Keystone XL Pipeline Supplemental Environmental Impact Statement Executive Summary

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    TransCanada submed a new applcaon or e Keysone XL Projec on May 4, 2012. On Marc 1, 2013 eU.S. Deparmen o Sae (e Deparmen) released a Drat Supplemenal Envronmenal Impac Saemen(Drat SEIS) or e proposed projec a s conssen w e Naonal Envronmenal Polcy Ac (NEPA).

    he proposed Keysone XL projec consss o a 875-mle long ppelneand relaed acles o ranspor up o 830,000 barrels per day (bpd) ocrude ol rom Albera, Canada and e Bakken Sale Formaon nMonana. he ppelne would cross e U.S. border near Morgan, Monanaand connue roug Monana, Sou Dakoa, and Nebraska were would connec o exsng ppelne acles near Seele Cy, Nebraska oronward delvery o Cusng, Oklaoma and e Texas Gul Coas regon. 1

    A prevous applcaon rom TransCanada or a Keysone XL projec (2008applcaon) was or a ppelne a would ave been more an 1.5 mese leng o e curren proposal (1,384 mles), w nearly dencalroues n Monana and Sou Dakoa. he Fnal Envronmenal ImpacSaemen or a proposal was ssued by e Deparmen on Augus

    26, 2011 (2011 FEIS). A perm or e 2008 applcaon was dened.he pendng applcaon proposes a new roue roug Nebraska.Speccally, e roue as been canged o avod e envronmenallysensve area known as e Sand Hlls as oically dened by e NebraskaDeparmen o Envronmenal Qualy (Nebraska DEQ) (See map, let).

    Some addonal dferences beween e 2008 applcaon and e currenKeysone XL applcaon currenly under revew by e Deparmen aresummarzed n e ollowng car.

    Newly Proposed Project v. 2008 Proposed Project

    Newly Proposed Projec 2008 Proposed Projec

    Number o Saes Crossed by

    Ppelne

    3 5

    Leng o New Ppelne (mles) 875 1,384

    NDEQ-Idened Sand Hlls

    Regon Crossed (mles)

    0 90

    Surace Waerbodes Crossed 56 317

    The 2008 Application

    As par o s revew o e 2008 applcaon, e Deparmen deermned n November 2011 aenvronmenal concerns, ncludng ose rased by e Sae o Nebraska, requred addonal normaono ensure complee and ransparen evaluaon o alernave roues, speccally wn Nebraska, awould avod e Sand Hlls. Congress subsequenly ncluded a provson n e Temporary Payroll Tax CuConnuaon Ac a soug o requre a decson on e Perm wn 60 days. ha deadlne dd noallow suicen me o prepare a oroug, rgorous and ransparen revew o an alernave roue rougNebraska. As suc, e Presdenal Perm was dened.

    1Keysone s buldng a separae ppelne roug Oklaoma and Texas a ermnaes n e Texas Gul Coas regon (e Gul Coas Projec) a ollows e

    souern poron o er prevous applcaon. he Gul Coas Projec does no requre a Presdenal Perm because does no cross an nernaonal border.

    KEYSTONE XL PIPELINE EVALUATION PROCESS FACTSHEET 2013

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    The 2012 Application

    he Deparmen s currenly revewng an applcaon submed by TransCanada n May 2012. hs DratSEIS presens an mpac assessmen a, were approprae, draws upon e analyss released n Augus2011 or e 2008 applcaon. he Drat SEIS analyzes e newly proposed roue, and presens expandedand updaed normaon, especally w regard o e revsed proposed roue roug Nebraska, as well assgncan new crcumsances or normaon a s now avalable or e enre roue.

    Followng e recep and publcaon o e May 2012 applcaon, e Deparmen asked or publc

    commen on e scope o e Drat SEIS. hese commens, as well as commens rom oer governmenagences, were aken no consderaon wn e Drat SEIS.

    Nebraska Review

    he Deparmen and e Nebraska DEQ sgned a Memorandum o Undersandng n May 2012 o ensurecoordnaon o e Sae and Federal revew efors. he Sae o Nebraska released s revew o eproposed roue, based on er law, n December 2012. he Governor o Nebraska approved e new roueroug Nebraska n January 2013. he Deparmen runs a complemenary process on e enre rouea s broader n scope and conssen w NEPA. he seps o e Federal process and e Nebraskaprocess are summarzed below.

    Once e Drat SEIS s noced n e Federal Regser, a 45-day publc commen perod wll begn.A publc meeng wll be eld durng e commen perod n Nebraska a a dae and locaon o bedeermned. As par o e Deparmens process, members o e publc, publc agences, and oer

    neresed pares are encouraged o subm commens, quesons, and concerns abou e projec vae-mal o:

    [email protected], a http://www.keystonepipeline-xl.state.gov/

    or maled o:

    U.S. Department of State

    Attn: Genevieve Walker, NEPA Coordinator

    2201 C Street NW, Room 2726

    Washington, D.C. 20520

    Ater e commen perod, approprae revson o e drat, and subsequen publcaon o e Fnal SEIS,e Deparmen wll lead an ner-agency nqury no weer e proposed Projec serves e naonalneres. he naonal neres deermnaon by e Deparmen nvolves consderaon o many acors,ncludng energy secury; envronmenal, culural, and economc mpacs; oregn polcy; and complancew relevan ederal regulaons and ssues. Durng s me e Deparmen wll consul w, a leas,e eg agences dened n Execuve Order 13337 (Aprl 30, 2004). he eg agences dened ne Execuve Order are e Deparmens o Deense, Jusce, Ineror, Commerce, Transporaon, Energy,Homeland Secury and e Envronmenal Proecon Agency.

    For updaes and urer normaon please vs: http://www.keystonepipeline-xl.state.gov

    http://%20http//www.keystonepipeline-xl.state.gov/http://%20http//www.keystonepipeline-xl.state.gov/http://%20http//www.keystonepipeline-xl.state.gov/http://%20http//www.keystonepipeline-xl.state.gov/
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    United States Department of StateBureau of Oceans and InternationalEnvironmental and Scientific Affairs

    DraftSupplementalEnvironmentalImpactStatement

    for the

    Keystone XL ProjectExecutive Summary

    March 2013

    Applicant for Presidential Permit: TransCanada Keystone Pipeline, LP

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    UnitedStatesDepartmentofState DraftSupplementalEnvironmentalImpactStatement

    Forthe

    KEYSTONE XL PROJECTApplicantforPresidentialPermit:

    TransCanadaKeystonePipeline,LP

    GenevieveWalkerNEPAContact&ProjectManager

    UnitedStatesDepartmentofState

    BureauofOceansandInternationalEnvironmental

    andScientificAffairs2201CStreetNW,Room2726

    Washington,DC20520

    Cooperating AgenciesU.S.ArmyCorpsofEngineers(USACE)

    U.S.DepartmentofAgricultureFarmServiceAgency(FSA) U.S.DepartmentofAgricultureNaturalResourceConservationService(NRCS)

    U.S.DepartmentofAgricultureRuralUtilitiesService(RUS)

    U.S.DepartmentofEnergy(DOE) U.S.DepartmentofInteriorBureauofLandManagement(BLM)

    U.S.DepartmentofInteriorNationalParkService(NPS)

    U.S.DepartmentofInteriorU.S.FishandWildlifeService(USFWS)

    U.S.DepartmentofTransportationPipelineandHazardousMaterialsSafetyAdministration,OfficeofPipelineSafety(PHMSA)

    U.S.EnvironmentalProtectionAgency(USEPA)

    Assisting AgenciesU.S.DepartmentoftheInterior,BureauofReclamation(BOR)

    NebraskaDepartmentofEnvironmentalQuality(NDEQ) VariousStateandLocalAgenciesinMontana,SouthDakota,Nebraska,andKansas

    March1,2013

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    Keystone XL Project Executive SummaryDraft Supplemental EIS

    TABLE OF CONTENTS

    ES.1 Introduction 1

    ES.1.1 Overview 1

    ES.1.2 Project Description 2ES.1.3 Alternatives 2

    ES.1.4 Findings 2

    ES.2 Context 3

    ES.2.1 Purpose and Need 3

    ES.2.2 Crude Oil Overview 3

    ES.2.3 Market Overview 3

    ES.3 EIS Development Process 4

    ES.3.1 Presidential Permitting Process 4

    ES.3.2 Supplemental EIS Process 4

    ES.4 Project Description .4

    ES.4.1 Keystone XL Project 4

    ES.4.2 Changes Since the Final EIS 6

    ES.4.3 Connected Actions 7

    ES.5 Environmental Analysis 8

    ES.5.1 Soils 8

    ES.5.2 Water Resources 9

    ES.5.3 Threatened and Endangered Species 11

    ES.5.4 Socioeconomics and Environmental Justice 13

    ES.5.5 Greenhouse Gas Emissions and Climate Change 14

    ES.5.6 Potential Releases 16

    ES.5.7 Cumulative Effects 18

    ES.5.8 Environmental Impacts in Canada 18

    ES.6 Alternatives 18

    ES.6.1 Scenario Screening 18

    ES.6.2 Market Analysis 19

    ES.6.3 No Action Alternative 20

    ES.6.4 Major Pipeline Route Alternatives 21

    ES.6.5 Other Alternatives Considered 22

    ES.7 Next Steps 23

    ES.8 Draft Supplemental EIS Contents 23

    Table of Contents i March 2013

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    Keystone XL Project Executive SummaryDraft Supplemental EIS

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    Figures

    FigureES-1:ProposedKeystoneXLProject 2

    FigureES-2:ProposedProjectOverview 5

    FigureES-3:KeystoneXL,TypicalPipelineConstructionSequence 6

    FigureES-4:SandHillsGrassland 7

    FigureES-5:ComparisonofProposedProjectRoutetoPreviouslyProposedProjectSegment 7

    FigureES-6:CrossSectionofHorizontalDirectionalDrillingMethod 9

    FigureES-7:SchematicHydrogeologicCross-SectionalongProposedPipelineRoute 11

    FigureES-8:AmericanBuryingBeetle 12

    FigureES-9:GreaterSage-Grouse 12

    FigureES-10:WesternPrairieFringedOrchid 13

    FigureES-11:SpillVolumeDistributionbyPipelineComponent 17

    FigureES-12:TypicalRailLoadingFacilityinNorthDakota 21

    Tables

    Table of Contents ii March 2013

    TableES-1:EffectsofPotentialReleasesonAquifers 10

    TableES-2:SpillScenariosEvaluatedinDraftSupplementalEIS 16

    TableES-3:SummaryofPHMSADatabaseIncidents(January2002toJuly2012) 16

    20 TableES-4:SummaryofNoActionAlternativeScenarios

    TableES-5:SummaryofMajorPipelineRouteAlternatives 22

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    Keystone XL Project Executive SummaryDraft Supplemental EIS

    ES.1 INTRODUCTION

    ES.1.1 OverviewTheproposedKeystoneXLPipelineisanew

    875-milepipelineinfrastructureprojectthatwould

    allowdeliveryofupto830,000barrelsperday(bpd)

    ofcrudeoilfromAlberta,Canada,andtheBakken

    ShaleFormationintheUnitedStatestoSteeleCity,

    NebraskaforonwarddeliverytoCushing,Oklahoma,

    andrefineriesintheGulfCoastarea1

    1TheGulfCoastareareferstotheregionfromHouston,Texas,toLakeCharles,Louisiana.

