln'ink over time as new extraction methodologies are developed, as 

extraction in other regions, such as Saudi Arabia, becomes more energy intensive, or depending 

on the type of oil that is ultimately displaced by the oil catTied by the Keystone XL pipeline. 

The disagl'eement between the State Department, the Environmental Protection Agency, and 

several environmental groups, involves how many new carbon dioxide emissions tIus cunent 17 

percent per banel premium results in when applied to the 830,000 bmTels of oil that the 

Keystone XL pipeline will carry each day when operating at full capacity. 

The State Department concludes that the demand for the tm' satlds oil is great enough that it will 

come to market whether or 110t the Keystone XL pipeline is ever built. It tIms finds vel)' few 

additional carbon dioxide emissions resulting from the pipeline project-somewhere in the range 

of 311 additional 0.1 to 5.3 million metric tons of em'bon dioxide emissions per yem' over the case 

where the pipeline is not built. 

2 
63 

The EPA contends that the Stale Department is too quick to come to such a conclusion. The EPA 

suggests that without the pipeline, much of that oil will remain in the grOlUld. Therefore. if the 

pipeline were to be built. oil would be produced from the tar sands to meet its capacity. While 

tllis won't result in more oil being used in the U.S., it will result in a 17 percent carbon dioxide 

emissions premium applied to the 830,000 barrels per day of delivered oil. The EPA cites an 

extra 18.7 nlillion metric tOilS of carbon dioxide emissions per year over the situation of no 

pipeline. 

Several envirolllllental organizations take the view that while the Keystone XL pipeline may not 

increase the amOlUlt of oil used in the U.S., the oil that it displaces fi'om the U.S. market will be 

consumed by other countries as the global demand for oil continues to grow. Thus, they calculate 

the full emissions from the 830,000 barrels per day plus the 17 percent emissions premium, and 

arrive at an additional 181 million metric tons of carbon dioxide emissions per year resulting 

from the existence of the Keystone XL pipeline. 

In terms of carbon dioxide emissions, these differences may appear large and contentious, and, in 

fact, much of the protestation involving the Keystone XL pipeline focuses on these emissions 

numbers. 

But. these protests are largely misplaced. 

It is very important to keep in mind that the end game is climate change and the potential need of 

climate change mitigation. Carboll dioxide emissiolls are //Ot climate change. They influence 

climate change, but they are not a measure of it. 

Therefore, before any type of assessment as to the potential climate impact of the Keystone XL 

pipeline can be made, it is essential to translate the additional carbon dioxide emissions that may 

result fi'om it into climate lUlits-such as the global average temperature. In other words. how 

much global wanning will the Keystone XL pipeline produce? 

Isn't that what everyone wants to know? 

Why is it then, that such numbers are never given? 

It is not as if there is no good way of calculating them-that is precisely what climate models are 

designed to do. These complex computer programs emulate the e31th's climate system and allow 

researchers to change various influences upon it-such as adding additional carbon dioxide 

emissions-and seeing what the end effect is. These climate models produce the projections of 

future climate change from il1mlan activities that we are all familiar with using precisely this 

methodology. 

General circulation climate models are very complex and computational expensive to mn (both 

in time and money) and as a result have not been used to generate the global temperature effects 

of the Keystone XL pipeline. 

3 
64 

However, in lieu of nmning a fiul climate model, climate model emulators have been developed 

which can nm on a desktop computer. One snch pro!!ram is MAGICC, the Model for the 

Assessment of Greenhouse-gas Induced Climate Change. MAGICC is a climate model simulator 

developed by scientists at the U.S. National Center for Atmospheric Research lmder fimding by 

the U.S. Enviromnental Protection Agency and other organizations. MAGICC is itself a 

collection of simple gas-cycle, climate, and ice-melt models that is designed to produce an output 

that emulates the output one gets from much more complex climate models. MAGICC can 

produce in secollds, 011 a personal computer, results that complex climate models take weeks to 

produce nll1lling on the world's fastest supercomputers. MAGICC doesn't provide the breadth of 

output or level of detail that fully resolved climate models do, but instead simulates thc general, 

broader aspects of climate change such as the global average temperature. 

Moreover, MAGICC was developed, according to MAGICC's website, "to compare tile globalmean temperature and sea level implications of two different emissions scenarios." So, using 

MAG ICC to compare the climate change that is projected to result from the different Keystonc 

XL pipeline carbon dioxide emissions scenarios fits precisely into the program's designed 

purpose. 

Using MAGICC, I (and anyone else) can calculate the potential inlpact of the Keystone XL 

pipeline on the global average temperature based on the various carbon dioxide emissions 

estimates, and produce results very similar to ones that would be achieved by using a filll climate 

model. 

In the base case, I flm MAGICC using a mid-range, business-as-usual filture emissions scenario 

as defined by the IPCC (SRES AlB). To examine the climate change impact using the EPA's 

Keystone XL carbon dioxide emissions scenario, I add 18.7 million metric tons per year to the 

global carbon dioxide mission total each year begilllling in the year 2010 and continuing through 

tile year 2100. To assess impact of the emissions scenario prefened by some enviromnental 

organizations, I add 181 million metric tons of additional carbon dioxide emissions to the global 

total begirming in 2010 and extending through 2100. 

When nmning MAGICC as described, I find that no matter how the additional carbon dioxide 

emissions are calculated, the Keystone XL pipeline has an exceedingly and inconsequentially 

small impact Oll projected the course of global temperatme. 

In ilie case of the State Department's analysis, as there are velY few additional carbon dioxide 

emissions, there is essentially no associated change in the global climate. The change in global 

average temperature resulting fi-om the EPA's additional 18.7 million metric tons of c3l'bon 

dioxide emissions per year from the Keystone XL pipeline, would be about O.OOOOJOC per 

year-that is one one-hmldred thous3lldths of a degree. The 181 million metric tons per year 

from the asslUnption that all Keystone XL oil is additional oil in the global supply would reslut 

in about 0.000 I °C of allllual wanning-one ten-thousandths of a degree. 

In other words, if the Keystone XL pipeline were to operate at fitli capacity lmtil the end of tins 

centmy, it WOUld, worst case, raise the global average surface temperature by about 1Il00·h of a 

4 
65 

degree Celsius. So after nearly 100 years of fhll operation, the Keystone .IT's impact 01/ the 

climate would be illco11Sequellfial and IIll1l1easllrable. 

And even these tiny mUllbers are probably overestinmtes. In calculating them, I used the 

MAGICC default value for tbe magnitude oftlle emth's equilibritull climate sensitivity. A value. 

3°C, that was based on the assessment of the equilibritull climate sensitivity given by the 

Intergovenullental Panel on Climate Change (IPCC). The equilibritull climate sensitivity is the 

anlOunt that the em1h's stu'face temperatme will rise from a doubling of the pre-industrial 

atmospheric concentration of carbon dioxide. As such, it is probably the most important factor in 

detenniuing whether or not we need to "do something" to attempt to mitigate futtu'e climate 

change. The lower the climate sensitivity, the less the temperatme rise ii-om human carbon 

dioxide emissions, and the lower the urgency to try to reduce them. If the sensitivity is low 

enough, cm'bon dioxide emissions confer a net benefit. 

And despite common claims that the "science is settled" when it comes to global wmllling, we 

are still learning more and more about the em1h complex ciinlate system-and the more we 

learn, the less responsive it seems that the earth's average temperature is to human carbon 

dioxide emissions. 

For eXalllple, the observed lack of statistically significant temperature rise over the past 16 years 

(and C01Ulting), is strong indication that climate models have a tendency to overestinlate the 

aIl101Ult of w8nuing resulting from IUUllan greenhouse gas emissions (Figure 1). 

Surface Air Temperature Trends 

0.12 

0.1 

0.08 

g 006 

0.04 

~ 0.02 "0 

c 

II> 0 

t:: -002 

-0.04 

·006 

-008 

5 6 7 8 9 10 11 12 13 14 15 

Trend length (yr) 

Figure L Cmn:nt (t:Ilding ill December 2012) trends illtlm:e observed global smIace temperature records 

of length 5 to 15 years (colored lines) set against the probability (gay lincs) derived from the complete 

collection of climate model mns used in the IPCC Fourth Assessment Report under the SRES AlB 

emissions scenario (Knappenberger and Michaels .. 2013). 

5 
66 

i was involved ill research that we published more than a decade ago pointing out that global 

temperatmes were not rising as fast as climate model expectations (Michaels et a1., 2002), and 

increasingly, there is a growing acknowledgement of this fact. 

o 

...... 11---1----- - "IPCC AR4 

Hargreaves et al. (2012). Bayesian, dust 

........... t· ...... · .... · .... Hargreaves et al. (2012). Regression. dust 

.. I ... Hargreaves et al. (2012). Bayesian 

.. I ... Hargreaves et al (2012). Regression 

Ring et al. (2012) 

... , ... ~ van Hateren (2012). variable sun 

"'1 ... Aldrin et al. (2012) 

.... lindzen and Chol (2011) 

.. I It> Schmittner et aL (2011), land+Ocean 

2345678 

Equilibrium Climate Sensitivity (0C) 

9 10 

Figure 2. Climate sensitivity estimates from new research published since 2010 (colored. compared with 

the range given in the illtcrgovcmmental Panel on Clilllate Change (lPCC) Fom1h Assessment Repm1 

(AR4) (black). The a1TOWS indicate the 5 to 95% cOlltldcnce bounds for each estimate along with the best 

estimate (median of each probability density flUlction: or the Illeall of lllllltip\e estimates: colored vertical 

line). Ring et al. (2012) present foUl' estimates oUhe climate sensitivity and the red box encoIllpasses 

those estimates. The ri!lht-hand side of the II'CC AR4 fal1!lc is dolled to indicate that the IPCC does not 

actually state the value for the upper 95% confidence bOlUld oftlleir estimate and the left-hand an-ow only 

extends to the 10% lower bOlUld as the 5% lower bOllnd is not given. The light grey vel1ical bar is the 

mean of the 14 best estimates ti'OIll the new tilldin!ls. The II'CC's "best estimate" (3.0°C) is 50% greater 

than the meall of recent estimates (2.0°C). 

6 
67 

Over the past three years, a collection of findings in the peer-reviewed scientific literahlfe has 

suggested that the IPCC's best estimate of the equilibrium climate sensitivity is likely too high 

by nearly 50 percent. Instead of the IPCC's 3.0°C, the new findings are indicating a value close 

to 2.0°C (see Figure 2). 

Remnning the MAGlCC climate model simulator with an equilibrium climate sensitivity setting 

of 2.0°C, instead of the 3.0PC default value, drops the calculated wanning impact from the 

Keystone XL pipeline by about 30 percent. 

It is this infol1nation, not the infol1Uation on carbon dioxide emissions that is required to properly 

assess the climate change aspect of the enviromnental impact of the Keystone XL pipeline. 

In these tenllS, the difference between the State DepaItment's EnvirolUnental Impact Statement 

and those of its critics all but vanish. 

No matter whose carbon dioxide emissions estimate is used to calculate it, the climate impact of 

the oil carried by the Keystone XL pipeline is too small to measure or cany any physical 

significance. 

In deciding the fate of the Keystone XL pipeline, it is impol1ant not to let symbolism cloud these 

facts. 

