A Systems Analysis of Keystone XL Pipeline

GROUP 15/ CEE 3000A

ARMAN YOSAL

GABRIEL MARTINEZ

JOSIA TANNOS

TOMMY KURNIAWAN

NOVEMBER 13, 20141

Content

Background and Purpose

Functional Characteristics

Quantified Impacts:

Economic

Environmental

Social

Politics

Sustainability Analysis

Sustainability Recommendations

Limitations of Analysis

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Background and Purpose (1)

N

Figure 1: Proposed Route [1]

The Keystone Pipeline is owned by TransCanada.

Keystone XL is the fourth phase of the Keystone Pipeline.

Runs from Alberta, Canada to Steele City, Nebraska.

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Background and Purpose (2)

Figure 2: Map with sources and estimated loads [2]

First proposed in 2008, but was rejected.

Reapplied for Presidential Permit in 2012 with new route.

Will transport synthetic crude oil, diluted bitumen, and light crude oil.

Meant to tackle consumer (refineries) demand for oil, especially heavy oil.

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Functional Characteristics (1)

Length: 1,897 km (1,179 mi)

Diameter: 914 mm

Capacity: 830,000 bpd

Components:

Carbon steel.

Fusion-bonded epoxy.

Cathodic protection.

Pumps and pump stations.

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Figure 3: Assembly of the Gulf Coast Project. [3]

Functional Characteristics (2)

Carbon Steel

Harder and stronger than stainless steel.

Withstand impact from 65-ton excavator with 3.5-inch teeth.

Figure 4: Carbon steel pipeline. [4]

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Functional Characteristics (3)

Fusion-bonded epoxy coating

Protects steel pipe from corrosion.

Steel cleaned

and heated.

FBE powder

sprayed and

melt on surface.

Figure 5: FBE process. [5]

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Functional Characteristics (4)

Cathodic Protection

Prevents corrosion.

Impressed current cathodic protection.

Corrosion is passed on from the pipeline’s metal to the similar metal by making the pipeline’s metal a cathode in the electrochemical cell.

Figure 6: Cathodic protection for pipeline. [6] 8

Functional Characteristics (5)

Pumps and Pump Stations

41 pumps stations separated by about 80 kilometers from each other.

Powered by 6,500 horsepower electric motor.

32,000 horsepower of pumping power.

Facilitates the movement of oil within the pipeline.

Figure 7: Pump Station. [7]

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Quantified Impacts: Economic (1)

Positive➢ Raises the cost of oil for all Canadian crude (increased production).

➢ Providing United States a more stable supply of oil and therefore

cheaper source of fuel.

➢ Makes the U.S less reliant on foreign imports, especially from

unstable nations.

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Quantified Impacts: Economic (2)

Positive➢ Stimulates local small businesses.

Boosts GDP of both the United

States and Canada.

➢ Creates approximately 42,100

direct and indirect jobs for local

communities (lodging, food

services, transportation,

warehousing, etc.).

Figure 8: Jobs Distribution. [8]

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Quantified Impacts: Economic (3)

Negative➢ Mainly creates temporary jobs to the communities.

➢ Decreases investment in renewable energy.

• Renewable energy creates more job.

• 16.7 vs. 5.3 jobs.

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Quantified Impacts: Environmental (1)

Positive➢ No carbon emission from rails or other conventional transportation

methods.

○ 440 – 480,000 tons CO2/year.

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Quantified Impacts: Environmental (2)

Negative➢ Huge amount of carbon emitted to the atmosphere after completion.

○ Construction: 0.24 million tons CO2/year.

○ Operation: 1.44 million tons CO2/year.

○ Total: 147 – 186 million tons CO2/year.

○ Climate change.

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Quantified Impacts: Environmental (3)

Figure 9: Carbon dioxide saved vs. Carbon dioxide produced. 15

Quantified Impacts: Environmental (4)

Negative➢ Water pollution.

○ Ogallala Aquifer.

➢ Forest destruction and soil contamination.

○ Boreal forests of Alberta – the world’s largest intact ecosystem.

○ Damaged soil.

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Quantified Impacts: Social (1)

Positive➢ Ensures the US a steady supply of oil.

○ Keeps gas prices low.

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Quantified Impacts: Social (2)

Negative

➢ Disrupts activities in other sectors.

○ Farmers/ Ranchers (571,000 workers -> $76 billion).

○ Tourism (780,000 workers ->$67 billion).

➢ Disrupts private landowners and aboriginal tribes.

○ 93% land used is private land.

○ Controversy of Eminent Domain.

○ Rosebud Sioux Tribe (South Dakota).

○ First Nations (Canada).

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Quantified Impacts: Politics (1)

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Positive➢ Strengthens political relations between the Canadian and American

government.

Quantified Impacts: Politics (2)

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Negative➢ Increases resentment within the growing environmentally aware

public sphere.

➢ Could lead to more conflict within the current divided government

(e.g. shutdown, lame ducks, etc.).

➢ Gives oil companies a platform to promote the use of oil.

System is NOT sustainable.

Sustainability Analysis (1)

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Sustainability Analysis (2)Positive Negative

Economic • Energy security. Less dependence on overseas oil and assured steady supply.

• Creates jobs.• Stable flow of oil.• Boosts GDP and

stimulates local businesses.

• Most jobs are temporary.

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Sustainability Analysis (3)Positive Negative

Political • Strengthens political ties between Canada and the US.

• Exacerbates an already negative public environment.

• Increased intergovernmental conflicts.

Social • Keeping gas price low. • Disrupts local landowners, farmers, ranchers, indigenous tribes, and tourists.

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Sustainability Analysis (4)Positive Negative

Environmental • Fewer carbon emissions with respect to transportation methods.

• During construction and operations, there is a lot of carbon pollution.

• Disruption of local Alberta ecosystem.

• Ogallala aquifer has the potential to be polluted.

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Focus on improving the extraction method of tar sands to trap more of

the resulting chemicals.

Make it a point to reinforce pipes, especially around the Ogallala

aquifer.

Compensate Landowners fairly or even generously.

Be environmentally friendly.

Sustainability Recommendations

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The Keystone XL hasn’t begun construction.

All sources provide data based on projections instead of actual

performance.

Limitations of analysis

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References

http://keystone-xl.com/about/the-keystone-xl-oil-pipeline-project/

http://pubs.acs.org/doi/pdf/10.1021/es303238z

http://www.businessweek.com/articles/2013-10-24/keystone-pipelines-gulf-coast-leg-will

-soon-be-delivering-oil

http://fuelfix.com/blog/2014/01/22/transcanada-begins-oil-deliveries-through-keystone-xl

-southern-leg/

http://www.cepa.com/wp-content/uploads/2012/11/e-fusion-bonded-epoxy.gif

http://www.water.ca.gov/groundwater/well_info_and_other/california_well_standards/fig

ures/74-90fig5.jpg

http://keystone-xl.com/wp-content/uploads/2013/11/Keystone-XL-Pump-Stations-Fact-S

heet-Oct-2013-FINAL.pdf

http://energytomorrow.org/blog/2014/february/~/media/EnergyTomorrow/blog/14-Febru

ary/Reduced%20KXL%20jobs%20by%20industry%20and%20earnings%2012014.j

pg27