    .TransCanada

    KeystonePipeline,LP(Keystone)hasappliedfora

    PresidentialPermitwhich,ifgranted,would

    authorizetheproposedpipelinetocrosstheUnited

    States-Canadianborder.

    Forproposedpetroleumpipelinesthatcross

    internationalbordersoftheUnitedStates,the

    President,throughExecutiveOrder13337,directsthe

    SecretaryofStatetodecidewhetheraprojectisin

    thenationalinterestbeforegrantingaPresidentialPermit.Thenationalinterestdeterminationbythe

    U.S.DepartmentofState(theDepartment)involves

    considerationofmanyfactors,includingenergy

    security;environmental,cultural,andeconomic

    impacts;foreignpolicy;andcompliancewith

    relevantfederalregulations.Beforemakingsucha

    decision,theDepartmentalsoasksfortheviewsof

    theDepartmentsofEnergy,Defense,Transportation,

    HomelandSecurity,Justice,Interior,andCommerce,

    andtheU.S.EnvironmentalProtectionAgency.

    Background

    Previously,Keystonesubmittedanapplicationforthe

    samebordercrossing,butwithapipelinerouteinthe

    UnitedStatesthatdifferedfromtheroutethatis

    currentlyproposed.Thebiggestdifferenceinthe

    previousroutecomparedtothecurrentoneisthatit

    wentthroughtheSandHillsRegionofNebraskaas

    identifiedbytheNebraskaDepartmentof

    EnvironmentalQuality(NDEQ).Aseparate

    EnvironmentalImpactStatementwasissuedin

    August2011forthatroute.InNovember2011,the

    Departmentdeterminedthatadditionalinformation

    wasneededtofullyevaluatetheapplication,in

    particular,additionalinformationaboutalternativerouteswithinNebraskathatwouldavoidtheSand

    HillsRegion.InlateDecember2011,Congress

    adoptedaprovisionoftheTemporaryPayrollTax

    CutContinuationActthatsoughttorequirethe

    PresidenttomakeadecisiononthePresidential

    Permitforthatroutewithin60days.Thatdeadline

    didnotallowsufficienttimetoprepareathorough,

    rigorous,andtransparentreviewofanalternative

    routethroughNebraska.Assuch,thePresidential

    Permitwasdenied.

    InFebruary2012,KeystoneinformedtheDepartment

    thatitconsideredtheGulfCoastportionofthe

    previouspipelineproject(fromCushing,Oklahoma,totheGulfCoastarea)tohaveindependenteconomic

    utilityandindicateditintendedtoproceedwith

    constructionofthatpipelineasaseparateproject,the

    GulfCoastProject.TheGulfCoastProjectdoesnot

    requireaPresidentialPermitbecauseitdoesnotcross

    aninternationalborder.ConstructionontheGulf

    CoastProjectisunderway.

    OnMay4,2012,KeystonefiledaPresidentialPermit

    applicationforanewKeystoneXLProject.The

    proposedProjecthasanewrouteandanewstated

    purpose.TherouteinMontanaandSouthDakota

    wouldbelargelyunchangedfromtherouteanalyzedinAugust2011.However,thenewlyproposedroute

    notonlyavoidstheNDEQ-identifiedSandHills

    RegionbutalsoterminatesatSteeleCity,Nebraska,

    andthusisapproximatelyhalfthelengthofthe

    previouslyproposedprojectanalyzedin2011.In

    otherwords,thenewlyproposedProjectis509miles

    shorterthanthepreviouslyproposedprojectanalyzed

    in2011.

    About the Draft Supplemental Environmental Impact

    Statement

    TheDepartmenthasissuedthisdraftSupplemental

    EnvironmentalImpactStatement(draftSupplemental

    EIS)thatbuildsontheanalysiscompletedinAugust

    2011(theFinalEnvironmentalImpactStatementor

    FinalEIS).Theanalysishasbeenrevised,expanded,

    andupdatedtoincludeacomprehensivereviewof

    thenewrouteinNebraskaaswellasanysignificant

    newcircumstancesorinformationthatisnow

    availableonthelargelyunchangedroutethrough

    MontanaandSouthDakota.

    IncompletingthedraftSupplementalEIS,the

    Departmenttookintoconsiderationthecomments

    containedinmorethan400,000e-mails,letters,and

    othercommunicationssubmittedthroughoutthescopingprocessbypubliccitizens,government

    agencies,Tribalgovernments,andinterestednon-

    governmentalorganizationsaswellasoverone

    millione-mails,letters,andothercommunications

    submittedtotheDepartmentduringitsconsideration

    ofthepreviousKeystoneXLapplication.

    Executive Summary ES-1 March 2013

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    Keystone XL Project Executive SummaryDraft Supplemental EIS

    Expandedandnewanalysesinclude,amongothers:

    economiceffectsoftheproposedproject,impacts

    frompotentialreleasesorspills,impactsrelatedto

    climatechange,andcumulativeeffectsfromthe

    proposedprojectincombinationwithotherprojects.

    TheDepartmentre-examinedandexpandedthe

    evaluationofprojectalternatives,includingareasonableroutealternativeandotherscenariosof

    crudeoiltransport,suchasrail.TheDepartmentalso

    updatedtheanalysisoftherelationshipofthe

    proposedprojecttocrudeoilmarketsinlightof

    developmentssinceAugust2011,whichincludesan

    updatetotheassessmentofwhethertheproposed

    Projectislikelytoimpacttheextractionratefromthe

    oilsandsinCanada,andthusimpactgreenhousegas

    (GHG)emissionsassociatedwiththatextraction.

    TheExecutiveSummaryonthefollowingpages

    brieflypresentsthecontentsofthedraft

    SupplementalEIS,includingthepurposeandneedoftheproposedProject,keypotentialimpacts,measures

    toreduceormitigatethoseimpactsifapermitwas

    granted,andalternativestotheproposedProject.

    ES.1.2 Project DescriptionTheproposedKeystoneXLPipelineProjectconsists

    ofa36-inchpipelineandrelatedfacilitiesthatwould

    allowfortransportofupto830,000bpdofcrudeoil

    fromtheWesternCanadianSedimentaryBasin

    (WCSB)inAlberta,Canada,andfromtheWilliston

    Basin(Bakken)regioninMontanaandNorthDakota,

    primarilytorefineriesintheGulfCoastarea.Thereis

    existingdemandforcrudeoil,particularlyheavycrudeoilatrefinersintheGulfCoastarea,butthe

    ultimatedispositionofcrudeoiltransportedbythe

    proposedProject,andanyrefinedproductsproduced

    fromthatcrudeoil,wouldbedeterminedbyfuture

    marketforces.

    ThisdraftSupplementalEISevaluatesthe875-mile

    pipelinethatwouldstretchfromtheU.S.-Canadian

    bordernearMorgan,Montana,totheexisting

    KeystonepipelineinSteeleCity,Nebraska.Asnoted

    above,thedraftSupplementalEISbuildsonand

    supplementstheanalysiscompletedinAugustin

    2011byspecificallyaddressingthenewrouteinNebraskaaswellasanysignificantnewinformation

    thathassincebecomeavailable.

    Figure ES-1: Proposed Keystone XL Project

    ES.1.3 AlternativesInadditiontominorroutevariationsandpipeline

    designoptions,thedraftSupplementalEISconsiders

    thefollowingalternativestotheproposedProject.

    The No Action Alternative evaluatesscenariosthatarelikelytooccuriftheproposedProjectisnotbuilt,includingrailandvessel-basedoptionsfortransportingWCSBandBakkencrudeoiltotheGulfCoast.

    Major Route Alternatives evaluatetheimpactsofchangingtherouteofthepipeline.Specificalternativesincludetheroutepreviously

    proposedaswellasaroutethatparallelsInterstate90inSouthDakotabeforejoiningtheright-of-way(ROW)oftheexistingKeystonepipeline.

    ES.1.4 FindingsChapter4ofthedraftSupplementalEISgives

    detailedfindingsabouttheproposedProjects

    impacts.Amongtheseareresourceswhereimpacts

    couldpotentiallybesubstantial,orthathavebeenthe

    focusofsignificantpublicattentionandcomment.

    Thesekeyresourceareasinclude:

    Soils(includingsandyanderodiblesoils); Groundwater,includingaquiferssuchasthe

    OgallalaAquifer;

    Surfacewaterresources;

    Socioeconomics,includingthepotentialjobandrevenuebenefitsoftheproposedProject,aswellasconcernsaboutenvironmentaljustice;

    Executive Summary ES-2 March 2013

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    LifecycleGHGemissionsassociatedwithoilsandsdevelopment,refining,andconsumption;and

    Potentialreleasesorspills.

    ES.2 CONTEXT

    ES.2.1 Purpose and NeedTheDepartmentmustdetermineiftheproposed

    Projectisinthenationalinterestpursuantto

    ExecutiveOrder13337.TheDepartmentevaluates

    theproposedProjectspurposeandneedconsistent

    withtheNationalEnvironmentalPolicyAct(NEPA).

    AccordingtotheapplicationsubmittedbyKeystone,

    theprimarypurposeoftheproposedProjectisto

    providetheinfrastructuretotransportheavycrudeoil

    fromtheborderwithCanadatodeliverypointsinthe

    UnitedStatesbyconnectingtoexistingpipeline

    facilitiesnearSteeleCity,Nebraska.TheproposedProjectismeanttorespondtothemarketdemandof

    refineriesforheavycrudeoil.TheproposedProject

    wouldalsoprovidetransportationforlightcrudeoil

    fromtheBakkeninNorthDakotaandMontana(as

    wellasfromCanada).

    TheproposedProjectwouldhavethecapacityto

    deliverupto830,000bpd.Keystonehasrepresented

    thatithasfirmcommitmentstotransport

    approximately555,000bpdofheavycrudeoilfrom

    producersintheWCSB.Inaddition,Keystonehas

    representedthatithasfirmcommitmentstotransport

    65,000bpdofcrudeoilfromtheBakkenofthe100,000bpdofcapacitysetasideontheproposed

    Projectforthatpurpose.Theultimatemixtureand

    quantityofcrudeoilstransportedbytheproposed

    Projectoveritslifetimewouldbedeterminedby

    futuremarketforces.

    ES.2.2 Crude Oil OverviewOilproducerssendavarietyofcrudeoilstorefiners

    toproduceconsumerproductssuchasgasoline,

    dieselfuelfortrucks,heatingoil,andrawmaterials

    forplasticsandmedicines.EachU.S.refineryhas

    differenthardwareequipmentandcapacity,

    metallurgy,andtreatingprocessesanddifferent

    resultingmixesoffinishedproducts.