References: 

Aldrin, M., et aI., 2012. Bayesian estimation of climate sensitivity based on a sinlple clinlate 

model fitted to observations of hemispheric temperatllfe and global ocean heat content. 

E11Viroll1l1etrics, doi: 1O.1002/env.2140. 

AllllaIl, J.D., and J.C Hargreaves, 2011. On the generation and interpretation of probabilistic 

estimates of climate sensitivity. Climatic ClIallge, 104,324-436. 

Hargreaves, J.C., et aI., 2012. Can the Last Glacial MaximlUn consh'ain c1inlate sensitivity? 

Geophysical Research Letters, 39, L24702, doi: lO.1029/2012GL053872 

Intergovemmental Panel on Climate Change, 2007. Climate Change 2007: nle PhYSical Science 

Basis. Contribution of Working Group I to 'he Fourth Assessmellf Report of the 

Intergovernmental Panel 011 Climate Change. Solomon, S., et al. (eds). Camblidge Uiliversity 

Press, Crunbridge, 996pp. 

Knappenberger, P.C., and P.I. Michaels, 2013. Policy Implications of Climate Models on the 

Verge of Faihlfe. American Geophysical Union Science Policy Conference. Washington, DC, 

Jlme 24-26, 2013, snbmitted. 

Lewis, N. 2013. An objective Bayesian, improved approach for applying optimal fingelprillt 

teclmiques to estimate climate sensitivity. JOllfual of Clinlate, doi: 10.11 75/JCLI-D-12-004 73.1. 

7 
68 

Lindzen, R.S., and Y-S. Choi, 2011. On the observational detelmination of climate sensitivity 

and its implications. ASia-Pacific Journal of Atlllospheric Science, 47,377-390. 

Michaels, P.I., Knappenberger, P.e., Franenfeld, O.W., and R.E. Davis. 2002. Revised 21st 

century temperature projections, Climate Research. 23, 1-9. 

Ring, M.J., et aI., 2012. Causes of the global walTIling obselved since the 19th cellttuy. 

Atmospheric alld Climate Sciences, 2,401-415, doi: 1O.4236/acs.2012.24035. 

Schmittner, A., et al. 2011. Climate sensitivity estimated fi'om temperature reconstructions of 

the Last Glacial Maximum. Sciellce, 334, 1385-1388, doi: 10.1126/science.l203513. 

Wigley, T.M.L., et al. MAGICC/SCENGEN v5.3. Model for the Assessment of Greenhouse-gas 

Induced Climate Change/A Regional Climate Scenallo Generator. 

http://www.cgd.ucal·.edu/cas/wigley/magicc/ 

VaIl Hateren, I.H., 2012. A fractal climate response function Call simulate global average 

temperattrre trends of the modem era and the past millellnilUll. Climate DYllamics, doi: 

10.1 007 /s00382-0 12-1375-3. 

8 
69 

Short Narrative Biography 

Paul C. "Chip" Knappenberger is the assistant director of the Center for the Study of Science at 

the Cato Institute, and coordinates the scientific and outreach activities for the Center. He has 

over 25 years of experience in climate research and public outreach, including 13 years with the 

Virginia State Climatology Office and 17 years as the Research Coordinator for New Hope 

Environmental Services, Inc. Chip has published numerous papers in the major atmospheric 

science journals on global warming, hurricanes, precipitation changes, weather and mortality, 

and Greenland ice melt, among many other areas. 

He holds an M.S. and B.A. degrees in Environmental Sciences from the University of Virginia. 
70 

Chairman STEWART. Thank you, Mr. Knappenberger. 

To all the witnesses, thank you again for your testimony, for 

your expertise. 

I would remind the Members that when we do ask our questions, 

Committee rules limit the questioning to five minutes. And we look 

forward to asking and prodding you a little bit on that, but before 

we do, we are going to back up just a little bit and with agreement 

with the Ranking Minority Member, we are going to go to the 

Chairwoman of the Subcommittee on Energy, Mrs. Lummis, and 

allow her to provide her opening statement. 

Mrs. LUMMIS. Well, thank you, Chairman Stewart. And I apologize for my conflicting meetings this morning. And thank you for 

allowing me to join you late. I was over at the Natural Resources 

Committee. 

This is such an important subject for our country, and so I really 

want to thank you for scheduling this hearing on the science and 

technical issues related to the Keystone XL pipeline, which falls 

squarely within the jurisdiction of this Committee. And I want to 

thank the witnesses for being here today as well. 

As we all know, the energy landscape is changing dramatically. 

We have gone in the United States from being a net importer to 

a net exporter of petroleum products. At the same time, we have 

gone from being a net exporter of food to a net importer, so lots 

of things changing in our country. We have now become a global 

leader in natural gas production and are expected to lead in oil production by the end of the decade. Instead of building import terminals for LNG, we are modifying these facilities to export our abundant natural gas. And we have countries all over the world that 

would be so happy to receive our abundant natural gas resources. 

And despite these changes, the Keystone XL pipeline languishes. 

Now, this project would allow us to decrease our reliance on unfriendly sources of oil and increase our trade relationship with 

Canada. Approval of the pipeline would also carry Bakken crude 

being produced in North Dakota. I deeply appreciate the comments 

of our witness, Mr. Helms, on that subject earlier. 

The pipeline offers a safe and permanent solution to alleviate the 

bottleneck of U.S. crude oil in the midcontinent. In fact, it is the 

safest solution that exists. And I can say that as a person who 

grew up and still ranch next to an oil refinery. And we have lots 

of problems with the oil refinery, and I am grateful for RCRA and 

other environmental laws and for environmental regulators that 

help us regulate our neighborly relationship with a refinery. The 

pipelines have never been the problem. The pipelines have been the 

safest part of that operation. 

The State Department, in fact, has concluded that the Keystone 

XL pipeline, with its 57 extra safety features, would have a degree 

of safety over any other domestic pipeline. Yet this Administration 

persists in stopping the project, saying in 2012 that a deadline requiring the President to approve or deny the pipeline ‘‘prevented a 

full assessment of the pipeline’s impact.’’ Now, this was after thousands of pages of analysis and tens of thousands of public comments over a four-year period. 

Now, we have had another year and another report, still no response from the Administration other than to stall the project to 
71 

death. Now, that is not too surprising to some of us, because we 

are finally of the realization that all-of-the-above to this President 

must mean something other than hydrocarbons. But I don’t understand how the President can claim to be committed to job creation 

and economic growth and still obstruct this project because it 

would support both. According to the State Department, the project 

would support over 42,000 jobs and result in $2 billion in the pockets of hard-working Americans. That would be such a shot in the 

arm to our economic recovery. 

And that is just beginning. Direct expenditures on construction 

and materials could amount to $3.3 billion, and sales and use tax 

could generate another $65 million in revenue for States, not to 

mention the positive impact that trade with Canada has on our 

U.S. economy. According to the U.S. Census Bureau, for every dollar the United States spends on Canadian goods and services, Canada spends approximately 89 cents on U.S. goods and services. 

So this testimony today is deeply appreciated. It is very helpful. 

It is going to be very interesting for us to have the opportunity to 

quiz you about the very disparate conclusions that you have drawn 

and expressed in your opening statements, but I do want to thank 

you, Mr. Chairman, for allowing me to present opening remarks. 

And I yield back. 

[The prepared statement of Mrs. Lummis follows:] 

PREPARED STATEMENT OF CHAIRWOMAN OF THE ENERGY SUBCOMMITTEE CYNTHIA

LUMMIS

Good morning and welcome to today’s hearing, ‘‘Keystone XL Pipeline: Examination of Scientific and Technical Issues.’’ I want to thank Chairman Stewart for holding this hearing with me on such an important and pressing issue. I also want to 

thank the witnesses for being here today, and I look forward to their testimony. 

In the last few years, the U.S. energy landscape has changed dramatically. We 

have gone from a net importer to a net exporter of petroleum products; we have become the global leader in natural gas production and are expected to lead in oil production by the end of the decade. Instead of building import terminals for LNG, we 

are modifying these facilities to export our abundant nautral gas resources. 

Despite these changes, one issue has remained stagnant over the last four years, 

and that is the approval of the Keystone XL Pipeline. This project would allow us 

to decrease our reliance on unstable or unfriendly sources of oil and increase our 

trading relationship with Canada, a friendly, democratic, and stable ally. Approval 

of the pipeline would also facilitate our own oil development, as the pipeline would 

also carry Bakken crude being produced in North Dakota. 

In addition to increasing our energy security, the pipeline offers a safe and permanent solution to alleviate the bottleneck of U.S. crude oil in the midcontinent. In 

fact, it’s the safest solution that exists. The State Department concluded Keystone 

XL, with its 57 extra safety features, would have a degree of safety over any other 

domestic pipeline. Yet President Obama has slow-walked the project, saying in 2012 

that a deadline requiring him to approve or deny the pipeline ‘‘prevented a full assessment of the pipeline’s impact.’’ This was after thousands of pages of analysis 

and tens of thousands of public comments over a four-year period. 

Another year and another report later, the Administration has yet to approve the 

project. That the Administration would slow-walk a project that supports fossil fuels 

is perhaps no surprise to some of us. However, what I cannot understand is how 

the President can rhetorically claim to be committed to job creation and economic 

growth, and in practice obstruct a project that would support both. According to the 

State Department, the project would support over 42,000 jobs and result in two billion dollars in the pockets of hardworking Americans. This would represent a significant contribution to our slow economic recovery. 

And that is just the beginning. Direct expenditures on construction and materials 

could amount to $3.3 billion dollars, and sales and use taxes could generate another 

$65 billion dollars in revenue for the affected States. Yet another often-overlooked 
72 

economic benefit is the positive impact that trade with Canada has on the U.S. 

economy—trade with Canada benefits the U.S. economy more than trade with any 

other nation in the world. According to the U.S. Census Bureau, for every dollar the 

U.S. spends on Canadian goods and services, Canada spends approximately 89 cents 

on U.S. goods and services. I hope this Administration realizes that actions speak 

louder than words. To voice support for job creation and economic growth is one 

thing; to actually do something about it is another. I hope the President will 

prioritize action over empty rhetoric and approve the project as soon as possible. We 

have waited long enough. 

Thank you, Mr. Chairman. I yield back. 

Chairman STEWART. Thank you, Ms. Chairwoman. 

If there are other Members who wish to submit additional opening statements, your statements will be added to the record at this 

point. 

And now, we come to the questioning of the panel, and as all of 

us look forward to this, I recognize myself for five minutes for my 

questions. 

You know, I have to say, just as an aside, this problem puzzles 

me. It seems to me that this is something that there should be 

broad and bipartisan support for. That the objections to the pipeline are a great example of straining at a gnat and swallowing a 

camel, I just think you have to work—you have got to work hard 

to find real objections to this project. 

And I understand the keys are, you know, can we operate it safely and is it going to increase CO2 emissions in a meaningful way? 

And I think that you have done a great job of answering those 

questions. And when you weigh that against the—you know, the 

cost-benefit analysis of the economic impacts and the national security interests, again, it is difficult for me to understand why this 

is not an easy decision and, frankly, a decision that should have 

been made, well, sometime ago, certainly within the last four years. 

