Source: USAToday.com, April 14, 2013
Posted on: http://envfpn.advisen.com
Two oil projects in the works could significantly increase the amount of heavy crude oil moving on — and near — the Great Lakes, causing alarm among environmentalists because they involve the same heavy oil that was behind a $1-billion oil spill on the Kalamazoo River in 2010 that remains an ecological disaster.
The company fined for that spill — Canadian oil transport giant Enbridge — is behind one of the new projects. Its new venture would nearly double the amount of crude oil shipped on a major pipeline from Canada to Lake Superior — transporting more oil than the controversial Keystone XL pipeline that has caused an environmental outcry and fierce debate in Congress. The second project involves a refinery on Lake Superior’s shore building a dock to load oil barges, allowing the shipment of up to 13 million barrels of crude oil per year throughout the Great Lakes to Midwest refineries and markets beyond.
Together, the projects would mean a new reality for the Great Lakes basin, heightening risks to the world’s most vital freshwater source, according to environmental groups.
“It’s pretty alarming,” said Beth Wallace of the National Wildlife Federation’s Great Lakes Regional Center in Ann Arbor, Mich. “We’ve known for a while that the Midwest has been the major consumer for these tar sands. Now, we’re becoming the transportation hub for it.”
Added Nancy Shiffler, a Sierra Club volunteer based in Ann Arbor, “Oil tankers on Lake Superior; what could possibly go wrong? That clearly sounds like a bad idea.”
Officials from Enbridge and the company behind the dock, Calumet Specialty Products Partners say they can run their operations safely.
“We have six pipelines that cross the (U.S.-Canadian) border now,” said Denise Hamsher, director of project planning for Enbridge’s major projects group. “They’ve been transporting crude oil since the 1950s and have been transporting oils from the Canadian oil sands for decades.”
What’s often being shipped isn’t the oil seen gushing out of Texas oil towers in old movies. It’s tar sands crude or dilbit, a semisolid form of petroleum also known as diluted bitumen.
The sludgy product requires mixture with chemicals or other petroleum products to move through pipelines. Environmentalists argue it’s a far harsher product on pipelines, and much more difficult to clean up when spills happen. It was dilbit that spilled during the worst inland oil spill in U.S. history, a July 26, 2010, pipe breach in Marshall that devastated wetlands, Talmadge Creek and the Kalamazoo River. The product combined with river sediments and sank to the bottom, making traditional oil cleanup booms and surface skimmers ineffective.
The U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration, or PHMSA, fined Enbridge $3.7 million as a result of the spill. Last month, the Environmental Protection Agency ordered Enbridge to do additional river-bottom dredging to clean up the spill. The company announced last month that it expects cleanup costs to exceed $1 billion.
Now, Enbridge is seeking federal approval to nearly double the capacity of oil shipped on its Line 67, or Alberta Clipper pipeline, a 36-inch diameter line that runs 1,000 miles from the western Canadian oil sands region east to Superior, Wis., on the shore of Lake Superior. If approved, the pipe could ship up to 880,000 barrels of oil per day.
Growth and concern
Enbridge’s expansion is occurring even though PHMSA ordered the company last August to submit comprehensive plans to improve the safety record of its entire, 1,900-mile pipeline system, which extends into 16 U.S. states. PHMSA officials cited multiple recent pipeline failures and concern that the company’s ability to ensure the safety of its system is inadequate.
“There’s such a large hole in the regulations that are in place that they are able to expand a pipeline network that’s currently being designated unsafe by PHMSA,” Wallace said.
The debate on whether the U.S. should ramp up its use of heavy crude oil has largely centered on TransCanada’s Keystone XL pipeline proposal, which would deliver more than 800,000 barrels of heavy crude from the Canadian province of Alberta through the continental U.S. to refineries in Texas. Proponents say the pipeline will create jobs and provide a reliable source for petroleum that doesn’t come from overseas nations sometimes hostile to U.S. interests. Opponents question the safety of the pipelines, the environmental impact of the tar sands and how many jobs would actually be created.
But more quietly, Canadian firms such as Enbridge have expanded movement of Canadian oil sands south and east. Enbridge’s Alberta Clipper pipeline began operation in 2010 and transports about 450,000 barrels of crude oil per day into the U.S.
Wallace questioned the continued approval of expanded pipeline operations for Enbridge, noting that the dilbit it delivers “is a completely different product.” The U.S. government doesn’t even consider it crude oil, she said.
“Oil companies have absolutely no idea how to clean it up,” she said. “It’s very concerning we are allowing these expansions to go on throughout the Great Lakes region without understanding these basic issues.”
From railways to water
Relatively little shipping of oil currently occurs on the Great Lakes. That will soon change if Calumet Specialty Products Partners gets its way.
The company operates a refinery in Superior, Wis., on Lake Superior’s shore. It’s exploring building and operating a crude oil loading dock on Lake Superior through which up to 13 million barrels of crude oil per year would be transported, according to a company filing with the Wisconsin Department of Natural Resources.
“We have kind of a strategically located access there in Superior, with access to the Great Lakes,” said Todd Borgmann, vice president of business development for Calumet.
A considerable amount of crude oil transport is occurring on railways, “and barges are more efficient, safer and more economical than rail,” he said.
According to a 2010 Army Corps of Engineers study, 3.7 million tons of petroleum products were shipped on the Great Lakes that year on both foreign and domestic ships, with just 48,000 tons of that crude petroleum. That’s dwarfed by the nearly 51 million tons of iron ore, 31 million tons of coal and 26 million tons of sand, gravel and other rock products shipped on the lakes.
Rules and monitoring
Lt. Judson Coleman, chief of waterways management for the Coast Guard’s Marine Safety Unit in Duluth, Minn., said he has only looked into the Calumet dock project unofficially, as no formal proposal has been submitted for consideration.
The Coast Guard’s requirements would include adequate equipment and ability to respond to spills, as well as requirements that oil tanker ships have the double hulls required on all new tankers using U.S. ports since the Exxon Valdez oil spill disaster in Alaska in 1989. The project would also require permitting from the Wisconsin DNR.
“Obviously, there are concerns,” Coleman said. “But we have those regulations in place for a reason. As long as companies are meeting those requirements, they are doing what we require them to do.”
Recent years of lower lake levels have resulted in cargo ships carrying reduced loads to avoid hitting bottom on Great Lakes shipping channels. That and other factors make shipping oil on the Great Lakes ill-advised, said the Sierra Club’s Shiffler.
“If they are going to be shipping more of the tar sands oil out of Canada, the consequences of a spill of that kind of stuff, as we’ve already seen with the Kalamazoo River, is pretty problematic,” she said. “One spill from a large tanker can do an awful lot of damage. I’m not sure it’s a risk we want to take with Lake Superior.”