    TheproposedProjectwouldprimarilytransportcrude

    oilfromtheWCSBandBakkenregions.The

    majorityoftheoilfromWCSBsourcesisconsidered

    aheavycrudeoil,whileBakkencrudeisconsidereda

    lightcrudeoil.Ingeneral,refineriesintheGulfCoast

    areaaredesignedtoprocessamixtureofheavyand

    lightcrudes.Therefineriesinthatregionpossessone

    ofthehighestconcentrationsofheavy-cruderefining

    capacityofanyareaintheworld.GulfCoastrefiners

    usebothdomesticcrudeoilproducedintheUnited

    States,andcrudeoilimportedfromforeigncountries

    tocreatevariouspetroleumproducts.

    ThecrudeoilfromtheWCSBisproducedasaviscousmaterial,knownasrawbitumen,thathasthe

    consistencyofsoftasphalt.Duetoitsviscosity,

    bitumencannotbetransportedbypipelineonitsown.

    Itfirstmustbemixedwithapetroleum-basedproduct

    (calledadiluent),suchasnaphthaornaturalgas

    condensate,tomakealessviscousliquidcalled

    dilbit;oritmustbeupgraded(partiallyrefined)toa

    mediumweightcrudeoilcalledsyntheticcrudeoil.

    Ifdiluentsarenotavailable,producersusesynthetic

    crudeoilasthediluenttocreateaproductcalled

    synbit.TheproposedProjectisexpectedtocarry

    predominantlyeitherdilbit,synbit,orboth,aswellassyntheticcrudeoilandlightcrudeoilproducedfrom

    theBakken.

    ES.2.3 Market OverviewRefinersdeterminetheoptimalcrudestoprocess

    similartoothermanufacturingcompaniesthatselect

    therightrawmaterialstomanufactureproducts.

    Refiningcompaniespaymarketpricesforcrudeoil,

    andmeasuretheirprofitabilitybasedonsellingtheir

    productintothewholesalemarket.Theythenusethat

    margin(thedifferencebetweenthepriceofcrudeand

    thepriceoftherefinedproducts)tocovertheir

    expensesandgenerateprofits.Refinersmayselectamoreexpensivecrudeoilifthatcrudeoilsyield

    providesagreatermarginthanacheapercrudeoil.

    TheproposedProjectseekstocapitalizeonthe

    demandsofrefinersforastablesupplyofbothheavy

    andlightcrudeoil.RefineriesintheGulfCoastrely

    mostlyonforeignimports,particularlyfrom

    VenezuelaandMexico,aswellasfromother

    countries.However,thevolumeofcrudeexports

    fromMexicoisdeclining.Thelong-termcontracts

    supportingtheproposedProjectindicatethatrefiners

    seeeconomicadvantagestoprocessingheavyWCSB

    crudeoilaswellasthedomesticallyproducedBakkenlightcrudeoil,whicharebothgrowingin

    supplyandmaybelessexpensivetotransporttothe

    refinerythanimportedcrudeoilsthatareshippedby

    tanker.Adetailedanalysisofthemarketispresented

    intheSupplementalEISanddiscussedfurtherinthe

    MarketAnalysissectionofthisExecutiveSummary.

    Executive Summary ES-3 March 2013

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    Keystone XL Project Executive SummaryDraft Supplemental EIS

    ES.3 EIS DEVELOPMENT PROCESS

    ES.3.1 Presidential Permitting ProcessForproposedpetroleumpipelinesthatcross

    internationalbordersoftheUnitedStates,the

    President,throughExecutiveOrder13337,directsthe

    SecretaryofStatetodecidewhetheraprojectisinthenationalinterest.IftheproposedProjectis

    determinedtobeinthenationalinterest,itisgranted

    aPresidentialPermitthatauthorizestheconstruction,

    operation,andmaintenanceofthefacilitiesatthe

    borderbetweentheUnitedStatesandCanada.The

    Departmentsjurisdictiondoesnotextendtocover

    selectionofpipelinerouteswithintheUnitedStates.

    ThedraftSupplementalEISwasproducedconsistent

    withNEPAandwillhelpinformthatdetermination.

    TheNationalInterestDetermination(orNID)

    involvesconsiderationofmanyfactors,including

    energysecurity;environmental,cultural,andeconomicimpacts;foreignpolicy;andcompliance

    withrelevantfederalregulations.Beforemakingsuch

    adecision,theDepartmentseekstheviewsofthe

    eightfederalagenciesidentifiedinExecutiveOrder

    13337:theDepartmentsofEnergy,Defense,

    Transportation,HomelandSecurity,Justice,Interior,

    andCommerce,andtheU.S.Environmental

    ProtectionAgency.TheDepartmentisalsosoliciting

    publicinputonthedraftSupplementalEIS.

    ES.3.2 Supplemental EIS ProcessInSeptember2012,Keystonesubmittedan

    EnvironmentalReportinsupportofitsPresidentialPermitapplicationprovidinganupdateoftheimpacts

    oftheproposedProjectanddescribingseveral

    modificationstotheoriginallyproposedpipeline

    routetoreduceenvironmentalimpacts,improve

    constructability,andinresponsetoagencyandpublic

    comments.

    ToassistinpreparingthedraftSupplementalEIS,the

    Departmentretainedanenvironmentalconsulting

    firm,EnvironmentalResourcesManagement,Inc.

    (ERM).ERMwasselectedpursuanttothe

    Departmentsinterimguidanceontheselectionof

    independentthird-partycontractors.ERMworksatthesoleandexclusiveinstructionoftheDepartment

    andisnotpermittedtocommunicatewithKeystone

    unlessspecificallydirectedtodosobyDepartment

    officials.PreparationofthedraftSupplementalEIS

    occurredovera5-monthperiodandincluded

    consultationwithERM,cooperatingagencies,

    scientists,andengineerswithexpertiseinkeyareas

    ofconcernrelatedtotheproposedProject.

    ThisdraftSupplementalEISdescribespotential

    impactsoftheproposedProjectandalternatives,

    includingdirect,indirect,andcumulativeimpacts.Itbuildsontheworkdoneinthe2011FinalEIS,

    includingreferencestothatdocumentthroughoutthe

    textwhereappropriate.TheSupplementalEIS

    includesananalysisofthemodifiedroutein

    Nebraska,aswellasanalysisofanysignificantnew

    circumstancesorinformationthathasbecome

    availablesincetheAugust2011publicationofthe

    FinalEISforthepreviouslyproposedproject.This

    draftSupplementalEISalsorelies,where

    appropriate,onthedatapresentedandtheanalyses

    doneintheFinalEISforthepreviouslyproposed

    project,becausemuchoftheproposedpipelinerouteremainsunchangedfromitsAugust2011publication.

    Finally,thedraftSupplementalEISalsoincludesthe

    latestavailableinformationontheproposedProject

    resultingfromongoingdiscussionswithfederal,

    state,andlocalagencies.

    ES.4 PROJECT DESCRIPTION

    ES.4.1 Keystone XL ProjectTheproposedProjectconsistsofacrudeoilpipeline

    andrelatedfacilitiestotransportWCSBcrudeoil

    fromanoilsupplyhubnearHardisty,Alberta,

    Canada,toexistingpipelinefacilitiesnearSteeleCity,Nebraska,foronwarddeliverytoCushing,

    Oklahoma,andtheGulfCoastarea.Theproposed

    Projectwouldalsotransportdomesticallyproduced

    BakkencrudeoilfromaterminalnearBaker,

    Montana,totheexistingKeystonePipelinesystemat

    SteeleCity,Nebraska.

    TheSteeleCitydeliverypointprovidesaccesstothe

    existingKeystoneCushingExtensionpipeline,which

    deliverscrudeoiltoCushing,Oklahoma,wherethere

    isaccesstootherpipelinesystemsandterminals,

    includingthoseservingtheGulfCoastarea.The

    proposedProjectwouldconsistofapproximately875milesofnew,36-inch-diameterpipelineacross

    portionsofMontana,SouthDakota,andNebraska

    (anadditional329milesofpipelineinCanadawere

    evaluatedbytheCanadiangovernment).FigureES-2

    depictstheproposedProjectintheUnitedStates.

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    Figure ES-2: Proposed Project Overview

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    Figure ES-3: Keystone XL, Typical Pipeline Construction Sequence

    ConstructionoftheproposedProjectwouldgenerally

    requirea110-foot-wide,temporaryROW,anda

    varietyofabovegroundancillaryfacilities.FigureES-3illustratestheconstructionsequencethatwould

    befollowedfortheproposedProject.

    Ifpermitted,wheninoperation,theproposedProject

    wouldmaintaina50-foot,permanenteasementover

    thepipeline.Keystonewouldhaveaccesstoproperty

    withintheeasement,butpropertyownerswould

    retaintheabilitytofarmandconductotheractivities.

    Theremainingabovegroundancillaryfacilitieswould

    include20electricallyoperatedpumpstations(twoof

    whichwouldbebuiltalongexistingsectionsofthe

    KeystoneCushingExtensionpipelineinKansas),

    44mainlinevalves,and38permanentaccessroads.2

    2LocationsforaccessroadsinNebraskahavenotyetbeendeterminedandarenotincludedinthistotal.

    TheoverallproposedProjectisestimatedtocost

    approximately$3.3billionintheUnitedStates.If

    permitted,itwouldbeginoperationin2015,withthe

    actualdatedependentonthenecessarypermits,

    approvals,andauthorizations.

    ES.4.2 Changes Since the Final EIS

    TheproposedpipelinerouteintheUnitedStatesthatisthesubjectofthisdraftSupplementalEISissimilar

    topartofthepreviousprojectevaluatedintheAugust

    2011FinalEIS.Thenewlyproposedroutein

    MontanaandSouthDakotawouldbelargely

    unchanged,exceptforminormodificationsKeystone

    madetoimproveconstructabilityandinresponseto

    comments,suchaslandownerrequeststoadjustthe

    routeacrosstheirproperty.Thenewproposedroute

    is509milesshorterthanthepreviouslyproposed

    route;however,itwouldbeapproximately21miles

    longerinNebraskatoavoidsensitiveareasincluding

    theNDEQ-identifiedSandHillsRegion.Thus,the

    newlyproposedrouteissubstantiallydifferentfromthepreviousrouteanalyzedinAugust2011intwo

    significantways:itavoidstheNDEQ-identifiedSand

    HillsRegionanditterminatesatSteeleCity,

    Nebraska.

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    Figure ES-4: Sand Hills Grassland

    AsshowninFigureES-5,theproposedProjectroute

    inNebraskaissubstantiallydifferentfromthe

    previouslyproposedrouteanalyzedinthe2011Final

    EIS.

    Figure ES-5: Comparison of Proposed Project Route to Previously Proposed Project Segment

    InadditiontotheNDEQ-identifiedSandHills

    Region,theproposedProjectroutewouldavoidareas

    inKeyaPahaCountyidentifiedbytheNDEQthat

    havesoilandtopographiccharacteristicssimilarto

    theSandHillsRegion,anditavoidsormovesfurther

    awayfromwellheadprotectionareasfortheVillages

    ofClarksandWestern.

