House Republicans press for approval of Keystone XL at May 23 hearing

WASHINGTON - House Republicans ratcheted up pressure on the Obama administration to approve TransCanada's proposed Keystone XL pipeline, arguing that the project is essential amid high gas prices and the country's dependence on Middle Eastern oil.

A hearing focusing on the proposed legislation - the North American-Made Energy Security Act of 2011 - was held by the House Energy and Power Subcommittee on the afternoon of May 23 in Washington. The legislation is being backed by top Republicans on the panel.

The bill, if passed by both House and Senate, would expedite the Obama administration's consideration and approval of the pipeline. However, passage in the Democrat-controlled Senate is less likely than approval by the Republican-dominated House.

Pro-Pipeline witnesses dominated the May 23 hearing.

Republicans on the House Energy and Commerce Committee invited a top executive at TransCanada as the key witness to testify at the hearing. He is Alex Pourbaix, TransCanada’s president for energy and oil pipelines.

Altogether, six witnesses offered testimony at the subcommittee hearing chaired by Rep. Ed Whitfield. The Kentucky Republican is one of 16 GOP subpanel members. Rep. Bobby Rush of Illinois is the ranking member among the 11 Democrats on the subpanel.

The invited witnesses in addition to Pourbaix included: Dan McFadyen, chairman of the Alberta Energy Resources Conservation Board; Murray Smith, president of Murray Smith & Associates; Stephen Kelly, assistant general president of the United Association of Plumbers and Pipefitters; James Burkhard, managing director of Global Oil at IHS Cambridge Energy Research Associates; and Jeremy Symons, senior vice president for conservation and education at the National Wildlife Federation.

Symons was the only witness to offer testimony in opposition to TransCanada's plan to extend its already-operating Keystone pipeline by adding on the Keystone XL.

U.S. State Department sued over Hillary Clinton's correspondence with TransCanada Pipeline lobbyist

SAN FRANCISCO, Calif. - Environmental and legal watchdog groups sued the State Department on May 19 to get copies of any communications between Secretary of State Hillary Clinton and a lobbyist for a Canadian oil company seeking approval of a massive proposal oil pipeline.

The lobbyist, Paul Elliott, formerly worked as the national deputy director for Secretary Clinton's presidential campaign. Elliott was then hired by TransCanada Pipelines, Ltd, the company behind the controversial Keystone XL pipeline, which would run through America's Great Plains to refineries on the Gulf Coast. Elliott registered as a lobbyist only after news organizations reported on his lobbying activities on behalf of TransCanada in December 2010. TransCanada needs a permit from Secretary Clinton to build the Keystone XL pipeline.

The suit follows a Freedom of Information Act request filed by Friends of the Earth, Corporate Ethics International, and the Center for International Environmental Law late last year seeking to uncover any communications between Elliott and the State Department that would reveal whether Elliott's former position as campaign director for Secretary Clinton resulted in bias in the permitting process. The State Department initially denied the request for those records on January 5, 2011. A few weeks later, the Department reversed its decision to deny the request but has delayed processing the request, and has not indicated whether or when it will release the information.

The State Department is heading a multi-agency environmental review of TransCanada's Keystone XL pipeline, which would carry Canadian crude oil from Alberta's tar sands to the Texas coast.

"Why is the State Department refusing to release these communications? This calls into question the agency’s decision to rush the review of the Keystone XL pipeline, despite its massive environmental risks and bipartisan opposition to it," Friends of the Earth President Erich Pica said in a statement.

Before deciding whether to grant a permit, the State Department must analyze the pipeline's risks and finalize an Environmental Impact Statement. After the Environmental Protection Agency told the State Department its draft environmental impact statement was inadequate, Secretary Clinton nonetheless said, last October, that the State Department was "inclined to approve" the permit.

Secretary Clinton's agency has been criticized by farmers and ranchers in the pipeline's path for rushing the review process and not holding hearings on the department's latest draft analysis. The State Department plans to make a final decision about the Presidential Permit before the end of 2011.

"Clearly, TransCanada hired Mr. Elliott to take advantage of his previous service to Hillary Clinton," said Kenny Bruno with Corporate Ethics International. "We think the public has a right to know in what ways TransCanada and Mr. Elliott have attempted to influence Secretary Clinton's view of this controversial project."

The public interest law firm Earthjustice represents Friends of the Earth, Center for International Environmental Law, and Corporate Ethics International.

"This raises important questions of transparency and fairness," said Sarah Burt, an Earthjustice attorney. "If a decision to approve a transcontinental pipeline is made based on relationships and access to Clinton, while completely overlooking the significant environmental and public health dangers posed by the pipeline, the public needs to be aware of it."

Read the complaint here.(Source: Earthjustice news release)

BP, Conoco-Phillips kill Denali pipeline proposal

JUNEAU, Alaska - One of two groups planning to build major natural gas pipelines in Alaska has dropped its bid, saying on May 17 that it didn't get the shipping agreements necessary to justify continuing.

The announcement came from the Denali partners - BP and ConocoPhillips.

Denali had been competing to build a line with Calgary-based TransCanada Corp. and partner ExxonMobil. The latter continue to press ahead with their proposal.

Denali said it is withdrawing its application before the U.S. Federal Energy Regulatory Commission after spending US$165 million and investing more than 760,000 man-hours in the effort.