The environmental groups rest their opposition on the proposed 

project on the assumption that it will contribute to climate change, 

and I think there are two false assumptions here. One of them is 

very meaningful to me as a former business owner, the presumption that in the absence of the pipeline, this natural resource will 

remain in the ground, and I just can’t imagine an economic analysis or an economic model that would prove that. I mean it would 

work against everyone’s self-interest that are involved in this 

project to say that, well, they can’t pipe it; therefore, they are going 

to leave it. 

And the second one would be that the emissions from the sands 

production would have a significant impact on climate change, 

which is what many of you have addressed here today. I guess I 

would ask maybe Mr. Helms or maybe, you know, other members 

of the panel if you want, Mr. McCown or Mr. Knappenberger, if you 

want to jump in on this. And you have answered it on some level 

already but I would like to go into just a little more detail, first, 

your opinion on the first presumption that is this oil would remain 

in the ground if we are not able to pipe it. Mr. Helms, you look 

anxious to answer this. 

Mr. HELMS. Thank you, Chairman Stewart. I am anxious to answer it because people believe that the Bakken crude oil would remain in the ground in the absence of pipeline transportation, but 

the fact is that innovations in transportation systems and innovations in markets seeking the ideal market for the crude oil that 
73 

was tailored to the crude oil led to an abundance of rail transportation out of North Dakota. So, as I stated, 71 percent of our crude 

oil now moves by rail in the absence of pipelines. I think it is a 

faulty presumption that the oil will stay in the ground in the absence of Keystone XL pipeline. I think innovations will be put in 

place by industry to move that oil some other way—— 

Chairman STEWART. And in this case—— 

Mr. HELMS [continuing]. And those ways will be less safe and 

more environmentally risky. 

Chairman STEWART. And that is what I was going to re-emphasize. In this case, the options are much, much worse than having 

a pipeline. 

Mr. HELMS. That is right. 

Chairman STEWART. Yes. Any other comments then? 

Mr. MCCOWN. Now, Mr. Chairman, I was just going to echo those 

comments that, you know, this oil will find its way to the market, 

and it is already flowing through other pipelines. It is traveling by 

barge down the Mississippi River. Those efforts will continue, so it 

is in our interest to make sure it is transported as safely as possible, and that is with a brand-new, state-of-the-art pipeline. 

Chairman STEWART. To the—to other world markets, and the Pacific Rim, for example, isn’t it safe to say that our standards on air 

quality and other environmental thresholds are more stringent 

than if this oil were refined in India or China? 

Mr. MCCOWN. Absolutely. And, you know, the EPA is not in 

China yet to my knowledge. 

Chairman STEWART. Yes. So if you are interested in global climate change and recognize that this is a global market and a global problem, wouldn’t you be advocating for this product to be refining here in the United States where we have very strict refining 

standards? 

Mr. MCCOWN. Absolutely. And that is my argument as well, that, 

you know, this displaces oil from less stable nations, it displaces oil 

that is being brought in from overseas, and I think you have made 

a critical point on not only the emissions but also on the energy 

security component as well. 

Chairman STEWART. Okay. All right. Thank you. Thank you for 

your responses. 

And I now recognize Ms. Bonamici for her five minutes. 

Ms. BONAMICI. Thank you very much, Mr. Chairman. 

Just in response to your comments, Mr. Chairman, I do want to 

point out that the president of Canadian Natural Resources Limited recently said long term we do need Keystone to be able to grow 

the volumes in Canada. So I just wanted to point that out, that 

there will be growth because of the Keystone pipeline and we 

would need to keep that in mind. 

Mr. Swift, in your testimony you talked about the number of permanent jobs that are anticipated from the Keystone XL pipeline, 

and there is no question that there will be several thousand temporary construction jobs, no doubt about that, but in terms of permanent jobs, you mentioned—— 

Mr. SWIFT. The State Department estimated that there would be 

35 permanent jobs. 
74 

Ms. BONAMICI. Thirty-five jobs. And just to put that in perspective, the Congressional Budget Office estimated that there will be 

750,000 jobs lost because of sequestration, so I just want to put 

that in perspective. We are talking about 35 permanent jobs. 

In your testimony, Mr. Swift, as well as in the EPA’s April 22, 

2013, letter to the State Department commenting on the Draft Environmental Impact Statement, there is a brief but, I think, a significant discussion regarding the Enbridge spill at the Kalamazoo 

River in Michigan and what has been learned so far about spills 

of oil sands or diluted bitumen into water bodies. And the EPA expressed its concern about the Keystone project by suggesting on 

page three of the letter, ‘‘spills of diluted bitumen, dilbit, may require different response actions or equipment from response actions 

for conventional oil spills.’’ 

They go on to suggest that the State Department address this in 

greater detail and they state on page four of the letter that dredging of the bottom sediments was determined to be the best way to 

clean up the Kalamazoo River, which three years later they are 

still working on. But if you read the EPA’s response in its entirety—and I certainly don’t want to speak for them because they 

are not here—the letter seems to suggest a concern that we may 

not know enough about how to clean up this material. So are you 

aware of any other best practices for cleanup of diluted bitumen besides dredging the river, or are you aware of whether the State Department discussed any alternatives in the Draft Environmental 

Impact Statement for best practices of cleanup of diluted bitumen? 

Mr. SWIFT. The State Department recognized that the Kalamazoo 

spill poses unique risks that conventional practices had been inadequate to contain and remediate the spill, but they made the point 

that they were looking toward future innovations to be able to deal 

with tar sands spill. And unfortunately, those innovations haven’t 

happened. We are no further now than we were in 2010 when it 

comes to dealing with diluted bitumen tar sands. And the problem 

there is that, you know, once you have a release in a water body, 

the bitumen is heavier than water. It sinks into the water column. 

And most conventional practices rely on the idea that oil will float 

on the water’s surface. 

Ms. BONAMICI. All right. Thank you. And also, Mr. Swift, as I 

mentioned in the opening statement, we had a hearing a couple 

weeks ago in the Environment Subcommittee on relevant issues related to climate change. We had Dr. Bill Chameides here, a wellrespected atmospheric scientist who studies global warming and 

climate change, and he is suggesting an iterative risk-management 

approach, meaning that we must constantly reevaluate whether we 

are making the right decisions to address climate change as we 

learn more as technologies change. 

And we have heard today from some of the witnesses who now 

say that Keystone XL will not matter much to the amount of global 

greenhouse gas emissions. However, each new project, without 

strong controls, will add more greenhouse gases into our atmosphere. So will you provide your views on how the Keystone XL 

project would affect global greenhouse gas emissions given that we 

estimate that the substance transported by Keystone is 17 percent 

more greenhouse gas-intensive than conventional crudes? 
75 

Mr. SWIFT. Well, so EPA estimates that it would add, you know, 

a billion metric—a million metric tons of carbon in the atmosphere 

over its lifetime just simply by replacing tar sands—or conventional 

crude with tar sands at the Gulf Coast. One of the important 

things to recognize is here we have a project in which you can 

map—and, you know, my—Chip would agree that you can actually 

determine an impact on global temperatures from building this 

pipeline. And in the scheme of climate change where one degree 

Celsius is the difference between significant environmental changes 

that have significant impacts on how we are able to live our lives 

in the future, a little bit over the top makes a big difference when 

it comes to whether we reach our climate goals or not. 

Ms. BONAMICI. Thank you. And just in my remaining few seconds, I would like to hear from each witness quickly, please. I have 

heard that building the Keystone XL might actually increase gas 

prices in the Midwest. Is that correct? 

Mr. SWIFT. I will say that TransCanada noted that building Keystone XL would increase oil prices in the Midwest. And one of the 

tar sands producers, the President of Cenovus, noted that the lack 

of pipelines from Alberta was constituting a subsidy to U.S. energy 

consumers of over $30 billion a year. 

Ms. BONAMICI. I am sorry. My time is expired. I yelled back. 

Thank you, Mr. Chairman. 

Chairman STEWART. Did any of the others want to address that 

last question? She left it open for any of you. 

Mr. MCCOWN. I will just mention that because of the constraints, 

there is a discount on crude but the refining margin is greater, but 

that doesn’t necessarily translate into cheaper retail prices. So the 

refining margins may decrease once Keystone, but I don’t see a direct impact to added retail price at the pump. 

Chairman STEWART. Okay. All right. Thank you. I would just 

note quickly if you are unemployed right now and hoping for a job, 

having a job to only last two or three years is not a bad deal when 

you are looking at that or nothing. 

Mrs. Lummis, the Chairwoman of the Subcommittee on Energy. 

Mrs. LUMMIS. Thank you, Mr. Chairman. 

Mr. McCown, some of the opponents of the project have argued 

against a piece of infrastructure, pipeline, that is widely used in 

the United States. I would like to know if you agree that oil sands 

pose greater risks for pipeline integrity. 

Mr. MCCOWN. I do not believe that they do. Canada has been 

transporting this type of crude since 1968. The United States has 

about ten years of experience transporting this crude. The Integrity 

Management Program for pipeline safety has come a long way—a 

long way in the last decade to now where corrosion is no longer the 

leading cause of pipeline accidents. Serious pipeline accidents are 

caused by third-party damage. That being said, there are multiple 

studies out on dilbit corrosivity. I have several of them here. Each 

one of them says, you know, pipeline steel wet by oil does not corrode. The pH values of the dilbit do not contribute to stress corrosion cracking, which is what Mr. Swift was talking about, so long 

as a different epoxies are used, different type of bonding materials, 

which we are going to see in this pipeline. 
76 

So, you know, this oil has been transported safely for a very long 

time, and, you know, have there been spills that have been referenced? Yes, but it is a little bit of a leap to then say then they 

must because to because of this type of oil. In fact, like I said, we 

know that most pipeline accidents are not caused by the pipelines 

themselves. 

Mrs. LUMMIS. Follow-up question: the State Department’s assessment was that the possibility for spills is rare and relatively small. 

Do you agree with the State Department’s assessment, and do you 

know what they base their conclusions on? 

Mr. MCCOWN. I do agree. I mean, they based their conclusions 

on the review of the pipeline process and the pipeline design specs, 

which it is my understanding the State Department was aided significantly by the USDOT, who are the pipeline experts and—in assessing this pipeline. You know, the 57 special conditions frankly, 

you know, go well above and beyond what federal law currently requires in many areas with respect to the design and the operation 

of the pipeline. That doesn’t mean we shouldn’t be vigilant. It 

doesn’t mean that we shouldn’t hold the accountable responsible for 

how they operate the pipeline, but, you know, I have looked at this 

pipeline. I have looked at the specifications. I have talked to them, 

and I feel confident that this will, in fact, be the safest pipeline 

ever constructed, and that enhances security. And, as we know, 

pipelines are the safest mode of transportation. To me, this is a nobrainer. 

Mrs. LUMMIS. One more question, this one for Mr. 

Knappenberger. Regarding the EPA’s comments on the State Department report, the EPA questions the finding that Keystone XL 

would not substantially affect greenhouse gas emissions or contribute to climate change. Could you comment further on why you 

believe the State Department is correct rather than the EPA? 

