Hoeven: Pipeline Will Transport Bakken Crude More Safely and Efficiently, Provide Greater U.S. Energy Independence

Senator's Keystone Legislation Important to North Dakota and the Nation

BISMARCK, N.D. – Senator John Hoeven was joined today by TransCanada’s President (Energy and Oil Pipelines) Alex Pourbaix and MDU Resources President and CEO Terry Hildestad to underscore the importance of the Keystone XL Pipeline. Along with transporting Canadian crude, the pipeline will carry 100,000 barrels per day of oil from the U.S. Bakken to Oklahoma and Gulf Coast refineries, reducing truck traffic and improving crude prices in North Dakota while providing good jobs and greater energy independence for the nation. 

The $7 billion, high-tech transcontinental petroleum pipeline will carry 830,000 barrels a day of oil to U.S. refineries, including 150,000 barrels of oil a day from the Bakken and Cushing regions. The increase in North Dakota takeaway would be the equivalent of replacing approximately 500 truckloads of oil per day from roads in western North Dakota, relieving pressure on infrastructure and improving public safety. According to Tad True, whose company, True Companies, is planning to build feeder pipelines in North Dakota contingent on approval of the Keystone XL pipeline, the new gathering system will translate into a reduction of nearly 50,000 truck-miles per day, or 17 million truck-miles per year, on western North Dakota roads, including Highways 85 and 22. According to Lynn Helms, the Director of the North Dakota Department of Mineral Resources, the new pipeline capacity will also reduce the discount on North Dakota crude, increasing the price producers get by $4 per barrel. 

“Building the Keystone XL pipeline is good for North Dakota and it’s good for our nation,” Hoeven said. “The Keystone will collect Bakken crude and move it to refineries more efficiently and with good environmental stewardship. The pipeline will also help to address two of our nation’s greatest challenges—high unemployment and increasing energy costs—creating thousands of good jobs and ensuring that we use more energy from the Bakken and Canada, as opposed to unstable sources in the Middle East.” 

The project would increase total Canadian oil importation by more than 30 percent. As the United States’ No. 1 oil trading partner, Canada supplies nearly as much oil as our next two largest suppliers combined. The increased imports from Canada would reduce U.S. reliance on Middle Eastern sources. 

“Senator Hoeven has been a strong supporter of Keystone XL because he understands the energy and national security implications of importing even more oil from regions that do not share America’s interests or values,” said Pourbaix. “The Canadian and American oil that will be transported through Keystone XL will provide much needed product to U.S. refineries while providing important jobs to American workers at a time of continued economic uncertainty.” 

Already, a separately operating Keystone pipeline runs through eastern North Dakota on its route from Canada to Patoka, Ill., and Cushing, Okla.  The new Keystone XL would run through eastern Montana and expand existing pipeline capacity, while creating thousands of new jobs. 

“Business in the Bakken is growing for every one of MDU Resources’ businesses because of the infrastructure needed to support oil production, which just exceeded 500,000 barrels per day,” said Hildestad. “We currently have roads and other infrastructure projects in the works, including over $60 million of work on the books for our Knife River construction materials business.  The Keystone pipeline will also be critical in helping to meet the infrastructure needs of North Dakota and will create even more opportunity and more jobs for our state and our nation.” 

Hoeven introduced legislation in November to clear the way to build the Keystone XL Pipeline. The bill, introduced by Hoeven and Sen. Dick Lugar of Indiana, would require the Secretary of State to issue a permit within 60 days to allow the Keystone XL project to move ahead unless the President determines that it is not in the national interest. Congress passed the Keystone provision in late December as part of a package to extend the payroll tax cut, unemployment benefits and other expiring provisions. The President must make a decision by the end of February. 

The U.S. State Department has completed a thorough Environmental Impact Statement that found no significant impacts for the 1,700-mile project and had said it would make a decision by the end of 2011. President Barack Obama, however, put the project on hold in early November when he announced that his Administration would review new routes for the pipeline in an effort to circumvent an environmentally sensitive area of Nebraska. The Keystone legislation passed in December addresses that issue by allowing Nebraska to decide the route the pipeline should take through its state, and does not limit that process to 60 days.