Tuesday, January 20, 2015

I really feel bad for US Senators that don't have their facts straight.

US Senator Hoven from North Dakota. "If the USA doesn't build the KXL then Canada will ship the oil to China." So, what? There is nothing to say Canada won't export to China anyway. They are already building a pipeline to their west coast.

And this is from the Republican coveted "Wall Street Journal." 

April 12, 2015
 
CALGARY— Kinder Morgan Energy Partners LP (click here) said Thursday it will begin a $5 billion expansion of its Trans Mountain pipeline, nearly tripling the capacity of crude oil it can ship to Canada's west coast—the latest project aimed at moving the country's rising oil production to markets outside the U.S....


The reason TransCanada wants to make it to the USA's refineries in the south is due to their status as "Free Trade Zones." That status is to sell internationally TAX FREE.

Now a word from the Progressive side of the aisle.

...Canada doesn’t have nearly enough oil to fill (click here) existing pipelines going to the United States. However, existing Canadian oil pipelines all go to the Midwest, where the only buyer for their crude is the United States. Keystone XL would divert Canadian oil from refineries in the Midwest to the Gulf Coast where it can be refined and exported. Many of these refineries are in free trade zones where oil may be exported to international buyers without paying U.S. taxes...

So, everyone, should get their facts straight. The KXL has nothing to do with providing domestic oil to the USA, it is completely about skirting the international structure in regard to oil sales. Otherwise, why build it? There are plenty of other pipelines. Far too many actually.

Setting aside the huge environmental burden this pipeline would provide, the real question is; "What will this pipeline do to international relationships with the USA?" The KXL is about cheating. That doesn't play well in international relations.

The final destination of the KXL is Port Arthur and Houston in Texas.

This is the law:

§ 81c. Exemption from customs laws of merchandise brought into foreign trade zone (click here)

This is the reason for the law:

The FTZ program encourages U.S.-based operations by removing certain disincentives associated with manufacturing in the United States (click here) 

There are several Foreign Trade Zones in Port Arthur and Houston, Texas. (click here)