Mr. KNAPPENBERGER. Well, I don’t take a strong opinion on 

which is correct when it comes to the carbon dioxide emissions 

from the pipeline. When you translate carbon dioxide emissions, 

though, into some sort of climate unit, which is what everyone is 

interested in, the climate impacts of the pipeline, you find that the 

differences between next-to-no emissions and EPA’s analysis, which 

turned out to be 18.7 million metric tons of extra emissions, it 

sounds like a lot, but when you translate those extra emissions into 

carbon units or into climate change units, they turn out to be hardly any difference between them at all. We are talking about hundreds of thousandths of degrees here. 

Mrs. LUMMIS. Is it true that we now meet Kyoto Protocol numbers? 

Mr. KNAPPENBERGER. I don’t believe that is the case, no. 

Mrs. LUMMIS. Okay. Is it true that the Clean Air Act has produced cleaner air every year since it has been in effect? 

Mr. KNAPPENBERGER. Well, the Clean Air Act, until recently, 

wasn’t designed to regulate carbon dioxide emissions, so I think the 

Clean Air Act probably successfully cleaned up what I consider traditional pollutants in the air. I don’t think that carbon dioxide is— 

sort of meets the definition of a traditional pollutant. 

Mrs. LUMMIS. Is it a pollutant? Is carbon dioxide a pollutant? 

Mr. KNAPPENBERGER. Not in my opinion. 
77 

Mrs. LUMMIS. Okay. Mr. Chairman, I yield the balance of my 

time. 

Chairman STEWART. Thank you, Mrs. Lummis. 

We now recognize Mr. Swalwell. 

Mr. SWALWELL. Thank you, Mr. Chair. 

And my concern is primarily environmental safety and economic 

growth and how we balance the two of those. And I understand and 

appreciate the need for jobs. And our brothers and sisters in the 

building trades will tell you that right now in these tough economic 

times that any job is a good job, even a temporary job, because we 

know, in the construction trades, they move from temporary project 

to temporary project. And I certainly appreciate that.And what I 

want to talk about is just kind of weighing the environmental impacts against economic growth and whether the long-term impacts 

outweigh the short-term gains in economic growth. 

Also, my friends from the other side have expressed concerns 

about the Administration and frustration with the Administration 

going forward, but I think what we have seen here is two conflicting reports, one from the State Department and one from the 

EPA. And I would suggest and put forward that if there was a conspiracy by the Administration against this project, they are not 

doing it in a very good way because they certainly would not have 

two conflicting reports. 

And so I ask you, Mr. Swift, does it seem like there is a conspiracy against this project from the Administration, or is it more 

complicated than that because of such a large-scale project? 

Mr. SWIFT. Certainly no conspiracy. And I would also mention 

that this phase of the Keystone XL pipeline has really only been 

in review for about 12 months after it was rejected. This is a new 

presidential permit application. It restarts the process. 

Mr. SWALWELL. Great. Mr. Swift, in your testimony you describe 

some significant environmental concerns associated with this 

project, including increased greenhouse gas emissions and potential 

risks to pipeline safety. Is there any way we can address or mitigate these impacts while still allowing Keystone XL to move forward? 

Mr. SWIFT. Well, certainly, one of the key issues is a higher carbon content of tar sands. And, to some extent, we have seen very 

little progress in Canada at reducing the carbon content of tar 

sands production paths. Canada agreed with us to reduce our— 

their emissions by 17 percent of 2005 levels by 2020, and they are 

on track of—to increasing theirs by five percent while we are on 

track to meeting ours. So, to some extent, one of the issues is the 

nature of tar sands production. 

Mr. SWALWELL. Also, an argument I have heard in favor of this 

project is that from a national security standpoint it is better that 

we are receiving extracted oil from allies like Canada rather than 

volatile areas like the Middle East. But given that the price of 

crude oil is set globally and world oil production was about 89 million barrels per year last year according to the Energy Information 

Administration, how would Keystone impact gas prices in the 

United States and, let’s say, if we had a major supply disruption 

somewhere else in the world? 
78 

Mr. SWIFT. Keystone would not buffer us from supply disruptions, because when you have a supply disruption, there is a global 

market. Canadian oil prices go up despite the fact they have no 

other market to sell it to than the United States. I should mention 

that over the last five or six years, the one thing that has begun 

to protect the U.S. energy market is our reduced consumption of 

fossil fuels. We have reduced our use by over two million barrels 

a day, which is quite a bit more than Keystone would carry. 

Mr. SWALWELL. Is there any guarantee in any of the contracts 

you have seen or specs you have seen that would promise that U.S. 

consumers would have access and rights to the oil first? 

Mr. SWIFT. There is no guarantee whatsoever, and in fact, TransCanada has been asked to make such a guarantee and they have 

refused to do so. One of the areas of State’s analysis indicates that 

over half of the crude oil in Keystone XL will be refined and exported internationally. 

Mr. SWALWELL. And so when it comes to the impacts of oil supply 

disruptions and price volatility on our national security, do you 

think it is fair to say that the big issue is not so much America’s 

dependence on foreign oil but rather it is our dependence on oil, period? 

Mr. SWIFT. That is exactly how I see it. 

Mr. SWALWELL. Great. Thank you. And I will yield back the balance of my time. 

Chairman STEWART. Thank you. The Chair now recognizes Mr. 

Rohrabacher. 

Mr. ROHRABACHER. Thank you very much, Mr. Chairman. And 

thank you for holding this hearing. 

Let me just note, I was a young reporter before I got involved 

in working with President Reagan and coming here, and my memory has it that almost every single oil and gas project that has been 

proposed in my adult lifetime has been opposed by—and strenuously opposed by a certain group of people within our society. And 

I will have to say that most of the opposition to oil and natural gas, 

which, of course, provides us as Americans with—well, with the energy we need for—to have an agricultural system that provides us 

food and the fuel that we need for commerce and we have national 

defense and national security and industry. All of these things depend on oil and natural gas now. Yet, during my lifetime, there has 

been a group of people opposing every single new project. There is 

always some reason. 

And I noted when I was younger—I covered a story when they 

were talking about oil spills, and there was an oil spill off of my 

coast, and I was concerned about it. And the oil companies did a 

study to see what the problems were, and when they had a hearing 

on it, they had a hearing—I happened to be a young reporter at 

the time and, Mr. Chairman, I will never forget this hearing. The 

oil companies were really boring and didn’t give us much copy, but 

there was a young girl outside the hearing who was holding up a 

rubber duck covered with oil screaming ‘‘murderer’’ at the guys 

who were going in to testify. And you can imagine who got the 

press coverage. 

This is really a significant—this is really significant to whether 

or not we are going to have prosperity in our country, because at 
79 

that time the American people took for granted that we were going 

to be prosperous, and we were going to be secure, and there would 

be these fundamental building parts of our economy that would develop as they always had been. That is not the case anymore. The 

American people understand how fragile we are economically and 

understand how, even with supposedly a 7.5 unemployment rate— 

anybody who believes that probably also believes in global warming—we have to take this seriously. And let’s just note of all these 

objections what they have accomplished, Mr. Chairman, is that we 

have hired a lot more lawyers, and the lawyers have made a lot 

of money over the years on this, which is then added to the bill 

that costs for energy, of course. 

The one other thing that I remember is also that the horrendous 

predictions of what would happen if we built the Alaskan pipeline. 

It just happened to be at that time. Now, I want everybody to think 

what our economy would have done in the last 20 years had we not 

built the Alaskan pipeline. But we heard the same thing and we 

heard the caribous were going to disappear because the pipeline 

was going right through their breeding area. And now, what have 

we found out after the pipeline? They love the pipeline, and in fact, 

there are more caribous than ever because they sort of snuggle up 

to it when it gets cold. 

We have got to start using our heads on this when we are making decisions, because it is going to impact on more than just the 

caribous. It is going to impact on whether or not the United States 

is a prosperous and secure country. And I find the arguments that 

we faced about pipeline—about this particular project, it has nothing to do with safety; it has everything to do with the global warming theory that human beings are causing the planet to change and 

get warmer and warmer, I might add. The predictions that we have 

had is by now it would be five degrees warmer than it is, and actually, it is getting cooler. 

So with those—that type of—I think I will—I have got exactly 25 

more seconds, and instead of leaving it up to the panel, I will just— 

with one last little shot here, and that is I believe that global—the 

global warming theory based that mankind is impacting on our climate has been so exaggerated just beyond—obviously, mankind has 

some impact because we all exhale carbon dioxide. And—but it has 

been so exaggerated that it will bring down the standard of living 

of the American people, this fraudulent idea that we are the primary factor in climate change and then the predictions of climate 

change just never happened. I mean it is—we are going in the opposite direction. 

Thank you very much, Mr. Chairman. 

Chairman STEWART. I thank you, Mr. Rohrabacher. 

And we now turn to your companion from California, Mr. 

Takano. 

Mr. TAKANO. Thank you, Mr. Chairman. And I share the gentleman’s concern and love of caribou. 

Mr. ROHRABACHER. I eat the caribou. 

Mr. TAKANO. I will leave it at that. I live somewhat inland from 

the gentleman in California. I live in a region of California that is 

in a basin surrounded by mountains, and so I am very grateful for 

strong EPA standards that have helped clean up the air. I remem-
80 

ber as a little boy that we would have days where we couldn’t go 

to physical education because the air quality was so bad. The air 

has gotten better through the standards, and the air may not be 

cleaner air from year to year, but certainly standards have helped 

us clean up the air in our region. 

Now, my question to Mr. Swift: Is it the case that this bitumen— 

and I have learned a lot more about bitumen here—will this oil be 

refined within the United States, or do we expect the bitumen to 

be exported abroad on ships to be refined in other countries? 

Mr. SWIFT. Well, in the short term, we are expecting it to be refined in the Gulf Coast of the United States. There is nothing— 

there are prohibitions to exporting crude produced in the United 

States. Canadian producers could export the bitumen for refinery— 

for refinement elsewhere, but the general expectation is it will 

move to the Gulf Coast, be refined there, and then many of the 

products from that would be exported internationally. 

Mr. TAKANO. When you say the Canadians could export crude bitumen without being refined in the United States, what do you 

mean by that? You mean that even though it is transported 

through this pipeline, it could be exported even from the endpoint 

in the United States directly in its crude form? 

Mr. SWIFT. There is no legal basis for preventing them from 

doing that once they get it to the—to Houston. 

Mr. TAKANO. Okay. Well, Mr. McCown, you are shaking your 

head. Do you disagree with that answer? 

Mr. MCCOWN. I do—yes, sir, I do disagree with that answer. You 

have to have an oil export license if you want to export raw crude. 

So I think it is—if the oil does not come here, and Canada built 

a different pipeline system or a rail system to somewhere else, 

sure, it can be exported. But if it comes to the United States, it has 

to be at least refined here. 

Mr. SWIFT. The export license requirement is for crude produced 

in the domestic 48 States of the United States. It doesn’t apply for 

crude produced in Alberta. 

Mr. TAKANO. Okay. Mr. Chairman, you raised the point about 

the—you know, the preference—the desirability of having crude refined in our country rather than other countries, which may have 

less stringent standards. I am just wondering if there is consensus 

that perhaps—or this point to me brings up, you know, the possibility that maybe we should look at tightening up that provision, 

that all oil that leaves our shores should be refined here and meet 

the more stringent standards set by our EPA. 