    ES.4.3 Connected ActionsConnectedactionsareprojectsthatwouldnotbe

    constructedoroperatedintheabsenceofthe

    proposedProject.Thethreeconnectedactions

    associatedwiththeproposedProjectaredescribed

    below.Whiletheseprojectswouldbereviewedand

    actedonbyotheragenciesasneeded,thedraft

    SupplementalEISalsoevaluatestheimpactsofthese

    connectedactions.

    ES.4.3.1 The Bakken Marketlink Project

    KeystoneMarketlink,LLC,awhollyownedsubsidiaryofTransCanadaPipelinesLimited,would

    constructandoperatetheBakkenMarketlinkProject.

    Thisprojectwouldincludea5-milepipeline,pumps,

    meters,andstoragetankstosupplyBakkencrudeoil

    totheproposedpipelinefromtheproposedBakken

    MarketlinkpipelinesysteminNorthDakotaand

    Montana.Threecrudeoilstoragetankswouldbe

    builtnearBaker,Montana,aspartofthisproject.

    Thisproposedprojectcandeliverupto100,000bpd

    ofcrudeoil,andhascommitmentsforapproximately

    65,000bpd.

    ES.4.3.2 Big Bend to Witten 230-kV Electrical

    Transmission LineTheWesternAreaPowerAdministration(Western)

    hasdeterminedthatprovidingreliableelectricityfor

    operationoftheproposedProjectrequiresthe

    constructionofanew230-kilovolt(kV)transmission

    line,originatingattheFortThompson/BigBendDam

    areainSouthDakotaandextendingsouthtothe

    existingWittenSubstation.Tomeetthesedemands,

    Westernwouldrepurposeexistingtransmission

    infrastructureandconstructnewinfrastructure

    betweentheDamandaproposedBigBend

    Substation.TheBasinElectricPowerCooperativewouldconstructanew76-mile,230-kVtransmission

    linefromtheBigBendSubstationtotheexisting

    WittenSubstation,andwouldoperateboththe

    transmissionlineandtheBigBendSubstation.

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    ES.4.3.3 Electrical Distribution Lines and

    SubstationsElectricalpowerfortheproposedProjectwouldbe

    obtainedfromlocalpowerproviders.Thesepower

    providerswouldconstructthenecessarysubstations

    andtransformersandwouldeitheruseexisting

    servicelinesorconstructnewservicelinestodeliverelectricalpowertothespecifiedpointofuse(e.g.,

    pumpstationsandmainlinevalves),whichwouldbe

    locatedatintervalsalongtheproposedProjectroute.

    ES.5 ENVIRONMENTAL ANALYSISConstructionoftheproposedProjectwoulddisturb

    approximately15,493acresofland.After

    construction,approximately5,584acreswouldbe

    retainedforoperationoftheproposedProject;this

    includesthepipelineROWandaboveground

    facilities.Constructionandoperationoftheproposed

    Projectwouldresultinnumerousimpactstothe

    environment.TheDepartmentevaluatedtheimpactsoftheproposedProjectandalternativesassociated

    withthefollowingtypesofresourcesand

    consequences:

    Geology

    Wetlands

    Fisheries

    Recreation

    Culturalresources

    Climatechange

    Waterresources

    Landuse

    Pipelinereleases

    Soils

    Terrestrialvegetation

    Threatenedandendangeredspecies

    Visualresources

    Airquality

    Noise

    Wildlife

    Socioeconomics

    TheproposedProjectConstruction,Mitigation,and

    ReclamationPlan(CMRP)(seeAppendixG)

    includesproceduresthatKeystonewouldfollowto

    reducethelikelihoodandseverityof,oravoid

    impactsfromtheproposedProject.

    Thediscussionbelowsummarizesthefindingsofthe

    analysisrelatedtoselectedresourcesand

    consequences.TheseresourceswouldeitherbesubstantiallyimpactedbytheproposedProject,or

    havebeenthefocusofparticularpublicattentionand

    comment.

    ES.5.1 SoilsConstructionoftheproposedProjectandits

    connectedactionscouldaffectsoilresources.

    Potentialimpactscouldinclude,tovaryingdegrees:

    Soilerosion;

    Lossoftopsoil;

    Soilcompaction;

    Changesinsoilcomposition(increasedproportionoflargerocksinthetopsoil);

    Soilmixing;and

    Soilcontamination.

    NearlyhalfoftheproposedProjectroutewouldcross

    soilscharacterizedashighlyerodibletoeitherwind

    orwater,andcommentsonthe2011FinalEIS

    expressedconcernabouttheproposedProjects

    effectsonerodiblesoils.Manyofthestagesof

    constructionnotablyclearing,trenching,andspoil

    storagecouldpotentiallyincreasesoilerosion.Such

    erosion,inturn,couldresultinlossofvaluable

    topsoilfromitsoriginallocation.Theproposed

    ProjectavoidstheNDEQ-identifiedSandHillsregion,aswellasareasinKeyaPahaCounty,

    Nebraska,definedbyNDEQashavingSandHills-

    likesoils.

    Thesepotentialimpactswouldbemitigatedthrougha

    varietyofmeasures.Keystonesproposed

    constructionmethods(AppendixG,CMRP)

    incorporatemeasurestoreducesoilerosion,

    includingtheuseofsedimentbarriers,trenchplugs,

    temporaryslopebreakers,drainagechannelsor

    ditches,mulching,andinspectionofthesecontrol

    methods.Specificadditionalmethodsandmeasures,

    suchasthefollowingwouldapplyinareasoffragile

    soils(i.e.,wherethesoilexhibitsconditionstypical

    oftheNDEQ-identifiedSandHillsRegionandis

    verysusceptibletowinderosion):

    Useofphotodegradablematting,sedimentlogs,orstrawwattlesratherthanterraces(slopebreakers)insteepslopeorerosion-proneareas;

    Useofnativeseedmixes(developedwithlocalNaturalResourceConservationServiceofficesandusedincoordinationwithlandowners);

    Useoftrench-lineorblade-widthstrippingprocedureswherepracticabletoreducethewidth

    ofdisturbance;and

    Minorrouterealignments.

    Approximately4,715acresofprimefarmlandsoil

    wouldbedirectlyimpactedbyconstructionofthe

    proposedpipeline.Toavoidpermanentimpactsto

    thesesoils,topsoilinnon-forestedagriculturalareas

    wouldberemovedandstockpiledattheedgeofthe

    ROWduringexcavationactivitiesandreturned

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    followingcompletionofconstructionandsubsurface

    soilpreparation.Salvagedepthswouldvaryfrom

    4inchesinshallowsoilsto12inchesinhighly

    productivesoils.OperationoftheproposedProject

    wouldhaveminor,localizedimpactsonsoils.

    ES.5.2 Water ResourcesInresponsetopublicscopingcommentsforthe

    proposedProject,thedraftSupplementalEIS

    includesadetailedassessmentofimpactson

    groundwaterandsurfacewater,includingshallow

    groundwaterassociatedwiththeOgallalaAquifer

    andtheNDEQ-identifiedSandHillsRegion.

    ES.5.2.1 Surface WaterTheproposedProjectwouldimpactwaterbodies

    acrossthestatesofMontana,SouthDakota,and

    Nebraska.TheproposedProjectroutewouldavoid

    surfacewaterwheneverpossible;however,the

    proposedProjectroutewouldstillcrossapproximately1,073waterbodies,including

    56perennialriversandstreams,aswellas

    approximately25milesofmappedfloodplains.

    Construction Phase

    ConstructionoftheproposedProjectcouldresultin

    temporaryandpermanentimpactssuchas:

    Streamsedimentation;

    Changesinstreamchannelmorphology(shape)andstability;

    Temporarilyreducedflowinstreams;and

    Potentialimpactsassociatedwithspills.

    Open-cutmethodswouldbeusedatmostwaterbody

    crossings.However,impactstosurfacewaterbodies

    wouldbemitigatedthroughvariousmeans.

    Horizontaldirectionaldrilling(HDD)wouldbeusedat14majorandsensitivewaterbodycrossings(see

    FigureES-6).Waterbodybankswouldberestoredto

    preconstructioncontoursortoastableslope.

    Seeding,erosioncontrolfabric,andothererosion

    controlmeasureswouldbeinstalled,asspecifiedin

    theCMRP(AppendixG),andpermitdocuments.

    Operations Phase

    Surfacewaterimpactsassociatedwithpotential

    releasesofcrudeoilandotherhazardousliquidspills

    areaddressedlaterinthisExecutiveSummary.Other

    potentialimpactsduringtheoperationsphasewould

    include:

    Channelmigrationorstreambeddegradationthatexposesthepipeline;

    Channelincisionthatincreasesbankheightstothepointwhereslopesaredestabilized,ultimatelywideningthestream;and

    Sedimentationwithinachannelthattriggerslateralbankerosion,suchastheexpansionofachannelmeander(curve)oppositeapointbar.

    Mitigationmeasurestoaddresstheseimpactswould

    includethosespecifiedintheCMRP(AppendixG).

    Crossingswouldbeatleast5feetbelowthebottomofallwaterbodies,andwouldhaveahorizontal

    bufferofatleast15feetfromeitherwaterbodyedge.

    Figure ES-6: Cross Section of Horizontal Directional Drilling Method

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    WhereanHDDmethodisused,thecrossingdepth

    wouldbeupto50feetbelowthestreambed.

    Potentialbankprotectionmeasurescouldinclude

    installingrock,wood,orothermaterialskeyedinto

    thebanktoprovideprotectionfromfurthererosion,

    orregradingthebankstoreducethebankslope.

    ES.5.2.2 GroundwaterTheprimarysourceofgroundwaterimpactsfromthe

    proposedProjectwouldbepotentialreleasesof

    petroleumduringpipelineoperationand,toalesser

    extent,fromfuelspillsfromequipment.Therisks

    andimpactsoftheseeffectsarediscussedlaterinthis

    ExecutiveSummary.Anypetroleumreleasesfrom

    constructionoroperationcouldpotentiallyimpact

    groundwaterwheretheoverlyingsoilsarepermeable

    andthedepthtogroundwaterisshallow.TableES-1

    summarizestheanticipatedeffectsofpotential

    releasesfromtheproposedProjectontheaquifers

    andaquifergroupsalongtheproposedProjectroute.

    FigureES-7providesaschematicviewofthese

    groundwaterresources.

    Hydrostatic TestingWaterhydrostatictestingisperformedtoexpose

    defectivematerialsorweldsthathavemissedprior

    detection,exposepossibleleaks,andserveasafinalvalidationoftheintegrityoftheconstructedsystem.

    Waterispumpedintothesealedpipesection,

    typicallytoapressuregreaterthatthespecifiedpipe

    strength,andthepressurizedsegmentismonitored

    forfailure.

    Followingthetest,thewaterisremovedfromthe

    pipeandreturnedtothenaturalenvironmentor

    disposedofinaregulatedfashion.Waterusedfor

    hydrostatictestingwouldbeobtainedfromnearby

    surfacewaterresources,groundwater,ormunicipal

    sources.Approximately50potentialsurfacewater

    sourceshavebeenidentifiedalongtheproposedProjectroute.Dischargedwaterwouldbetestedfor

    waterqualitypriortoreleasetoensurethatitmeets

    applicablewaterqualitystandards.