In a statement, Denali said it didn’t have the required commitments to move ahead with the application.

“Denali is a market-driven company. As such, we cannot spend the billions of dollars necessary to advance the project unless we have binding agreements with shippers,” said Bud Fackrell, Denali president. “Although we have been in discussions with potential shippers for nearly a year and half, we have been unable to secure the financial commitments necessary to advance the project.”

TransCanada officials said that although it remains the sole survivor, Denali’s decision to withdraw doesn’t guarantee it will be able to come to commercial terms with Alaskan producers.

It plans to present its own application to the FERC in October of 2012.

Syncrude prices gain as wildfires in Canada shut in crude output

CALGARY, Alta. - The premium for Canadian syncrude rose as fires in northern Alberta forced crude oil producers to shut output and Plains All American Pipeline LP to close a pipeline section.

As of early May 16, 116 wildfires were burning in Alberta, 39 of them out of control, the provincial government said. A total of 206 square miles had been burned by then.

Warm, dry and windy conditions were fueling the blazes, which were cutting a swathe across central Alberta.

The government deployed 1,000 firefighters, 100 helicopters and 20 water bombers to battle the blazes. In addition, 200 more firefighters were expected to arrive from other Canadian provinces.

Cenovus Energy Inc. said it expected to suspend production at a large oil field in northern Alberta on May 16 due to the wildfires. Cenovus said 22,000 b/d of production at its Pelican Lake site would remain shut. A company spokeswoman said it had sufficient storage to keep producing until May 17.

Exall Energy Corp. shut its Marten Mountain plant which produces 1,750 barrels per day, the company said in an e-mailed statement.

Toyota opens first pipeline-fed hydrogen fueling station in U.S.

TORRANCE, Calif. - Toyota opened the first hydrogen fueling station in the U.S. fed directly from an active industrial hydrogen pipeline on May 10.

Located adjacent to the Toyota Motor Sales, U.S.A. sales and marketing headquarters campus in Torrance, the station is a joint effort between Toyota, Air Products and Shell Hydrogen, and received funding from South Coast Air Quality Management District and the U.S. Department of Energy.

Shell owns and operates the facility, and Air Products provides onsite equipment, and station maintenance, and provides the station with hydrogen gas through a pipeline from its plants in Wilmington and Carson, Calif.

The hydrogen will be used to power fuel-cell vehicles that are in the early stages of development. The hydrogen-powered vehicles are more energy efficient and won't produce harmful emissions.

While Toyota doesn't currently offer a line of fuel-cell automobiles, it will use the facility to fuel vehicles in its fuel-cell hybrid demonstration program, and will open the station to other manufactures' fuel-cell vehicle fleets.

"Building an extensive hydrogen refueling infrastructure is a critical step in the successful market launch of fuel-cell vehicles," said Chris Hostetter, TMS group vice president, product and strategic planning, in a news release. "We plan to bring a fuel-cell vehicle to market in 2015, or sooner, and the infrastructure must be in place to support our customers' needs."

To spur the development of that infrastructure prior to fuel-cell cars actually being for sale, Toyota's nationwide demonstration program plans to place 100 of the latest generation of fuel-cell hybrid vehicles, which can achieved an estimated 431 miles on a single fill of hydrogen, with partners by 2013.

Alon Krotz Springs provides update of flooding on Louisiana operations

DALLAS, Texas - Alon Refining Krotz Springs, Inc. on May 11 provided an update on the potential impact on its Louisiana operations of record flooding of the Mississippi River that is affecting refineries, other businesses and residents throughout the Southern United States.

The operation of the Alon refinery located in Krotz Springs, La., may be disrupted by the opening of the Morganza Spillway by the Army Corps of Engineers (ACE) to combat the rising levels of the Mississippi River.

According to ACE projections, the opening of the Morganza Spillway will result in higher water levels on the Atchafalaya River almost immediately, and within 10 to 14 days, floodwaters could migrate north to the area surrounding the refinery.

Alon said it is finalizing a plan to further protect the refinery and its equipment by constructing an additional levee to prevent floodwaters from entering into the refinery property. This new levee would supplement the existing levees on the North and East sides of the refinery. Additionally, this levee will join a new proposed levee to be constructed by the city of Krotz Springs to protect homes in Southern neighborhoods.

Alon has also taken steps to minimize damage to its docks and other property that will remain outside of the levee system.

Alon believes that any interruptions of barge and pipeline service that result could prevent the refinery from running at full rates for several weeks. It is also possible that Alon may be required to fully idle the facility for some of this time due to logistical or safety issues.

Paul Eisman, the company's CEO and president, commented, "Our primary concerns are the safety of our people and minimizing the longer term impact of these floods on the facility. We are taking steps to insure the orderly and safe shutdown of the refinery if the need arises."

Alon Refining Krotz Springs, Inc., a subsidiary of Alon USA Energy, Inc., owns and operates a high conversion crude oil refinery in Krotz Springs, with a crude oil throughput capacity of approximately 83,000 barrels per day. The Krotz Springs refinery is located on the Atchafalaya River with direct access to the Colonial products pipeline and the Exxon crude system and services markets in the Southern and Eastern United States. (Source: PRNewswire, May 11, 2011)