Mr. SWIFT. Well, one point I would make—was that a question 

for me? 

Mr. TAKANO. Yes, yes, go ahead. 

Mr. SWIFT. Well, one point I would make is that Canada has 

proven—there has been significant opposition to pipelines that 

would move tar sands across Canada’s west coast to the point that 

even industry observers are saying that those pipelines are unlikely to move forward. And the other point to keep in mind is that 

China doesn’t have the capacity to process heavy crude. So based 

on the refinery market that we see in the world today, the real 

question is does it get refined in the United States or does production expansion slow down? The question isn’t whether, you know, 
81 

we see zero tar sands production in 2030; the question is does production go from two million to three million barrels a day or two 

million to six million barrels a day? And when it comes to the environmental impacts, that makes a big difference, which is an area 

you land on. 

Mr. TAKANO. So it is the increased capacity that this pipeline 

would facilitate. It would stimulate far more rapid, intensive development of this source of bitumen? 

Mr. SWIFT. That is exactly right. 

Mr. TAKANO. How much experience do we have with bitumen 

flowing across oceans? 

Mr. SWIFT. When it comes to Canadian tar sands bitumen, I 

don’t think we have much experience. 

Mr. TAKANO. Are there comparable source of bitumen that are 

transported in large container ships? 

Mr. SWIFT. There are some heavy sources of crude from Venezuela that have some similar properties that move into Gulf Coast 

refineries. 

Mr. TAKANO. Okay. Have there been any spills of this sort of bitumen of any note? 

Mr. SWIFT. Not to my knowledge. 

Chairman STEWART. And, Mr. Takano, if I could, you may have 

noticed that your—we didn’t start the clock—— 

Mr. TAKANO. Oh, I am sorry. 

Chairman STEWART. We didn’t start on time. I think you are 

about out of time, but if you want to finish this question—— 

Mr. TAKANO. Okay. So, you know, my concerns are mainly about 

the Chairman’s concern about China and India having lesser standards in terms of refining. Is that a significant reason why the environmental community is concerned about—is this what adds to the 

global climate change? 

Mr. SWIFT. Well, certainly one of the key issues is, again, China 

and India don’t have the capacity to process this crude, and Canada currently doesn’t have the ability to send it to those markets. 

So, to some extent, the real issue is whether—the only way that 

tar sands crude or its refined products get to the international market right now is via Keystone XL. 

Mr. TAKANO. Okay. Thank you. Mr. Chairman, thank you. 

Chairman STEWART. Okay, thank you. Yes. It would surprise me 

if they—China and India don’t develop that capability very quickly 

if the opportunity arose for them. 

Mr. Weber. 

Mr. WEBER. Thank you, Mr. Chairman. 

For the panel, any of you all think that pipeline DB that wealth 

flowing through a pipeline produces as much CO2 as 300 to 500 

diesel 18-wheeler truckloads a day? Mr. Helms, somebody, yes or 

no? 

Mr. HELMS. Well, Congressman Weber, I don’t believe that it 

does and—— 

Mr. WEBER. Thanks. Mr. McCown. 

Mr. MCCOWN. It is not. 

Mr. WEBER. Mr. Swift. 

Mr. SWIFT. I—— 

Mr. WEBER. Your mike is not on. 
82 

Mr. SWIFT. Truck transport is more energy intensive than pipeline. 

Mr. WEBER. So you would agree that it does produce more CO2? 

Mr. Knappenberger. 

Mr. KNAPPENBERGER. Yes, I agree. 

Mr. WEBER. You agree, thank you. 

Next question for the panel, an industry safety rating of 

99.999525 percent safe, Mr. Helms, are you aware of any other industry that has that kind of safety record? 

Mr. HELMS. Congressman, I am not aware of any—— 

Mr. WEBER. Thanks. Mr. McCown. 

Mr. MCCOWN. I am not. And I think that will even go higher. 

Mr. WEBER. Mr. Swift. 

Mr. SWIFT. Industry is hoping to improve that record. When you 

think about the amount of oil—— 

Mr. WEBER. I will take that as a no. Mr. Knappenberger. 

Mr. KNAPPENBERGER. I don’t know of any, no. 

Mr. WEBER. I don’t either. Next question. Mr. Swift, you said 

that the likelihood—it seemed like you raised a lot of discussion 

about the likelihood of the bitumen oil leaking, and so that seems 

to be a great degree of your argument against the pipeline is based 

on the leakage. So you are not as concerned about the climate 

issues as you are the leakage. Is that fair to say? 

Mr. SWIFT. No, we are also very concerned about the climate. 

Mr. WEBER. More so than the leakage? 

Mr. SWIFT. I would say one of the primary environmental impacts is the climate issue. 

Mr. WEBER. Well, that is one of your primary environmental impacts. So if they—we can make the pipeline safer and if we can 

make climate emissions lesser, then you would be good? 

Mr. SWIFT. Yeah, if we can do—if we can—yeah, if we lower the 

climate emissions and make the pipeline safer. 

Mr. WEBER. Great. Are you familiar with the—and acronym 

BACT? 

Mr. SWIFT. You may have to refresh my memory. 

Mr. WEBER. Mr. Helms, do you know what BACT stands for? 

Mr. HELMS. Yes, Mr. Congressman. It is best available control 

technology. 

Mr. WEBER. Okay. And so is it safe to say that while we are developing—using this bitumen that we can improve our BACT, our 

best available control technology, so that we can reduce those emissions? In fact, I am somewhat amused by your discussion with my 

colleague from California talking about bitumen and how there 

wasn’t much experience in moving it and all that those implications, because if we refrained from new innovations, indeed we 

would not—you all would not be so intent on green technology, 

would you not? Solyndra wouldn’t have got half a billion dollars because they didn’t have a track record, no experience. 

So the truth of the matter is, in my opinion, that this very pipeline that comes into my district by the way—and it is not Houston; 

it is Port Arthur; Nederland, Texas, down on the Gulf Coast where 

XL pipeline terminates, just FYI. Under that assumption, the fact 

that we don’t know how to handle bitumen, we would have never, 

ever embarked upon trying to improve on batteries, on wind power, 
83 

on solar power because we don’t have that experience. I am 

amused, Mr. Swift, that you said after the Kalamazoo spill in 2010 

there have not been any innovations. I am thinking, my gosh, only 

somewhat three years later there are no innovations, and yet, in 

your very discussion points, you say that you are concerned about 

the pipeline going out 50 years and how long out do we worry 

about global warming? 

Mr. SWIFT. Quite some time. 

Mr. WEBER. Quite some time, yet you are lamenting the fact that 

there is no new innovations in handling that you have seen over 

the scant two or three years. That seems antithetical to me. 

How many of you all saw—did any of you all see the article in 

the Wall Street Journal yesterday about California and Texas producing oil? No? Okay. Well, let me make this point. My time is running short here. California—Texas produces more oil than the next 

four oil-producing States combined. California has been oil-averse, 

as my colleague over here said, people that were against everything 

about fossil fuel basically in his tenure. Texas’ unemployment rate 

is 6.4 percent while California’s is 9.4 percent. Texas has been the 

recipient of taxes of $20 billion from the oil industry and has no 

income tax, while California has an unbelievable—has an income 

tax rate and a capital gains tax rate of 13.3 percent. So the economic impact for our working Americans is huge. 

I am out of time. We need this pipeline. Mr. Chairman, I yield 

back eight seconds. 

Chairman STEWART. Eight seconds. Thank you, Mr. Weber. 

We now turn to Ms. Brownley from California. 

Ms. BROWNLEY. Thank you, Mr. Chair. 

I wanted to follow up on the line of questioning that Congresswoman Bonamici started at the beginning of the hearing and just 

talk a little bit more about job creation. And I am directing my 

question to you, Mr. Swift. You had mentioned that 35 jobs would 

be created from the Keystone pipeline. I wanted to really just explore a little bit about looking at job creation at Keystone compared 

to the job creation potential, I think, for sustainable alternative energy projects. And by the way, the comparison of Texas and California—I am from California—and we have been very focused on 

sustainable alternative energies and it is job creation as well. So 

if you could comment on that, I would appreciate it. 

Mr. SWIFT. Certainly. In 2011 a Brookings study showed that 

clean energy jobs are one of the fastest-growing sectors in the 

United States growing twice as fast as the economy. There are over 

2.7 million clean energy jobs today and a consortium of about 800 

clean energy entrepreneurs recently reported that in 2012 their 

companies hired over 100,000 personnel. And these jobs tend to 

be—I mean, in clean energy, you tend to see a higher manufacturing base element to them. And in another recent study, they 

evaluated the job creation impact by dollar invested. It found that 

clean energy, for every dollar invested, you got more than three 

times as many jobs produced than the fossil fuel industry. 

Ms. BROWNLEY. Thank you for that. Also, on the environmental 

side of this particular project, in your testimony I think you wrote 

and spoke to that the high-temperature tar sands pipelines are at 

a greater risk of leaks, and I think you cited a study in Kern Coun-
84 

ty, California. And so the question is is it fair to say that railroad 

trains carrying tar sands are also at greater risk of leaks? 

Mr. SWIFT. Well, one of the key things to keep in mind when it 

comes to railroads moving tar sands, while many railroads are 

moving Bakken crude, there has been very little tar sands by rail. 

A Reuters story just a few weeks ago showed that, you know, 

around 20,000 barrels a day was being moved to the Gulf Coast by 

rail or barge, and one of the—I mean the northern Albertan tar 

sands producers have been under many of the exact same market 

incentives to move their product by rail. The difficulty is they don’t 

have the profit margins to afford the higher costs. They are more 

than 900 miles farther away from refinery markets. And, in fact, 

the mere process of moving tar sands by rail is more expensive. It 

requires specialized infrastructure, and you can actually fit less tar 

sands crude in each rail car relative to light crude. And we are not 

seeing the infrastructure being built out yet. 

Ms. BROWNLEY. Thank you. And my last question is—I think Mr. 

Helms testified that his son-in-law is a farmer, I believe, and said 

he had no objection to the Keystone pipeline. And so I just, you 

know, wanted to hear your comments vis-a-vis rural areas, and will 

operators in rural areas be able to respond quickly in the event 

that there was some kind of accident or spill? 

Mr. SWIFT. You know, I have talked to folks in Nebraska and 

South Dakota. The—one of the farmers who discovered the 20,000 

gallon spill on the Keystone I pipeline was a first responder. He 

had no idea what to do in the event of a tar sands spill. And first 

responders are often the ones that detect leaks, that have to deal 

with it initially, and they don’t have the training to deal with it. 

And as far as farming goes, farmers in Nebraska are very opposed to the project, and they are concerned about its impact to 

their water and also looking at the climate impacts of, you know, 

warmer temperatures, disrupted weather on farming. Last year, we 

had the hottest year on temperature. Half of our corn crop was destroyed in a drought. So farmers are on both ends, concerned about 

their water quality and also feeling the brunt of climate change. 

Ms. BROWNLEY. And do we have evidence of what your statement 

that you just made about ranchers’, farmers’ concerns and—— 

Mr. SWIFT. Certainly. Certainly. And statements and I can provide additional evidence of that. 

Ms. BROWNLEY. Thank you. And I will yield the balance of my 

time. 

