Labor Day News Dump: FERC Hands Enbridge Permit for Tar Sands by Rail Facility

picture-7018-1583982147.png
on

On the Friday before Labor Dayย โ€” in the form of an age-old โ€œFriday News Dumpโ€œย โ€” the Federal Energy Regulatory Commission (FERC)ย handed a permit toย Enbridge, theย tar sands-carrying corporate pipeline giant,ย to open a tar sands-by-rail facility in Flanagan, Ill. byย early-2016.ย 

With the capacity to accept 140,000 barrels of tar sands product per day, the company’s rail facility serves as another step in the direction towards Enbridge’s quiet creation of a โ€œKeystone XL Clone.โ€ That is, like TransCanada’s Keystone Pipeline System sets out to do, sending Alberta’s tar sands all the way down to the Gulf of Mexico’s refinery rowย โ€” and perhaps to the global exportย market.

Flanagan sits as the starting point of Enbridge’s Flanagan South pipeline, which will take tar sands diluted bitumen (โ€œdilbitโ€) from Flanagan to Cushing, Okla. beginning in October, according to a recent company earnings call. From there, Enbridge’sย Seaway Twin pipeline will bring dilbit to Port Arthur, Texas near theย Gulf.

Enbridge made the prospect of a tar sands-by-rail terminal public for the first time during its quarter two investorย call.

โ€œIn terms of the rail facility, one of the things we’re looking at is โ€“ and the rail facility is really in relation to the situation in western Canada where there is growing crude oil volumes and not enough pipeline capacity to get it out of Alberta for a two or three year period,โ€ย Guy Jarvis, president of liquids pipelines for Enbridge, said on the call.

โ€œSo, one of the things we’re looking at doing is constructing a rail unloading facility that would allow western Canadian crudes to go by rail to Flanagan, be offloaded, and then flow down the Flanagan South pipeline further into Seaway and to theย Gulf.โ€

FERC has given Enbridge the permit it needs to make thatย happen.

Enbridge โ€œSchemeโ€ Receives MNย Permit

The announcement comes just days after the U.S. Department of State handed Enbridge a controversial permit to move an additional 350,000 barrels of tar sands per day across the U.S.-Canada border without the legally conventional Presidential Permit, public hearings or an environmental review conducted by the Stateย Department.

Enbridge also received a permit from the Minnesota Public Utilities Commissionย (MPUC) the day before FERC‘s โ€œFriday News Dump,โ€ locking in the State Department’s legal ruling at the state-level.ย MPUC voted 4-1 to permit the pipeline after a meeting lasting nearly eight hours.ย 

The Commission did so even though the staffer analyzing comments and legal submissions acknowledged he reviewed far more climate and environmental concerns than vice versa, according to MPUC staff briefing papers reviewed byย DeSmogBlog.

โ€œClearly there exists much public opposition to the increased consumption of fossil fuels and diluted bitumen sources in particular,โ€ wroteย Michael Kaluzniak, planning director for energy facilities permitting for MPUC.ย 

โ€œAdditionally, the Commission received numerous comments expressing genuine concern regarding the potential impact of the project on water quality and overall dissatisfaction with Enbridgeโ€™s public safety and spill response actions.โ€ย 

TransCanada and Tar Sands byย Rail

With the combination of its Alberta Clipper expansion โ€œillegal schemeโ€ (referred to as such by the National Wildlife Federation), Flanagan South and Seaway Twin pipelines, as well as the FERC-approved rail facility, Enbridge now has the capacity to bring roughly 960,000 barrels per day of tar sands product to theย Gulf.

For sake of comparison, Keystone XL has the capacity to bring 830,000 barrels per day of tar sands to the Gulf. But TransCanada has also brokered its own deals and made its own chessย moves.ย 

As reported on DeSmogBlog, TransCanada may build its own tar sands-by-rail facility while it waits for Keystone XL‘s northern leg to receive โ€”ย or not receiveย โ€” a State Department permit and accompanying Presidential Permit.ย ย 

โ€œIt is somethingโ€ฆthat we can move on relatively quickly,โ€ย TransCanada CEOย Russ Girlingย stated on his company’s quarter one earnings call. โ€œWeโ€™ve done a pretty substantial amount of work at the terminal end and mostly at the receipt and delivery points and thatโ€™s really what our key role in here wouldย be.โ€

Since that call, TransCanada has not discussed its tar sands by rail businessย plans.

โ€œKeystone? Who needsย it?โ€

In July,ย Global Partners and Kansas City Southern announced plans to develop a tar sands by rail facility in Port Arthur, Texas withย 340,000 barrels of storage capacity.

If TransCanada opens up its own tar sands by rail facility, the combination of that and Enbridge’s latest tar sands by rail move could feed the Global Partners-Kansas City Southernย beast.

With tar sands now โ€œTexas Bound and Flyinโ€ in a major way, and both Enbridge and TransCanada finding a way to get tar sands to the Gulf, the seemingly hyperbolic headline published on July 10 by the Houston Business Journal seems to ring trueย moreย now than ever: โ€œKeystone? Who needs it?โ€

Photo Credit: Wikimediaย Commons

picture-7018-1583982147.png
Steve Horn is the owner of the consultancy Horn Communications & Research Services, which provides public relations, content writing, and investigative research work products to a wide range of nonprofit and for-profit clients across the world. He is an investigative reporter on the climate beat for over a decade and former Research Fellow for DeSmog.

Related Posts

on

New documents show close coordination between the oil major and a coalition of free-market think tanks at a crucial moment in climate diplomacy.

New documents show close coordination between the oil major and a coalition of free-market think tanks at a crucial moment in climate diplomacy.
Analysis
on

Right wing YouTuber Tim Pool is the latest to own โ€˜climate peopleโ€™ with fake facts spouted by a grizzled TV oilman.

Right wing YouTuber Tim Pool is the latest to own โ€˜climate peopleโ€™ with fake facts spouted by a grizzled TV oilman.
on

Critics say the controversial GWP* method โ€“ which New Zealand appears close to adopting โ€“ is โ€œopen to significant abuseโ€.

Critics say the controversial GWP* method โ€“ which New Zealand appears close to adopting โ€“ is โ€œopen to significant abuseโ€.
on

Lord Moynihan of Chelsea, who holds shares in Shell and TotalEnergies, called the green transition a โ€œchildrenโ€™s crusadeโ€.

Lord Moynihan of Chelsea, who holds shares in Shell and TotalEnergies, called the green transition a โ€œchildrenโ€™s crusadeโ€.