    Table ES-1: Effects of Potential Releases on Aquifers

    Aquifer Effects

    AlluvialAquifersandNorthernHighPlainsAquifer(NHPAQ),includingtheOgallalaAquifer

    AquiferconditionsintheNHPAQintheproposedProjectareaindicatethatshallowgroundwatergenerallydischargestolocalsurfacewaterbodies,andtypicallydoesnotflowdownwardinsignificantamountsorflowhorizontallyoverlongdistances.Analysisofhistoricspillsandgroundwatermodelingindicatethatcontaminantplumesfromalarge-scalereleasethatreachesgroundwaterintheNHPAQandalluvialaquiferscouldbeexpectedtoaffectgroundwaterqualityuptoapproximately1,000feetdowngradientofthereleasesource.ThislocalizedeffectindicatesthatpetroleumreleasesfromtheproposedProjectwouldnotextensivelyaffectwaterqualityinthisaquifergroup.

    GreatPlainsAquifer(GPA)

    AcrossmostoftheproposedpipelineareawheretheGPAispresent,itisveryunlikelythatanyreleasesfromtheproposedpipelinewouldaffectgroundwaterqualityintheaquifer,becausetheaquiferistypicallydeeplyburiedbeneathyounger,water-bearingsedimentsand/oraquitardunits.TheexceptionisinsouthernNebraska,wheretheaquiferisclosertothesurface.WaterqualityintheGPAcouldbeaffectedbyreleasesinthisarea,butgroundwaterflowpatternsinthevicinityoftheproposedProjectroutemakesucheffectsunlikely.Overall,itisveryunlikelythattheproposedpipelineareawouldaffectwaterqualityintheGPAduetoweakdownwardgradients(downwardgroundwaterflows)intheaquifersoverlyingtheGPA.

    WesternInteriorPlainsAquifer

    ThedepthtothisaquiferisseveralhundredfeetintheproposedProjectarea;therefore,thereisanextremelylowprobabilitythatapetroleumreleasefromtheproposedProjectwouldaffectwaterqualityinthisaquifer.

    NorthernGreatPlainsAquiferSystem(NGPAS)

    AswiththeGPA,petroleumreleasesfromtheproposedProjectwouldonlyaffectwaterqualityinportionsoftheNGPASnearthegroundsurface.Inthecaseofalarge-scalerelease,theseimpactswouldtypicallybelimitedtowithinseveralhundredfeetofthereleasesource,andwouldnotaffectgroundwaterwithinareasthatprovidegroundwaterrechargetolargeportionsoftheNGPAS.

    ShallowGroundwaterandWaterWells

    hereare2,537wellswithin1mileoftheproposedProject,including39publicwatersupplyellsand20privatewellswithin100feetofthepipelineROW.ThevastmajorityofthesewellseinNebraska.Thosewellsthatwereinthevicinitymaybeaffectedbyapetroleumrelease

    fromtheproposedProject.

    Twar

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    Figure ES-7: Schematic Hydrogeologic Cross-Section along Proposed Pipeline Route

    ES.5.2.3 FloodplainsTheproposedpipelinewouldcrossmappedand

    unmappedfloodplainsinMontana,SouthDakota,andNebraska.Infloodplainareasadjacentto

    waterbodycrossings,contourswouldberestoredto

    asclosetopreviouslyexistingcontoursaspractical

    andthedisturbedareawouldberevegetatedduring

    constructionoftheROWinaccordancewiththe

    CMRP(AppendixG).Afterconstruction,the

    proposedpipelinewouldnotobstructflowsover

    designatedfloodplains,andanychangesto

    topographywouldbeminimalandthuswouldnot

    affectlocalflooddynamicsorfloodelevations.

    ES.5.3 Threatened and Endangered Species

    ConsultationwiththeU.S.FishandWildlifeService(USFWS)identified13federallyprotectedor

    candidatespeciesthatcouldbeimpactedbythe

    proposedProject:elevenfederally-listedthreatened

    orendangeredspecies,asdefinedunderthe

    EndangeredSpeciesAct(ESA),andtwocandidate

    speciesforlistingasthreatenedorendangered.In

    addition,thisdraftSupplementalEISalsoevaluated

    thepotentialProjectimpactsononespeciesunder

    considerationforfederalprotectionunderESA.In

    consultationwiththeUSFWS,theDepartment

    preparedaBiologicalAssessment(BA)toevaluate

    theproposedProjectspotentialimpactstofederallyprotectedandcandidatespeciesandtheirfederally

    designatedcriticalhabitat(AppendixH).Inaddition,

    13state-listedspeciesthatarenotalsofederallylisted

    speciesandonespeciesunderconsiderationfor

    federalprotectionundertheESAcouldbeimpacted

    bytheproposedProject.

    Typesofpotentialimpactstothreatenedand

    endangeredspeciesinclude:

    Habitatloss,alteration,andfragmentation;

    Directmortalityduringconstructionandoperation,includingcollisionwithpowerlines;

    Indirectmortalityduetostressoravoidanceoffeeding,and/orreducedbreedingsuccessduetoexposuretonoiseand/orincreasedhumanactivity;and

    Reducedsurvivalorreproductionduetodecreasedabundanceoffoodorreducedcover.

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    Thesubsectionsbelowprovideadditionaldetailon

    speciesthatcouldpotentiallybeaffectedbythe

    proposedProject,orspeciesthatarefrequenttopics

    ofconcernforprojectssimilartoorinthesame

    geographicregionastheProject.Monitoringand

    mitigationmeasuresthataddresstheseimpactsare

    discussedthoroughlyinthedraftSupplementalEIS.

    ES.5.3.1 American Burying BeetleOfthe13federallyprotectedorcandidatespecies,the

    Americanburyingbeetle(Nicrophorus americanus)

    wastheonlyspeciesdeterminedtobepotentially

    adverselyaffectedbytheproposedProject.

    Figure ES-8: American Burying Beetle

    Approximately50milesoftheproposedProject

    RouteinNebraskawouldaffectAmericanburying

    beetlehabitat;approximately43milesinSouth

    Dakotawouldaffectsuitablehabitatforthespecies.

    ConsultationbetweentheDepartmentandUSFWSresultedindevelopmentofconservationmeasures

    andcompensatorymitigation,suchastrappingand

    relocatingbeetles,speciallightingrestrictions(the

    beetlesareattractedtolight),andestablishmentofa

    habitatconservationtrust.

    Evenwiththesemeasures,theproposedProjectcould

    affect,andwouldbelikelytoadverselyaffectthe

    Americanburyingbeetle,resultinginincidentaltakes

    (unintendeddeathofindividualbeetles)during

    constructionoroperations.Keystonecontinuesto

    workwithUSFWStorefineconservationmeasures

    forminimizingincidentaltakeandtoquantifyestimatedincidentaltakeanddevelopmentof

    compensatorymitigationthroughtheformal

    Section7ESAconsultationprocessfortheAmerican

    buryingbeetle.

    ES.5.3.2 Whooping CraneThewhoopingcrane(Grus Americana)isfederally

    protectedandisalsoprotectedundertheMigratory

    BirdTreatyAct.Whoopingcranescouldbeimpacted

    bycollisionswithpowerlinesassociatedwiththe

    proposedProject.Themajorityoftheproposed

    Projectroutecrossesthecentralflywaywhooping

    cranemigrationcorridorinSouthDakotaand

    Nebraska,andtheRainwaterBasininsouthcentral

    Nebraskaprovideswhoopingcranemigrationhabitat.

    Withavoidance,minimization,andconservation

    measures,suchasfollowingtheWhoopingCrane

    SurveyProtocolpreviouslydevelopedbythe

    USFWSandNebraskaGameandParksCommission,

    theproposedProjectisunlikelytoadverselyaffect

    whoopingcranes,basedonthelowlikelihoodofthe

    speciesoccurringneartheproposedProjectroute

    duringconstructionandoperationsactivitiesand

    implementationofUSFWSrecommendedmitigationmeasures.

    ES.5.3.3 Greater Sage-GrouseThegreatersage-grouse(Centrocerus urophasianus)

    isafederalcandidatespeciesundertheESA,a

    BureauofLandManagementsensitivespecies,anda

    speciesofconservationconcerninMontanaand

    SouthDakota.Approximately190milesofthe

    proposedProjectroutewouldcrossareaswithgreater

    sage-grousehabitatinMontana,ofwhich94miles

    areclassifiedasmoderatetohigh-qualityhabitatfor

    greatersage-grouse.

    Figure ES-9: Greater Sage-Grouse

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    Themostsubstantialpotentialeffectsoftheproposed

    Projectonthegreatersagegrousewouldbe

    disturbanceofhabitat,includingsagebrush,which

    cantakeupto20yearstoregenerateto

    pre-constructioncoverlevels,anddisturbanceof

    matingandbreedingbehavior.

    TheBA(AppendixH)andgreatersage-grousemitigationplansforMontanaandSouthDakota

    describeconservationmeasuresthatKeystonewould

    implementtoaddresspotentialimpacts.After

    implementationofthesemeasures,theproposed

    Projectwouldnotlikelyaffectgreatersage-grouse

    matingbehavior,andwouldlikelyresultinalow

    impactonnestinggreatersage-grouse.Construction

    wouldlikelyresultinanincrementallossof

    sagebrushhabitat.

    ES.5.3.4 Western Prairie Fringed Orchid

    Thewesternprairiefringedorchid(Platantheraleucophaea)isfederallylistedasthreatened,state-

    listedasthreatenedinNebraska,andisaspeciesof

    conservationconcerninSouthDakota.Theproposed

    Projectwouldpassnearknownpopulationsof

    westernprairiefringedorchidinNebraska,and

    throughlandwheretheorchidmaypotentiallyoccur

    inSouthDakota.Clearingandgradingofland

    associatedwithconstructionoftheproposedProject

    (includingpipelineandancillaryfacilities)may

    potentiallydisturbwesternprairiefringedorchids,

    andmayintroduceorexpandinvasivespeciesthat

    alreadycontributetotheorchidsdecline.

    Figure ES-10: Western Prairie Fringed Orchid

    Keystonewouldimplementconservationmeasures

    includedintheBA(AppendixH)andwouldavoid

    knownwesternprairiefringedorchidpopulations;

    therefore,theproposedProjectwouldnotbelikelyto

    adverselyaffectthewesternprairiefringedorchid.

    ES.5.3.5 Small White Ladys SlipperThesmallwhiteladysslipper(Cypripedium

    candidum),atypeofperennialorchid,isathreatened

    speciesunderNebraskastatelaw.Thisspeciesmay

    potentiallyoccurwithinsuitablehabitatalongthe

    proposedProjectrouteinNebraska.Ifthisplantwere

    tobeobservedwithintheproposedProjectroutein

    Nebraska,appropriatemitigationmeasureswouldbe

    developedandimplementedinconsultationwithstate

    agencies.