Chairman STEWART. Thank you, Ms. Brownley. 

Mr. Cramer from North Dakota, who has some interest in this, 

I suppose. 

Mr. CRAMER. Yes, thank you, Mr. Chairman, and Ranking Member as well. Thank you to all of the witnesses. Special thank you 

to my friend, Lynn Helms, whose intellect is matched only by his 

integrity as a regulator. 

And I might add that while North Dakota enjoys the fastestgrowing personal per capita income and the lowest unemployment 

rate and a huge budget surplus in the State’s coffers and more jobs 

available then people to fill them, we also were recently ranked by 

the American Lung Association with an A rating for clean air. We 

meet all ambient air quality standards as prescribed by the EPA. 
85 

We have the cleanest water, cleanest land, most productive topsoil 

in the country. We feed a hungry world, and we do it all pretty 

well, and most of the time we would like to tell the Federal Government we will call if we need your help, but they seem to want 

to impose themselves quite regularly. 

I think. as an opening statement beyond that, I want to remind 

the Committee or those of you that maybe don’t know, for nearly 

10 years I was on the North Dakota Public Service Commission, 

carried the pipeline portfolio, have sited billions of dollars and 

thousands of miles worth of pipelines. Perhaps the biggest challenge in that tenure was siting the original Keystone pipeline. We 

talk about this like this is the first time it has been invented, as 

though no one ever thought about moving oil sands to market before. 

The first 260 miles in the United States of the original Keystone 

pipeline are through North Dakota. If you hired Sacajawea to find 

a worse route, she couldn’t have. They chose a lousy greenfield 

route in eastern North Dakota through some of the richest farmland in the country, two scenic rivers, eight counties, 600 landowners, none of whom benefited a bit from oil other than using it 

in their combines and their tractors and heating their homes and 

all the things that we all use oil products for. 

The great part of that experience for me was that, while there 

were 600 landowners involved in the original TransCanada Keystone pipeline, all 600 willingly signed a contract. We did not have 

to go to condemnation for one inch of that pipeline. That is not because we are great regulators or great politicians; it is because we 

have citizens who understand the value of this important product 

and understand it is the safest way to move it. 

Now, it is interesting, perhaps, for somebody from TransCanada 

to hear me expose the virtues of that process, because at the time 

they thought I was the biggest pain in the backside that they had 

ever come across because we did require them to do a lot of things 

that they weren’t necessarily inclined to do, including pulling under 

rivers as opposed to cutting through them. 

But I also think it is important to note that we did have a spill 

at one of the pumping station, but the good news was that after 

the spill everything worked. The SCADA system worked. The balance shut down. Eyewitnesses saw the oil. The berms kept it in. 

The little bit that got out was cleaned up at TransCanada’s expense to the point where PHMSA was satisfied and the health department was satisfied in the Public service commission was satisfied with the repairs to the point that they were up and running 

within days. I think to talk about it as though there would never 

be a spill would be inaccurate, but I think it is also to talk about 

as though a spill is somehow going to ruin the world is also inaccurate. We always want to do better and always can. 

I could talk about a lot of things, including siting the Bridger 

pipeline, which is the onramp to the Keystone XL. And wouldn’t we 

love to have Bakken crude get to that market where they pay a 

premium as opposed to a discount, which is what we get in many 

of the markets? 

That said, I want—I do have a technical question and probably 

start with you, Mr. Helms, anybody else that could help with this. 
86 

We talked about this dilbit or bitumen as though it is some sort 

of a foreign substance, but there has been some disagreement both 

here and in the Natural Resources Committee, and I think the 

E&C Committee as well. Could you tell us the difference and is it 

that dramatically different? Because I really do not know. Mr. 

Helms, if you could, you understand this production as well as anybody. 

Mr. HELMS. Mr. Chairman, Congressman Cramer, I have been to 

the oil sands in Fort McMurray and looked at the dilbit. It is not 

all that different than the crude oil that I produced when I worked 

for Texaco in central Montana and northwestern Montana. Those 

were heavy crude oils that were produced out of the Sawtooth 

sands, and we transported them by truck to Great Falls, Montana, 

and had them refined there. It is not some foreign alien substance. 

It is a mixture of light hydrocarbon and heavy hydrocarbon, and 

you can move it in pipelines or tank trucks or railcars. 

Mr. CRAMER. Mr. McCown, do you have anything to add? 

Mr. MCCOWN. I completely agree with everything Mr. Helms just 

said. 

Mr. CRAMER. Well, then, let me just in my remaining seconds 

cite a couple of other things. I think in situ process is interesting. 

It has become better and better and it always will be. China builds 

coal-fired power plants like we build stick houses. They are not 

going to not build refineries for this stuff. And I have been to 

enough funerals of North Dakota soldiers fighting in the Middle 

East to remind everybody that this is a matter of national security, 

not just economic security. And I yield back. 

Chairman STEWART. Thank you, Mr. Cramer. 

Then it looks like our last questioning from Mr. Veasey. 

Mr. VEASEY. Thank you, Mr. Chairman. 

I wanted to ask Mr. McCown a question about best practices and 

what his opinion was on best industry practices being used to build 

this pipeline. And more specifically, I want to know would somebody be able to come back, you know, after the pipeline is built a 

year later, two years later and say, well, actually, this could have 

been done to make the pipeline safer and even industry agreeing 

to that to a certain extent. 

I know that with some of the environmental issues that we have 

had in the North Texas area, not just with oil and gas but others— 

take, for instance, flaring. Someone will say, well, it is too expensive to pipeline the gas out and so we will just flare it. We know 

environmentally that flaring is not the best thing to do, but sometimes, it is just done for efficiency and for maximizing profits. So 

are the very best practices being used as it relates to the environment and the safety of this pipeline? 

Mr. MCCOWN. That is a very good question. And yes, they are. 

And I share your concern. I have been a planning and zoning commissioner in North Texas where I have voted against pipelines that 

didn’t seem to make sense in places. But yes, the—yeah, the 57 

special conditions that TransCanada has come up with, they did 

that before the passage of the last pipeline safety improvement bill. 

And a lot of the things that are in here are now lost. So they were 

cutting edge ahead of the law. 
87 

I think the key component is to make sure that the regulator not 

only holds them to the highest standard but requires continual refinement of that process. As technology includes—if you look at 

cars 20, 30 years ago, we didn’t have airbags, we didn’t have different things. As technology increases, then we hold the entire infrastructure system accountable as well. But the question isn’t, you 

know, should we rebuild the pipeline? The question is this will be 

the state-of-the-art as we have today far exceeding anything else 

that is out there. And that makes it safer. 

Mr. VEASEY. Mr. Swift, what is your opinion on the best practices 

and this being the safest possible pipeline to move crude? 

Mr. SWIFT. Well, we heard this same language used with regard 

to Keystone I and TransCanada’s natural gas Bison pipeline, both 

constructed in 2010, both with special conditions. Both said they 

were state-of-the-art and would unlikely to spill in the first 30 or 

40 years. And with Keystone I, we saw 14 spills in the first year; 

and with the Bison pipeline, a 60-foot section of it exploded. Now, 

TransCanada was recently put under a sweeping review by Canadian regulators for what one whistleblower, who was a—quality 

control personnel, claims to be systematic violation of minimum 

safety standards in the building of pipelines. 

So, on one hand, we have questions of whether they use the best 

methods available and this—or will they—will the specs be the best 

available? And the second is will they build to spec? And both of 

these issues seem to be a problem with regard to TransCanada. 

And as a final note on these 57 conditions, as Brigham mentioned—as Mr. McCown mentioned, you know, many of the special 

conditions are now minimum safety standards set by the 2012 pipeline safety law. Many of these special conditions are conditions that 

TransCanada was already required to abide by because of the—its 

Canadian sections. So while there are a large number of conditions, 

if you really look at which ones add any, you know, bar above what 

the current bar is, it is a much smaller list. 

Mr. VEASEY. And I would like for Mr. McCown to respond specifically to what Mr. Swift said about the specs. 

Mr. MCCOWN. Sure. Well, there is a lot of spin going on there, 

but the fact that the Canadian portion is built to whatever spec, 

it doesn’t require the U.S. portion to be built to that same spec. 

Two, the—PHMSA oversees the construction and the placement 

and service through its own inspections and through third-party 

validators both that the company uses and PHMSA uses so it is 

built to spec. 

Secondly, you know, when I was at PHMSA, we moved the ‘‘spill 

criteria’’ down to basically, I think, anything more than five gallons. So when people say it was a spill, there is a big difference between a little spill and a big spill, and these numbers get thrown 

around like they are candy and it is a little misleading, frankly. 

Mr. VEASEY. Mr. Chairman, thank you. 

Chairman STEWART. Thank you. All right, thank you. It appears 

that that is the end of our questioning then. I would like to thank 

the witnesses one more time for your valuable testimony and for 

your time, your expertise. We appreciate it. 

To the Members of the Committee, there may be those who have 

additional questions for you, and if that is the case, we will ask you 
88 

to respond to those in writing. The record will remain open for two 

weeks for additional comments and written questions from the 

Members. 

The witnesses are excused and this hearing is now adjourned. 

[Whereupon, at 11:37 a.m., the Subcommittees were adjourned.] 
(89) 

Appendix I 

ANSWERS TO POST-HEARING QUESTIONS
90 

ANSWERS TO POST-HEARING QUESTIONS

June 6~, 2013 

Congress of the United States 

House of Representatives 

Committee on Science, Space and Technology 

2321 Rayburn House Office Building 

Washington, DC 20512 

RE: Questions for the Record 

To Mr. Taylor Jordan, 

Department of Mineral Resources 

Lynn D. Helms - Director 

North Dakota Industrial Commission www,dmr.nd.gov 

Thank you for the opportunity to provide testimony and additional information. 

Following, you will find the committee member's questions with my responses. 

To the Honorable Chris Stewrut: 

1. Mr. Helms, the State Department's analysis concluded that construction of the Keystone 

XL pipeline would support 40,000 jobs. 12,000 of these would be in the project area 

states, and 1,000 more would be associated with the construction of Bakken Marketlink. 

Can you explain what the Marketlink project is and what benefits it will yield for North 

Dakota? 

a Additionally, please discuss how revenue, taxes, and royalties associated with 

production in the Bakken and infrastructure projects like Keystone XL have 

positively impacted (he North Dakota economy and state budget. 

The Bakken Marketlink project is the facility to be constructed in Baker, Montana that will collect, store, and inject 

60,000 to 100,000 barrels of light sweet crude oil produced in eastern Montana and western North Dakota into the 

Keystone XL pipeline. The primary supply mechanism planned for Bakken Marketlink is the Belle Fourche and 

Bridger gathering and transportation pipeline systems. The following benefits to North Dakota have been identified for 

oil transportation by pipeline into and out of Bakken Marketlink: 

1) Reduction of 300 - 500 truck-loads of crude oil per day transported 011 North Dakota highways 

a, Traffic statistics indicate approval of the Keystone Xl pipeline will reduce highway fatalities in North Dakota by 

three to six per year and injury crashes by 85 to 150 annually. 

b. Oil spill statistics indicate approval of the Keystone Xl pipeline will reduce the number of oil spills in North 

Dakota 60 - 80 per year. 

