Keystone XL Pipeline Rejection Too Late? Critics Say US, Canada Have Already Embraced Alternative Oil Solutions

U.S. President Barack Obama made political waves Friday when he deep-sixed the Keystone XL pipeline proposal, but media outlets such as Forbes called his decision simply symbolic. The flow of oil from Canada to the U.S. has increased in recent years -- and likely will continue to do so despite the president’s announcement.

In July 2010, the U.S. imported about 1.9 million barrels of Canadian crude oil a day. In July 2015, the comparable figure was 2.8 million barrels, according to data compiled by the U.S. Energy Information Administration. The U.S. has also begun relying heavily on railways, as opposed to pipelines, to transport the commodity. “Keystone or no, Canadian oil will still get to market,” Forbes wrote.

The Wall Street Journal reported a similar story, although its article ran before Obama nixed the pipeline because of its potential contribution to climate change. The Journal cited analysts who indicated the 1,200-mile pipeline commissioned in 2010 may have lost its relevancy due to all the delays.

“No oil producer or refiner will think it’s advantageous that Keystone’s permit has been pulled, but it’s not the only option,” said Tim Fitzgibbon, a senior expert on oil and gas at McKinsey & Co. in Houston. He noted railroad trains now transport almost 1 million barrels of oil a day in the U.S., while some companies pump more oil through existing pipelines. These two methods may not be as efficient and safe as the Keystone pipeline would have been, but the system likely will survive. U.S. oil imports from Canada even broke a record in August.

Globe and Mail contributor Stephen Kelly, a retired U.S. diplomat, wrote a piece noting Canadian oil accounted for nearly one-half of all U.S. crude-oil imports.

“It got here without Keystone XL because oil producers, seeing the writing on the wall, discovered that trains can carry as much oil as Keystone XL, without a presidential permit,” Kelly wrote. “We like your oil, and we’ll keep buying it as long as you’ll send it to us -- however you get it here.”