    ES.5.4 Socioeconomics and Environmental

    Justice

    ThedraftSupplementalEISupdatestheeconomicdatacontainedintheFinalEISandre-evaluatesthe

    economicimpactsoftheproposedProject.In

    particular,andinresponsetopubliccomments,the

    draftSupplementalEISaddresseslocaleconomic

    impactsandEnvironmentalJustice.

    ES.5.4.1 Tribal ConsultationGovernment-to-governmentconsultationisunderway

    forthecurrentSupplementalEISprocessforthe

    proposedProject,andtribalmeetingswereheldin

    October2012inMontana,SouthDakota,and

    Nebraska.Astheleadfederalagencyforthe

    proposedProject,theDepartmentiscontinuing

    throughouttheSupplementalEISprocesstoengage

    inconsultationontheSupplementalEIS,the

    proposedProjectgenerally,andonculturalresources

    consistentwithSection106oftheNationalHistoric

    PreservationActof1986withidentifiedconsulting

    parties,includingfederalagencies,stateagencies,

    StateHistoricPreservationOffices,theAdvisory

    CouncilonHistoricPreservation,andinterested

    federallyrecognizedNativeAmericantribesinthe

    vicinityoftheproposedProject.

    ES.5.4.2 SocioeconomicsConstruction

    ConstructionoftheproposedProjectwouldgenerate

    temporary,positivesocioeconomicimpactsasa

    resultoflocalemployment,taxes,spendingby

    constructionworkers,andspendingonconstruction

    goodsandservices.Includingdirect,indirect,and

    inducedeffects,theproposedProjectwould

    potentiallysupportapproximately42,100average

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    annualjobsacrosstheUnitedStatesovera1- to2-

    yearconstructionperiod(ofwhich,approximately

    3,900wouldbedirectlyemployedinconstruction

    activities).Thisemploymentwouldpotentially

    translatetoapproximately$2.05billioninearnings.

    Directexpendituressuchasconstructionand

    materialscosts(includingconstructioncamps)wouldtotalapproximately$3.3billion.Short-termrevenues

    fromsourcessuchassalesandusetaxeswouldtotal

    approximately$65millioninstatesthatlevysucha

    tax.Yieldsfromfuelandothertaxescouldnotbe

    calculated,butwouldprovidesomeadditional

    economicbenefittohostcountiesandstates.

    TheproposedProjectareadoesnothavesufficient

    temporaryhousingfortheanticipatedconstruction

    workforce.Keystoneproposestomeetthehousing

    needthroughacombinationoflocalhousingand

    eightconstructioncamps.Propertytaxesonthese

    campswouldpotentiallygeneratetheequivalentofonefullyearofpropertytaxrevenueforsevenhost

    counties,totalingapproximately$2million.

    Otherconstruction-phasesocioeconomicimpacts

    wouldincludeminorincreasesindemandforutilities

    andpublicservices(suchaspolice,fire,and

    emergencymedicalservices),andtemporarytraffic

    delaysatpublicroadcrossings.Theconstruction

    campswouldprovideutilitiesandotherservicesfor

    workers,reducingdemandsonexistingcommunities.

    Operations Phase

    Generally,thelargesteconomicimpactsofpipelines

    occurduringconstructionratherthanoperations.

    Onceinplace,thelaborrequirementsforpipeline

    operationsarerelativelyminor.Operationofthe

    proposedProjectwouldgenerate35permanentand

    15temporaryjobs,primarilyforroutineinspections,

    maintenance,andrepairs.Basedonthisestimate,

    routineoperationoftheproposedPipelinewould

    havenegligiblesocioeconomicimpacts.

    ES.5.4.3 Environmental JusticeAsdefinedbytheU.S.EnvironmentalProtection

    Agency,EnvironmentalJusticereferstothefair

    treatmentandmeaningfulinvolvementofallpeopleregardlessofrace,color,nationalorigin,orincome

    withrespecttothedevelopment,implementation,and

    enforcementofenvironmentallaws,regulations,and

    policies.ExecutiveOrder12898furtherdirects

    federalagenciestoidentifyandaddress,as

    appropriate,disproportionatelyhighandadverse

    healthorenvironmentaleffectsoftheirprograms,

    policies,andactivitiesonminoritypopulationsand

    low-incomepopulations,specificallyaspartofa

    NEPAprocess.Withinthesocioeconomicanalysis

    area,16blockgroupscontainminoritypopulations

    thatweremeaningfullygreaterthanthesurrounding

    stateorcounty(referenceareas),andfivecensus

    tractshadlargerlow-incomepopulationsthantheir

    respectivereferenceareas.Fouroftheseareascontainedbothtypesofmeaningfullygreater

    populations.

    Impactstominorityandlow-incomepopulations

    duringconstructionmayincludeexposureto

    constructiondustandnoise,disruptiontotraffic

    patterns,andincreasedcompetitionformedicalor

    healthservicesinunderservedpopulations.Such

    impactswouldgenerallybesmallandshort-term.

    TypicaloperationoftheproposedProjectisunlikely

    todisproportionatelyadverselyimpactthe

    EnvironmentalJusticepopulationsdiscussedinthis

    section.Becausetheriskofapotentialreleaseisroughlyequalatallpointsalongthepipeline,the

    risksassociatedwithsuchreleaseswouldnotbe

    disproportionatelybornebyminorityorlow-income

    populations.

    ES.5.5 Greenhouse Gas Emissions andClimate Change

    ThedraftSupplementalEISevaluatestheGHG

    emissionsassociatedwiththeproposedProjectfrom

    severaldistinctperspectives.Theconstructionand

    operationoftheproposedProjectanditsconnected

    actions(thepipeline,pumpstations,electrical

    transmissionlines,etc.)wouldgenerateGHG

    emissions.Inaddition,concernshavebeenraisedthat

    extractingthecrudeoilthatwouldbetransportedby

    theproposedProjectproducesmoreGHGemissions

    comparedtoothertypesofcrudeoil.Finally,climate

    changeconsiderationswhichareinfluencedby

    GHGemissionscouldaffecttheconstructionand

    operationoftheproposedProject.GHGandclimate

    changeissueswerethesubjectofmanycomments

    receivedduringthepublicscopingprocessforthe

    proposedProject.

    ES.5.5.1 Greenhouse Gas EmissionsConstructionandoperationoftheproposedProjectwouldgenerateGHGemissionsfromseveralsources

    oractivities,asdescribedbelow.

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    Construction-Phase Sources

    ClearingoflandintheproposedROWviaopenburning;

    Electricityusageandemergencygeneratorsatconstructioncamps;and

    Constructionvehicles,workertransports,andothermobilesources.

    Operations-Phase Sources

    Fugitivemethaneemissionsatconnections;

    Maintenancevehicles(twoormoretimesperyear);

    Aircraftusedforaerialinspection(biweekly);and

    Electricalgenerationforpumpstationpower.

    Duringtheconstructionperiod,GHGemissionsfrom

    thesesourcesandactivitieswouldbeapproximately240,423metrictonsofcarbondioxideequivalents

    (CO2e).Emissionsduringoperationoftheproposed

    Projectwouldbeapproximately3.19millionmetric

    tonsofCO2eperyear,almostentirelydueto

    electricalgenerationneededtopowertheproposed

    Projectspumpstations.

    TheannualCO2eemissionsfromtheproposed

    ProjectisequivalenttoCO2eemissionsfrom

    approximately626,000passengervehiclesoperating

    foroneyearor398,000homesusingelectricityfor

    oneyear.

    ES.5.5.2 Life Cycle AnalysisCombustionoffossilfuels,includingpetroleum-

    basedproductssuchascrudeoil,isamajorsourceof

    globalGHGemissions,whichcontributetohuman-

    inducedclimatechange.WCSBcrudesaremore

    GHG-intensivethantheotherheavycrudesthey

    wouldreplaceordisplaceinU.S.refineries,andemit

    anestimated17percentmoreGHGsonalife-cycle

    basisthantheaveragebarrelofcrudeoilrefinedin

    theUnitedStatesin2005.IftheproposedProject

    weretoinducegrowthintherateofextractioninthe

    oilsands,thenitcouldcauseGHGemissionsgreater

    thanjustitsdirectemissions.

    BasedoninformationandanalysisabouttheNorth

    Americancrudetransportinfrastructure(particularly

    theprovenabilityofrailtotransportsubstantial

    quantitiesofcrudeoilprofitablyundercurrentmarket

    conditions,andtoaddcapacityrelativelyrapidly)and

    theglobalcrudeoilmarket,thedraftSupplemental

    EISconcludesthatapprovalordenialoftheproposed

    Projectisunlikelytohaveasubstantialimpactonthe

    rateofdevelopmentintheoilsands,orontheamount

    ofheavycrudeoilrefinedintheGulfCoastarea.

    Asdiscussedinthemarketanalysis,iftheproposedProject were denied but other proposed new andexpanded pipelines go forward, production could

    decreasebyapproximately0.4to0.6percentoftotalWCSB productionby2030. Ifall pipelinecapacitywere restricted, oil sands production could decreasebyapproximately2to4percentby2030.

    Theincrementalindirectlife-cycleemissions

    associatedwiththosedecreasesinoilsands

    productionareestimatedtobeintherangeof0.07to

    0.83millionmetrictonsCO2equivalent(MMTCO2e)

    annuallyiftheproposedProjectwerenotbuilt,andin

    therangeof0.35to5.3MMTCO2eannuallyifall

    pipelineprojectsweredenied.

    AsWCSBandBakkencrudesreplacecrudesfrom

    othersourcesindependentofwhethertheproposedProjectexiststhelife-cycleGHGemissions

    associatedwithtransportationfuelsproducedinU.S.

    refinerieswouldlikelyincrease.TheGHGintensity

    ofreferencecrudesmayalsoincreaseinthefutureas

    moreoftheworldcrudesupplyrequiresextractionby

    increasinglyenergy-intensivetechniques,suchas

    thoseusedtoextractoil-sandscrude,although

    regulatorypressuresandtechnologicaladvances

    couldcounterthistrend.

    ES.5.5.3 Climate Change Effects on the

    ProjectChangesinclimatehavebeenobservedbothgloballyandwithintheproposedProjectstudyareaoverthe

    pastcentury.Thesechangesincludedirecteffects,

    suchasincreasesanddecreasesintemperatureand

    precipitation,andindirecteffects,suchasincreasesin

    freeze-thawcycles,increasedoccurrencesofflooding

    anddrought,andwinderosionofsoil,andresultant

    changestothenaturalenvironment,suchas

    vegetationchanges.

    AspartofthepreparationofthisdraftSupplemental

    EIS,ananalysiswasperformedtoevaluatethe

    potentialimpactsofclimatechangeontheproposed

    Projectconstructionandoperations.Usingfuture

    climatescenariosdevelopedbythe

    IntergovernmentalPanelonClimateChangeand

    peer-revieweddownscaledmodels,thedraft

    SupplementalEISevaluatestherangeofimpactsthat

    climatechangecouldhaveontheproposedProject.