2) Reduction of one to two unit trains per day transporting crude oil from North Dakota. 

a. Calculations show that approval of the Keystone Xl pipeline will result in 450,000- 950,000 Kg/day less greenhouse gas emissions in North Dakota as well as significant decreases in dust. 

600 E Boulevard Ave - Dept 405, Bismarck, North Dakota 58505-0840 Phone (701)328-8020 Fax (701)328-8022 
91 

June 6~, 2013 

Congress of the United States 

House of Representatives 

Committee on Science, Space and Technology 

2321 Rayburn House Office Building 

Washington, DC 20512 

RE: Questions for the Record 

To Mr. Taylor Jordan, 

Department of Mineral Resources 

Lynn D. Helms - Director 

North Dakota Industrial Commission 

www,dmr.nd.gov 

Thank you for the opportunity to provide testimony and additional information. 

Following, you will find the committee member's questions with my responses. 

To the Honorable Chris Stewart: 

1. Mr. Helms, the State Department's analysis concluded that construction of the Keystone 

XL pipeline would support 40,000 jobs. 12,000 of these would be in the project area 

states, and 1,000 more would be associated with the construction of Bakken Marketlink. 

Can you explain what the Marketlink project is and what benefits it will yield for North 

Dakota? 

a Additionally, please discuss how revenue, taxes, and royalties associated with 

production in the Bakken and infrastructure projects like Keystone XL have 

positively impacted (he North Dakota economy and state budget. 

The Bakken Marketlink project is the facility to be constructed in Baker, Montana that will collect, store, and inject 

60,000 to 100,000 barrels of light sweet crude oil produced in eastern Montana and western North Dakota into the 

Keystone XL pipeline. The primary supply mechanism planned for Bakken Marketlink is the Belle Fourche and 

Bridger gathering and transportation pipeline systems. The following benefits to North Dakota have been identified for 

oil transportation by pipeline into and out of Bakken Marketlink: 

1) Reduction of 300 - 500 truck-loads of crude oil per day transported on North Dakota highways 

a, Traffic statistics indicate approval of the Keystone Xl pipeline will reduce highway fatalities in North Dakota by 

three to six per year and injury crashes by 85 to 150 annually. 

b. Oil spill statistics indicate approval of the Keystone Xl pipeline will reduce the number of oil spills in North 

Dakota 60 - 80 per year. 

2) Reduction of one to two unit trains per day transporting crude oil from North Dakota. 

a. Calculations show that approval of the Keystone Xl pipeline will result in 450,000- 950,000 Kg/day less greenhouse gas emissions in North Dakota as well as significant decreases in dust. 

600 E Boulevard Ave - Dept 405, Bismarck, North Dakota 58505-0840 Phone (701)328-8020 Fax (701)328-8022 
92 

Department of Mineral Resources 

Lynn D, Helms ~ Director 

North Dakota Industrial Commission 

www.dmr.nd.gov 

Following are impacts to the economy of North Dakota associated with Bakken production: 

1) The oil and gas industry generated $30.4 billion for North Dakota's Economy in 2011. 

a, Direct impacts of the oil and gas industry were $11.7 billion. 

b. Secondary impacts were $18.7 billion. 

c. For every dollar spent in the state by the oil and gas industry, another $1.59 in additional business activity was 

generated. 

2) The oU and gas industry created nearly 60,000 jobs statewide, 

a. Direct employment of 40,856 full~time jobs or 9% of the state's workforce. 

b. Secondary employment of 18,700 full~time equivalent jobs. 

3) The oil and gas industry contributed $11.6 billion in economy-wide personal income. 

a. $798.1 million in in-state private royalties. 

b. $322 million in lease bonuses. 

4) The oil and gas industry generated $2.65 billion in government revenues. 

a. $1.3 billion in gross production and severance taxes. 

b. $303 million in royalties, including $145 million in state royalties, $40 million in federal royalties returned to 

North Dakota, and $117 in tribal royalties. 

c. $106 million in state and federal lease bonuses. 

d. $454 million in sales and use, corporate and personal income, property, and other taxes. 

e. $86.5 million in licenses, permits, and fees. 

f. $8.5 million in charitable donations. 

g. $395 million in indirect state government general tax collections. 

5) The oil and gas industry benefited other industries and sectors statewide and contributed $7.4 billion in statewide retail 

sales. 

2. The Pipeline and Hazardous Materials Safety Administration holds that pipelines are one 

of the safest and most cost-effective means to transport the extraordinary volumes of 

natural gas and hazardous liquid products that fuel our economy," Can you explain what 

sort of cost and safety trade-offs are being experienced in North Dakota as you try to 

transport crude from the Bakken in the absence of Keystone XL? 

Keystone XL has signed up over 60,000 barrels per day of Bakken crude to tnmsport from Baker, MT to Cushing, OK 

and has committed to carry 100,000 barrels per day. Cnrrently, that production is being trucked from the well sites to 

rail facilities. This is the equivalent of 50 long haul truck loads for each 10,000 barrels. Once Keystone XL is in place, 

those trucked barrels will most likely be connected to a gathering system that will deliver them to Keystone XL 

Approval of Keystone XL will likely cause four things to happen: 

1) 300 - 500 truck-loads per day will be taken off North Dakota highways. 

2) There will be one to two less trains per day leaving North Dakota. 

3) Our calculations show that oil spills from truck transportation occur at three to four times the rate of spills from 

pipelines. Approval of the Keystone Xl pipeline will result in 60 - 80 fewer spills per year, 

4) In the five years from 2006-2011 the number of crashes involving semi-trucks has risen substantially. Fatal crashes 

have more than doubled, injury crashes have more than tripled, and property damage crashes have doubled. The 

rate of fatal crashes has remained constant at 1.4 and injury crashes at 40 per 100 million miles driven. Approval of 

600 E Boulevard Ave - Dept 405, Bismarck, North Dakota 58505-0840 Phone (701)328~8020 Fax (701)328-8022 
93 

Department of Mineral Resources 

Lynn D. Helms - Director 

North Dakota Industrial Commission 

www.dmr.nd.gov 

the Keystone XL pipeline is expected to reduce highway fatalities in North Dakota by three to six per year and injury 

crashes by 85 to 150 annually. 

To the honorable Randy Neugebauer: 

I. The State Department concluded that Canadian oil sands oil would make it to market 

with or without the Pipeline. However, the EPA in its assessment of State's report, 

appeared to question this, and in particular is suspicious of other options, including rail. 

What is the State of North Dakota doing for transport in the absence ofthc pipeline and 

how is rail working to pick up the slack? 

Major shortfalls in pipeline export capacity have resulted in a very unbalanced transportation market for North Dakota 

crude oil. Lack of pipeline capacity in the midcontinent has led to much higher oil prices on the coasts and shifted the 

normal transportation mode away from pipelines to higher risk and impact alternatives such as rail and truck. In 2006. 

I co-authored an analysis of Williston Basin Crude Oil Bottlenecks that concluded transportation by rail would be an 

inefficient, uneconomic, short term solution. As shown by the current North Dakota oil transportation breakdown the 

size of the resource, changing markets, and innovations in the rail transportation industry have resulted in just the 

opposite. Currently. 565,000 barrels per day of North Dakota crude is transported out of state by rail with an additional 

5,000-10,000 barrels per day of sour North Dakota crude trucked into Canada to access pipelines serving the best 

markets for that type of oil while 35,000 barrels per day of sweet Canadian crude oil is being trucked into North Dakota 

to access rail transportation loading facilities serving the best markets for that type of oil. 

2. While the hearing focused largely on the safety and environmental features of the 

pipeline, it is also true that the project will help the U.S. reduce its reliance on oil imports 

from Jess friendly nations like V ~'Ilczucla, and strengthen trade ties with a strong, stable, 

and democratic ally. Can you discuss how Korth Dakota has benefited from trade ties 

with Canada, and what an increased energy partoership might mean for those states that 

have access to and can utilize the pipeline? 

a. Additionally, according to the C.S. Census Bureau, for every dollar the U.S. 

spends on Canadian goods, Canada spends an approxinlate 89 cenl' on U.S. 

goods and services. Would you say that as a state, North Dakota enjoys benefits 

from its trade relationshlp with Canada? 

The US Department of Commerce's International Trade Administration statistical reports show massive trade growth 

between North Dakota and Canada in the last few years. North Dakota exports to Canada are up 560 percent since 

2005 with the oil & gas portion of those exports up 4500 percent in that same time period. In 2005, 45 percent ofND's 

total exports were to Canada; by 2012 it had risen to 71 percent. In other words, North Dakota exported almost two 

and a halftimes as much to Canada than to the rest of the world combined. In 2012,38 percent of North Dakota's 

exports to Canada were oil & gas. Much of those petroleum products re-entered the US to be consumed; this 

demonstrates how integrated the oil industry is between Canada and the USA. 

600 E Boulevard Ave - Dept 405, Bismarck. North Dakota 58505·0840 Phone (701)328·8020 Fax (701 )328·8022 
94 

Department of Mineral Resources 

Lynn D, Helms - Director 

North Dakota Industrial Commission www.dmr.nd.gov 

2012 was the first time in decades (maybe ever) exports from North Dakota to Canada exceeded imports from Canada 

to North Dakota. Other top exports to Canada include; machinery, chemicals, food products, petroleum and coal 

products, agricultural products and transportation equipment. 

Exports to Canada from ND 

Exports of oil & gas to Canada 

Total ND exports 

2005 

$545m 

$26rn 

$1,I92m 

The following statistics are provided by Government of Canada: 

2012 

$3,063m 

$1,183m 

$4,288m 

North Dakota sells more goods to Canada than to all other countries combined (Canada accounts for 71 

percent ofND exports). 

North Dakota 2012 exports to Canada: $3.1 billion (up more than 40 percent over last year -- and less than 

half of this jump is oil). 

Number of North Dakota jobs that depend on trade with Canada: 23,100. 

North Dakota visits by Canadians: 958,800, $255 million spent. 

NOTE- North Dakota population is 700,000- visits by Canadians exceeded the population of North Dakota 

Sincerely, 

Lynn D. Helms 

Director 

North Dakota Industria! Commission 

Department of Mineral Resources 

600 E Boulevard Ave - Dept 405, Bismarck, North Dakota 58505·0840 Phone (701)328~8020 Fax (701)328~8022 
95 

u.s. HOUSE OF REPRESENTATIVES 

COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

Subcommittee on Environment 

Subcommittee on Energy 

Response to Hearing Questions for the Record 

TO: The Honorable Chris Stewart 

Keystone XL Pipeline: Examination a/Scientific and Environmental Issues 

FROM: Brigham A. McCown 

1. You bave been involved in pipeline safety and transportation issues for a 

long time. Have you ever witnessed tbe amount of delay and obstruction with 

regards to a piece of transportation infrastructure as we have witnessed with 

Keystone XL? 

Mr. Chairman, I have never witnessed any similar project having to 

undergo this amount of scrutiny and political wrangling. This project 

has now surpassed 1,700 days of review. To put this delay in contrast, 

the transcontinental railroad was completed in less time, the U.S. and 

its Allies had won World War II in Europe, and the U.S. Civil War 

had come and gone by now. This project has passed numerous 

environmental studies with flying colors and I concur with the State 

Department's assessment that this pipeline will offer a measure of 

safety above and beyond current systems. 

a. To your knowledge, would you say that the review of Keystone XL has 

been more tborougb, exbaustive, and lengtby tban typical permit 

applications for pipeline infrastructure? 

The Keystone XL project is clearly the most scrutinized and carefully 

reviewed pipeline project in our nation's history. Mr. Chairman, I 

would like to mention that the State Department figured out the 

correct answer that there would be no adverse environmental impact 

as early as August of 2011 when it issued the first Environmental 

Impact Statement in accordance with National Environment Policy 

Act ofl972 (NEPA). 
96 

Following revisions to a portion of the initial approved route in 

Nebraska, a Supplemental Environmental Impact Statement (SEIS) 

was issued on March 1,2013. 

The federal government has undertaken a thorough and rigorous risk 

assessment for this project as guided by Executive Order 13337. That 

Executive Order was intended "to expedite reviews of permits as 

necessary to accelerate the completion of energy production and 

transmission projects ... connecting the United States with a foreign 

country .... ,,1 It is my opinion that 13337 has been used to dclay, not 

expedite the review process. 

b. Would it be fair to say that Keystone XL is the more studied pipeline in 

recent history, if not ever? 

Yes indeed. After collaborating with the Departments of Commerce, 

Defense, Energy, Homeland Security, Interior, Justice and 

Transportation, as well as with other agencies such as the EPA, the 

State Department concluded in its EIS that Keystone XL poses little 

to no environmental risk for the U.S. The review process has been 

much more thorough than is typically required of a pipeline project, 

and at this point, it is fair to inform the Committee that the Keystone 

XL is the most extensively reviewed and heavily scrutinized pipelinc 

in the history of our nation. 

2. Mr. McCown, the State Department concluded that the proposed project 

would "have a degree of safety over any other typically constructed domestic 

oil pipeline system under current code" due to the 57 extra conditions agreed 

to by TransCanada. Can you touch on what a few of these special conditions 

or safety features are so we can get a sense of the measures being taken to 

ensure this is a state of the art pipeline? 

1 Executive Order 13337, 69 Fed. Reg. 25299 Qssued April 30, 2004). 
97 

TransCanada and its contractors have voluntarily implemented stateof-the-art safety requirements and guidelines for this pipeline. For 

example, the company has committed to: 

• Higher quality steel properties than required by regulation; 

• Higher quality pipe manufacturing specifications than required 

by regulation; 

• Institution of crack fracture plan above what is required by 

regulation; 

• 

• 

• 

• 

• 

Installation of overpressure controls; 

Advanced control room monitoring which is more prescriptive 

than required under federal law; 

Reduced interval master control/valve spacing; 

Additional Pipe seam quality control to ensure welds are 

stronger than the pipe itself which is more prescriptive than 

industry standards; and 

Stronger pipe than is required for a .72 design factor. 

I believe the Committee will see that the above points represent a few 

of the 57 different ways TransCanada has committed to a 

comprehensive safety plan well above what the industry, and the 

federal pipeline regulators at PHMSA require. 

These actions are illustrative of the good faith efforts by the pipeline 

company to meet and exceed all requests, and frankly, they should be 

commended for going the extra mile when not every pipeline operator 

would show the willingness to do what has been offered here today. 

For a full list of the 57 special conditions, please see the following 

link: 

l!!tJ2:iLkt:yston~pjpS!line-xl.state.gov/documents/organization1205595.pdf 
98 

a. Additionally, can you explain what a "degree of safety over any other" 

means in practical terms? 

Construction of Keystone XL will be undertaken with the utmost 

attention to safety. TransCanada has agreed with PHMSA to employ 

special construction procedures for crossings of roads, highways, and 

railroads that will add additional safety where these transportation 

modes intersect. Additional procedures and protocols have been 

established to ensure appropriate offsets from existing underground 

utilities and safe excavation practices during construction. 

In addition, the line will be remotely controlled from a control center 

that exceeds current federal safety standards and features enhanced 

safety monitoring. This also includes more robust training of control 

room personnel as well as a more robust Leak Detection System 

(LOS) than is required under the CFRs. 

The Committee may like to know that I believe these enhanced safety 

protocols will make the safest form of large volume energy 

transportation even safer. Regardless of how the data is sliced, 

pipelines safely deliver approximately 31 million barrels of crude and 

refined product each and every day of the year. 2 

b. Please discuss the improvements in pipeline safety over the last decade 

and how this has reduced spills and incidents. 

Pipeline operators spent at least $2.7 billion on inspection and maintenance of 

their pipelines over a six-year period, and over $600 million insuring the 

safety of their storage tanks. During the same period, releases have decreased 

by 59% and spill volumcs have decreased by 43%, even as volume 

transported as increased. After an industry integrity management initiative, 

2 This figure does not take into account the volume of energy products transported by 

natural and other gas pipelines. 
99 

incidents caused by corrosion are down 73%, equipment failures down 50%, 

opcrational error down 40% and material and weld failures down 30%. 

The pipeline industry has matured greatly since the mid-1900's and it 

continues to deploy the latest technology to more effectively manage risk. I 

expect this trend to continue in the years to come. 

Pipelines safely transport 11.3 billion barrels of crude and refined petroleum 

product every day with a delivery success rate of 99.999952%. 

While rare, pipeline incidents do occur and when they do, pipeline operators 

work with the U.S. DOT (PHMSA) and the NTSB to determine an incident's 

root cause in order to revamp procedures and regulations. PHMSA has not 

been shy in coming to Congress when it feels additional authority is needed, 

and that includes the ability to levy substantial fines against any operator who 

fails to meet it's corporate and environmental responsibilities. That said, I 

believe TransCanada will safely construct, operate and maintain the Keystone 

Pipeline System. 

c. Additionally, can you speak to the disparity in spill rates for pipelines 

versus rail or truck that Mr. Helms included in his testimony? 

I believe Mr. Helms' information is based upon his experiences in North 

Dakota. The information referenced in my testimony was compiled by the 

U.S. Department of Transportation's Research and Innovative Technology 

Administration, Bureau of Transportation Statistics, which is national in 

character. 

Mr. Chairman, regional variations certainly do occur and with respect to rail 

data, HAZMA T incident levels vary substantially between urban and rural 

areas. I do concur with his testimony that the lack of appropriate pipeline 

infrastructure in the Bakken has led to a significant increase of vehicular and 
100 

rail traffic that if left unchecked, will result in more incidents while also 

taxing and degrading local transportation networks. 
101 

Response to Questions from the Members 

U.S. House of Representatives 

Committee on Science, Space, and Technology 

Subcommittee on Environment 

Subcommittee on Energy 

Hearing Questions for the Record 

The Honorable Chris Stewart 

Keystone XL Pipeline: Examination of Scientific and Environmental Issues 

Paul C. "Chip" Knappenberger 

Assistant Director, Center for the Study of Science 

Cato Institute 

Washington DC 

Question 

1. In Mr. Helm's testimony he stated that greenhouse gas emissions for the transport options are 

higher than those from the pipeline, 1.8 times higher for rail, and 2.9 times higher for trucks. 

Given the volumes of the crude that are now and could in the future be transported by truck and 

rail if the pipeline is not approved, would it be fair to say that it is rejection, not approval of the 

Keystone XL pipeline that would undermine U.S. efforts to reduce its carbon emissions? 

a) Please include any other estimates you may have on the comparison of greenhouse gas 

emissions as the related to transportation of oil by pipeline versus other options like rail and 

truck. 

Response 

I. The Keystone XL pipeline has very little, if any, impact on U.S. carbon emissions. The 17% 

emissions premium associated with the tar sands oil compared with the average barrel of oil in 

the U.S. system, almost entirely arises from the oil extraction process (which occurs in Canada). 

Once extracted, there is very little difference in the carbon dioxide footprint from the tar sands 

oil compared with any other oil. Gasoline refined from tar sands oil produces virtually the same 

amount of carbon dioxide when burned as does gasoline refined from any other type of oil. So 

U.S. carbon dioxide emissions are largely unaffected by Canada's development of its tar sands. 

Canadian (and global) carbon emissions may increase by producing oil from the tar sands, but 

not U.S. emissions (the total U.S. petroleum consumption is not expected to be impacted by the 

tar sands oil). 

There is the very small exception to the above, which concerns the carbon dioxide emissions 

produced in the U.S. by the transportation of the tar sands crude to U.S. refineries. As far as oil 

transportation goes, on a ton/mile basis carbon dioxide emissions produced by pipeline 
102 

operations are lower than those produced by rail or truck transport. Whether or not denying the 

pipeline would undermine U.S. effort to reduce U.S. carbon dioxide emissions depends on 

whether, in the absence of the pipeline, the tar sands oil were transported via other methods to 

U.S. Gulf Coast refineries in amounts equal to the volume that the pipeline would have 

delivered, or whether the tar sands oil is delivered to other foreign interests outside of the U.S. 

(i.e., is not transported across the U.S.). 

In the Draft Supplemental Environmental Impacts Statement (SEIS), the State Department 

analyzed the greenhouse gas emissions resulting from an alternative transportation scheme (a 

combination of trucks, rail, and existing pipelines) and found that greenhouse gas emissions from 

transportation of the crude were 8% higher than the operation of the Keystone XL pipeline. If 

trucks were used exclusively, instead of rail, in the same scenario, the additional greenhouse gas 

emissions would be, according to my calculation, some 250% percent higher. However, 

greenhouse gas emissions from the transportation of the tar sands crude oil only make up about 2 

percent of the overalllifecycle greenhouse gas emissions of the tar sands oil. Consequently, the 

mode of transport has little impact on the overall greenhouse gas emissions (and hence climate 

change). By the numbers, there would be essentially no difference in wells-to-wheels (WTW) 

greenhouse gas emissions between the Keystone XL and the State Departments rail/pipeline 

scenario, why relying on a truck/pipeline scenario would increase overall WTW emissions by-2 

percent. 

la. 

Additional information on greenhouse gas emissions related to the mode of transportation of 

crude oil can be found in the State Department draft SEIS in Sections 4.12.3.2,5.1.2.12, and 

AppendixZ. 

Question 

2. One of the anti-Keystone groups has a slogan that goes something along the lines of "Stop 

Keystone XL! Stop climate change!" Given your analysis, would you agree that by stopping 

Keystone XL, we would be stopping climate change? 

b. Additionally, this group and many other suggest that Keystone XL is the key to unlocking 

the oil sands. Do you believe that production of the oil sands will continue regardless of 

whether or not Keystone XL is built? 

Response 

2. As my analysis described in my written testimony shows, the Keystone XL pipeline produces 

a climate change so exceedingly small-about one ten-thousandths of a degree Celsius 

(0.0001°C), or less-that it is of no consequence whatsoever. So stopping the pipeline has no 

impact on the course of future climate change, human-caused or otherwise. 
103 

Æ 

2a. In my opinion, the development of the Alberta tar sands will progress with or without the 

approval of the Keystone XL pipeline. It comes down to simple supply and demand. While 

the global demand for petroleum produces remains high, new, competitive supply (such as 

the Alberta tar sands) will increasingly come to market. The specifics of how it gets to 

market may not he worked out, hut the economic incentives are too great for the tar sands not 

to be produced.