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    AssumingconstructionoftheproposedProject

    beginsasplannedin2015,climateconditionsduring

    the1- to2-yearconstructionperiodwouldnotdiffer

    substantiallyfromcurrentconditions.Duringthe

    operationsperiod,climatechangeprojectionssuggest

    thefollowingchanges:

    Warmerwintertemperatures;

    Ashortercoolseason;

    Alongerdurationoffrost-freeperiods;

    Morefreeze-thawcyclesperyear(whichcouldleadtoanincreasednumberofepisodesofsoilcontractionandexpansion);

    Warmersummertemperatures;

    Increasednumberofhotdaysandconsecutivehotdays;and

    Longersummers(whichcouldleadtoimpactsassociatedwithheatstressandwildfirerisks).

    Thepipelinewouldbeburieddeepenoughtoavoid

    surfaceimpactsofclimatechanges(freeze-thaw

    cycles,fires,andtemperatureextremes).

    ES.5.6 Potential ReleasesThetermsrelease,leak,andspillareused

    throughoutthissection.Thesearedistinctterms.A

    releaseisalossofintegrityofapipeline(including

    themainlineandothercomponents);aleakisa

    releaseovertime;andaspillistheliquidvolumeofa

    leakthatescapesanycontainmentsystemandenters

    theenvironment.Thissectiondescribestherelease

    andspillanalysesincludedinthedraftSupplemental

    EIS,includingpotentialimpactsonwaterbodiesand

    mitigationmeasures,asidentifiedinpublicscoping

    comments.

    ES.5.6.1 Spill ScenariosThePotentialReleasessectionofthedraft

    SupplementalEISaddressestherisksandpotential

    impactsofcrudeoilreleasesandspillsduring

    constructionandoperationoftheproposedProject.

    Thisriskassessmentaddressesboththepotential

    frequencyofoperationalpipelinereleasesandthe

    potentialcrudeoilspillvolumesassociatedwiththe

    releases,usingthreehypotheticalspillvolumesto

    representtherangeofreportedspillsinthePipeline

    andHazardousMaterialsSafetyAdministration

    (PHMSA)database.Thesespillvolumesandthe

    probabilitiesofsuchvolumesareshowninTableES-2.Screening-level(i.e.,general)modelswere

    usedtoestimatethedistanceoilcouldmoveover

    landormigrateingroundwater.

    TableES-3summarizeshazardousliquidpipeline

    incidentsreportedtoPHMSAfromJanuary2002

    throughJuly2012andshowsthebreakdownof

    incidentsbypipelinecomponent.FigureES-11

    summarizesthespillscenariosreportedtoPHMSA,

    bypipelineelements.

    Table ES-2: Spill Scenarios Evaluated in Draft Supplemental EIS

    Spill Volume Scenario Frequencya

    Small:Lessthan50barrels(bbl)(2,100gallons) 79%

    Medium:501,000bbl(2,10042,000gallons) 17%

    Large:1,00020,000bbl(42,000840,000gallons) 4%aIndicatestheshareofallreleasesreportedinthePHMSAdatabasethatfiteachspillvolumescenario.

    Table ES-3: Summary of PHMSA Database Incidents (January 2002 to July 2012)

    Incident Category Incidents Incident Sub-Category Incidents

    Crudeoilpipeline 1,692

    Crudeoilmainlinepipeincidents 321

    Crudeoilpipeline,equipmentincidents(notmainlinepipe) 1,027

    Crudeoilpipelinesystem,unspecifiedelements 344

    Crudeoilmainlinepipe

    321

    16-inchorgreaterdiameter 71

    8-inchor15-inchdiameter 154

    Lessthan8-inchdiameter 52

    Diameternotprovided 44

    Crudeoilpipeline,equipment(notmainlinepipe)

    1,027

    Tanks 93

    Valves 25

    Otherdiscreteelements(pumps,fittings,etc.) 909

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    79%

    56%

    38%

    51%

    89%

    81%

    17%

    35%

    36%

    30%

    11%

    16%

    4%

    9%

    26%

    17%

    3%

    0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

    Pipeline, All Elements

    Mainline Pipe

    Mainline Pipe, Diameter 16"+

    Pipeline System, Tanks

    Pipeline System, Mainline Valves

    Pipeline System, Other Discrete Elements

    0 50 bbl 50 1,000 bbl 1,000 20,000 bbl

    Spill Scenarios

    Source:PHMSAHazardousLiquidPipelineIncidentData20022012,andPHMSALiquidAnnualPipelineData.20042011

    Figure ES-11: Spill Volume Distribution by Pipeline Component

    ES.5.6.2 Oil Movement

    Small and Medium Spills

    Thepotentialimpactsfromsmallleaksofoilwould

    typicallybeconfinedtosoilimmediatelysurrounding

    theleak,andwouldhavelittleeffectonnearby

    naturalresources.Thesetypesofspillswouldgenerallybedetectedbymaintenanceoroperations

    personnelandaddressedthroughrepairoftheleak

    andremovalandremediationofimpactedsoil.A

    slowsubsurfaceleak,characterizedasaslowdrip

    (e.g.,gallonsperyearasopposedtogallonsper

    minute),wouldinfiltrateintosoilandcould

    potentiallyreachagroundwaterresource.Ifthespill

    rateisfasterthanthesoilcanabsorb,theoilmay

    surfaceandpotentiallyflowawayfromtherelease

    site,affectingnearbyvegetationorotherresources.

    Withmediumspills,areleasecanoccurasa

    subsurfaceorsurfaceeventdependinguponthecause.Similartoasmallspill,aslowsubsurface

    releasecouldpotentiallyreachagroundwater

    resource,andiftherateofthespillisfasterthanthe

    soilcanabsorb,theoilmaysurface.Oncethe

    migratingoilleavesthereleasesite,impactstosoil,

    vegetation,andsurfacewateralongtheflowpath

    mightoccur.Dependingonhowquicklyitis

    remediated,someofthisvolumeofmaterialmight

    tendtopoolinlowareasandpotentiallyinfiltrate

    backintothesoilandtogroundwaterdependingon

    thedepthtogroundwater.Potentialbehaviorin

    shallowgroundwateristhesameassmallspillsthat

    reachgroundwater;thespillcouldmigrateawayfrom

    thereleasesite.Becauseoftheincreasedvolumeof

    oilreleasedfromthepipelinewhencomparedtoa

    smallrelease,itisalsopossiblethatoilcouldpoolon

    groundwater.

    Large Spills

    Withalargespill,themajorityofthespillvolume

    wouldmigrateawayfromthereleasesite.The

    potentialimpactsfromalargespillwouldbesimilar

    totheimpactsfromthemedium-sizedspill,butona

    muchlargerscale.Oncethespillreachesthesurface,

    theoilwouldflowfollowingtopographicgradientor

    lows(e.g.,gullies,roadsidedrainageditches,

    culverts,andstormsewers)andeventuallytosurface

    waterfeatures.Ifthereleaseentersflowingwaterorothersurfacewaterfeature,theextentoftherelease

    couldbecomeverylarge,potentiallyaffectingsoil

    andvegetationalongmilesofriverandshoreline.

    Sinkingoilcanbedepositedinriverorstream

    bottomsandbecomeacontinualsourceofoilas

    changingwaterflowsreleasethedepositedoil.

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    ES.5.6.3 MitigationKeystonehasagreedtoincorporate57Special

    ConditionsdevelopedbyPHMSAintotheproposed

    Projectandinitsmanualforoperations,maintenance,

    andemergencies.ThemajorityoftheSpecial

    Conditionsrelatetoreductioninthelikelihoodofa

    releaseoccurring.Someprovidemitigationthatreducestheconsequencesandimpactofaspill,

    shouldsuchaneventoccur.Examplesofthetypesof

    SpecialConditionsthatPHMSAdevelopedtoreduce

    theriskofareleaseinclude,amongothers,measures

    thatwouldbetterpreventcorrosion,stresscracking,

    equipmentmalfunctions,third-partydamage,and

    operatorerror.

    ES.5.7 Cumulative EffectsThecumulativeeffectsanalysisevaluatestheway

    thattheproposedProjectsimpactsinteractwiththe

    impactofotherpast,present,andreasonably

    foreseeablefutureactionsorprojects.Thegoalofthecumulativeimpactsanalysisistoidentifysituations

    wheresetsofcomparativelysmallindividualimpacts,

    takentogether,constitutealargercollectiveimpact.

    FortheproposedProject,thedraftSupplementalEIS

    identifiesactionsorprojectswiththepotentialfor

    cumulativeimpacts.Thecumulativeeffectsanalysis

    providesdetailedevaluationoftheeffectsofthese

    projectswhencombinedwiththeproposedProject,

    includingimpactsonresourceswithintheUnited

    States,lifecycleGHGemissionsofWCSBactivities,

    andimpactsonresourcesinCanada.

    ES.5.8 Environmental Impacts in CanadaInadditiontotheenvironmentalanalysisofthe

    proposedProjectintheUnitedStates,theDepartment

    monitoredandobtainedinformationfromthe

    environmentalanalysisoftheCanadianportionofthe

    Project.TheCanadiangovernmentconductedan

    environmentalreviewoftheportionoftheproposed

    ProjectinCanada.TheDepartmentdidnotconduct

    anassessmentofthepotentialimpactsofthe

    CanadianportionoftheproposedProject.However,

    theDepartmenthasincludedinformationfromthe

    Canadiangovernmentsassessmentinthisdraft

    SupplementalEIS.

    TheCanadianenvironmentalanalysisprocessbegan

    inJuly2008andinvolvedanenvironmental

    assessmentprocesspursuanttotheCanadian

    EnvironmentalAssessmentAct.OnMarch11,2010,

    theCanadianNationalEnergyBoard(NEB)issued

    itsReasonsforDecisiongrantingKeystones

    application.TheNEBsReasonsforDecision

    includedanEnvironmentalScreeningReportthat

    waspreparedtomeettherequirementsofCanadian

    EnvironmentalAssessmentActfortheCanadian

    portionoftheproposedProject.

    TheEnvironmentalScreeningReportconcludedthat,

    withincorporationofKeystonesproposedmeasures

    toavoidorminimizeimpactsandwithKeystonesacceptanceoftheNEBsregulatoryrequirementsand

    recommendedconditions,implementationofthe

    proposedProjectinCanadawouldnotlikelyresultin

    significantadverseenvironmentaleffects.Forthe

    Canadianportionofthepipeline,constructionbegan

    ontheHardistyBTerminalinSeptember2010,and

    HDDcrossingsoftheRedDeerandSouth

    Saskatchewanriverswerecompletedinearly2012.

    Analysisandmitigationofenvironmentalimpactsin

    CanadaareongoingbyCanadianofficials.For

    example,onSeptember1,2012,theGovernmentof

    AlbertasdevelopmentplanfortheLowerAthabascanoilsandsregionbecameeffective.The

    planwouldrequirecancellationofabouttenoilsands

    leases,setasidenearly20,000squarekilometers

    (7,700squaremiles)forconservation,andsetnew

    environmentalstandardsfortheregioninaneffortto

    protectsensitivehabitat,wildlife,andforestland.

    ES.6 ALTERNATIVESThedraftSupplementalEISconsidersthreebroad

    categoriesofalternativestotheproposedProject,

    consistentwithNEPArequirements:

    NoActionAlternativewhichaddressespotentialmarketresponsesthatcouldresultifthePresidentialPermitisdeniedortheproposedProjectisnototherwiseimplemented;

    MajorRouteAlternativeswhichincludesotherpotentialpipelineroutesfortransportingWCSBandBakkencrudeoiltoSteeleCity,Nebraska;and

    OtherAlternativeswhichincludeminorroutevariations,alternativepipelinedesigns,andalternativesitesforabovegroundfacilities.

    ES.6.1 Scenario ScreeningSeveralalternativesexistforthetransportofWCSB

    andBakkencrudeoiltoGulfCoastrefineries,

    includingmanythatwerenotcarriedforwardfor

    detailedanalysis.ThedraftSupplementalEIS

    providesamoredetaileddescriptionofthecategories

    ofalternatives,thealternativescreeningprocess,and

    thedetailedalternativesidentifiedforevaluationin

    thedraftSupplementalEIS.

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    PotentialNoActionAlternativescenarioswere

    screenedbasedontechnicalandeconomicfeasibility,

    suchasimplementationtimeframeandcrudeoil

    transportcapacity,aswellasthepotentialtoprovide

    acostadvantage(comparedtootherNoAction

    Alternativescenarios).Asexplainedindetailinthe

    draftSupplementalEIS,NoActionAlternativescenariosexcludedfromfurtheranalysisare:

    RailorPipelinetoVancouver,BritishColumbia,andTankertoGulfCoast;

    RailDirectlytoGulfCoast;

    RailtoWoodRiver,Illinois;BargetoGulfCoastviaMississippiRiver;

    BitumenbyRail;and

    CanadianPipelineScenario(ExistingPipelines).

    Theprimarypurposeofmajorroutealternativesisto

    identifyaroutethatavoidstheNDEQ-identifiedSandHillsRegionwithoutanunacceptableincrease

    inotherenvironmentalimpacts.Althoughthe

    KeystoneXL2011SteeleCitySegmentAlternative

    traversestheNDEQ-identifiedSandHillsRegion,the

    draftSupplementalEISevaluatestheimpactsof

    constructingthatrouteasacomparisonagainstwhich

    otherroutealternatives,includingtheproposed

    Project,canbemade.Theinitial(PhaseI)screening

    ofothermajorroutealternativesconsideredthe

    followingcriteria:

    ProjectPurposetobeconsideredreasonable,

    analternativemustprovidereliabletransportofupto730,000bpdofWCSBcrudeoilandupto100,000bpdofBakkencrudeoiltoCushing,Oklahoma(theintermediatedestinationofcrudeoilintheproposedProject)orGulfCoastrefineries(theultimatedestinationofthatcrudeoil);and

    PipelineLengthpipelinelengthwasconsideredarelativemeasureofreliability,environmentalimpact,andconstruction/operationalcosts.

    ThePhaseIIscreeningusedadesktopdatareviewof

    keyenvironmentalandotherfeatures(e.g.,wetlands

    andwaterbodiescrossed,totalacreageaffected).

    Majorroutealternativesexcludedfromfurtheranalysisare:

    WesternAlternative(toCushing);

    Express-PlatteAlternative;

    SteeleCitySegment-A1AAlternative;

    KeystoneCorridorOption1;and

    KeystoneCorridorOption2.

    ES.6.2 Market AnalysisThissectionintheSupplementalEISexaminesthe

    changesinpetroleummarketssincethepublicationof

    theFinalEISonAugust26,2011.Itassesseswhether

    thesechangesaltertheconclusionofthe2011Final

    EISmarketanalysis,namely,thattheproposed

    Projectisunlikelytosignificantlyaffecttherateof

    extractionintheoilsandsorinU.S.refining

    activities.Specifically,thesectionpresentschanges

    observedinthepetroleummarketsinceAugust2011

    andhowsuchchangesmayimpacttheassessment

    madeintheFinalEIS.Theanalysisisbased,inpart,

    onthefollowingconsiderations.

    Severalchangesintheoutlookforthecrudeoil

    marketsinceAugust2011haveoccurredandare

    accountedforintheSupplementalEISanalysis.First,theoutlookforU.S.demandfortransportationfuelis

    nowlowerthanitwasin2010and2011.Second,

    domesticproductionofcrudeoilhasincreasedandis

    expectedtocontinueincreasingoverthenext10to

    15years.Third,theinfrastructureforcrudeoil

    transportationinNorthAmerica,includingpipeline,

    rail,andothernon-pipelinemodes,isundergoing

    significantadaptationsandincreasesincapacity.

    WhiletheincreaseinU.S.productionofcrudeoil

    andthereducedU.S.demandfortransportationfuels

    willlikelyreducethedemandfortotalU.S.crudeoil

    imports,itisunlikelytoreducedemandforheavysourcrudeatGulfCoastrefineries.Additionally,as

    wasprojectedinthe2011FinalEIS,themidstream

    industryisshowingitiscapableofdeveloping

    alternativecapacitytomoveWCSB(andBakkenand

    Midcontinent)crudestomarketsintheeventthe

    proposedProjectisnotbuilt.Specifically,itis

    movingtodevelopalternativepipelinecapacitythat

    wouldsupportWesternCanadian,Bakken,and

    MidcontinentcrudeoilmovementstotheGulfCoast

    andisincreasinglyusingrailtotransportlarge

    volumesofcrudeoiltoEast,West,andGulfCoast

    marketsasaviablealternativetopipelines.In

    addition,projectedcrudeoilpricesaresufficienttosupportproductionofessentiallyallWestern

    Canadiancrudeoilprojects(andU.S.tightoil

    projects,suchasthoseintheBakkenshale),even

    withpotentiallysomewhatmoreexpensivetransport

    optionstomarketintheformofalternativepipelines

    andrail.Railandsupportingnon-pipelinemodes

    shouldbecapable,aswasprojectedin2011,of

    providingthecapacityneededtotransportall

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    incrementalWesternCanadianandBakkencrudeoil

    productiontomarketsiftherewerenoadditional

    pipelineprojectsapproved.

    Approvalordenialofanyonecrudeoiltransport

    project,includingtheproposedProject,remains

    unlikelytosignificantlyimpacttherateofextraction

    intheoilsands,orthecontinueddemandforheavycrudeoilatrefineriesintheU.S.Limitationson

    pipelinetransportwouldforcemorecrudeoiltobe

    transportedviaothermodesoftransportation,suchas

    rail,whichwouldprobably(butnotcertainly)be

    moreexpensive.Longertermlimitationsalsodepend

    uponwhetherpipelineprojectsthatarelocated

    exclusivelyinCanadaproceed(suchastheproposed

    NorthernGateway,theTransMountainexpansion,

    andtheTransCanadaproposaltoshipcrudeoileast

    toOntarioonaconvertednaturalgaspipeline).

    Ifallsuchpipelinecapacitywererestrictedinthe

    medium-to-long-term,theincrementalincreaseincostofthenon-pipelinetransportoptionscouldresult

    inadecreaseinproductionfromtheoilsands,

    perhaps90,000to210,000bpd(approximately2to

    4percent)by2030.IftheproposedProjectwere

    deniedbutotherproposednewandexpanded

    pipelinesgoforward,theincrementaldecreasein

    productioncouldbeapproximately20,000to30,000

    bpd(from0.4to0.6percentoftotalWCSB

    production)by2030.

    Fundamentalchangestotheworldcrudeoilmarket,

    and/ormorefarreachingactionsthanareevaluatedin

    thisSupplementalEISwouldberequiredto

    significantlyimpacttherateofproductionintheoil

    sands.Inlightoftheadditionalanalysisperformed,

    asexplainedintheSupplementalEIS,thesechanges

    arenotanticipatedtoaltertheoutlookforthecrude

    oilmarketinamannerthatwouldleadtoachangein

    thekeyconclusionsreachedinthe2011FinalEIS.

    ES.6.3 No Action AlternativeTheNoActionAlternativeincludesanevaluationof

    multiplescenariosthatdescribepotentialoutcomesif

    theDepartmentwastodenythePresidentialPermit

    fortheproposedProject,orifitwasotherwisenot

    constructed.Basedonavailableinformationand

    independentanalysisdiscussedatgreaterlengthin

    thedraftSupplementalEIS,underaNoAction

    StatusQuoAlternative,productionand

    transportationofWCSBandBakkencrudeoilwould

    remainunchanged.Thisscenarioservesasa

    benchmarkagainstwhichotheralternativesare

    evaluated,althoughmarketforceswouldprecludethisscenariofromoccurring.

    GiventhatproductionofWCSBandBakkencrude

    oilwillproceedwithorwithouttheproposedProject,

    thedenialofaPresidentialPermitwouldlikelyresult

    inactionsbyotherfirmsintheUnitedStates(and

    global)petroleummarket,suchasuseofalternative

    modestotransportWCSBandBakkencrudeoil.

    TableES-4comparessomeofthekeycharacteristics

    ofthenon-StatusQuoscenariosunderthis

    AlternativetotheproposedProject.Theindividual

    scenariosaredescribedbelow.

    Table ES-4: Summary of No Action Alternative Scenarios

    Characteristics

    Proposed

    Project

    Rail and

    Pipeline Rail and Vessela

    NewAcreageRequired(permanenteasement) 5,303 7,727 9,427

    AverageAnnualU.S.EmploymentDuringConstruction

    3,900 2,400 0

    ConstructionPeriod 1-2 about2 about2

    Permanent(Operations)U.S.Employment 35 65 0

    a

    IntheRailandVesselscenario,characteristicsofthemarineterminalinKitimatarebasedonthecapitalcostsandemploymentestimatesfortheEnbridgeNorthernGatewaymarineterminal.Informationisavailableathttp://gatewaypanel.review-examen.gc.ca/clf-nsi/dcmnt/pplctn-eng.html

    Executive Summary ES-20 March 2013

    http://gatewaypanel.review-examen.gc.ca/clf-nsi/dcmnt/pplctn-eng.htmlhttp://gatewaypanel.review-examen.gc.ca/clf-nsi/dcmnt/pplctn-eng.html
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    ES.6.3.1 Rail and Pipeline ScenarioUnderthisscenario,WCSBandBakkencrudeoil(in

    theformofdilbitorsynbit)wouldbeshippedvia

    railroadtoStroud,Oklahoma,whereitwouldbe

    loadedintoexistingandexpandedpipelines

    approximately17milestoCushing,Oklahoma,wherethecrudeoilwouldentertheexisting

    Keystonepipelinesystem.

    Thisscenariowouldrequiretheconstructionofseven

    newrailloadingterminalsinLloydminster,

    Saskatchewan(thepossibleloadingpointforWCSB

    crudeoil),oneinEpping,NorthDakota(thepossible

    loadingpointforBakkencrudeoil),andsevenin

    Stroud(seeFigureES-12).Eachnewterminalwould

    requireapproximately500acresofland,aswellas

    newtrack,pipelines,andstoragetanks.

    AssumingshipmentviaClassI(major)railroadssuch

    astheCanadianPacificRailwaySystem(CPRS),

    CanadianNational,BNSFRailwa