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Report: Koch Industries Oil Affiliate Has Major Interest in Tarsands, Keystone XL Pipeline

David Koch and Charles Koch want to use your money

The good folks over at InsideClimateNews have been tracking the assault by Koch Industries on the environmental and health regulations and global climate science.

Now they’ve come across a link between Koch Industries and the Keystone XL Pipeline project and tar sands oil development.  And the link was sitting there in plain sight.

Much of the focus on the tar sands oil extraction and the various legs of the Keystone XL Pipeline was naturally on the companies that extracted the oil and the companies involved in the pipeline construction and operation. But the obvious question was, who’s buying the tar sands oil and shipping it through the pipeline?  Well, the answer is, an affiliate of Koch Industries.   From InsideClimateNews:

In 2009, Flint Hills Resources Canada LP, an Alberta-based subsidiary of Koch Industries, applied for—and won—”intervenor status” in the National Energy Board hearings that led to Canada’s 2010 approval of its 327-mile portion of the pipeline. The controversial project would carry heavy crude 1,700 miles from Alberta to the Texas Gulf Coast.

In the form it submitted to the Energy Board, Flint Hills wrote that it “is among Canada’s largest crude oil purchasers, shippers and exporters. Consequently, Flint Hills has a direct and substantial interest in the application” for the pipeline under consideration.

To be approved as an intervenor, Flint Hills had to have some degree of “business interest” in Keystone XL, Carole Léger-Kubeczek, a National Energy Board spokeswoman, told InsideClimate News. Intervenors are granted the highest level of access in hearings, with the option to ask questions. The Energy Board approved Canada’s segment of the pipeline with little opposition, and Flint Hills did not exercise its right to speak. . . .

InsideClimate News contacted the Flint Hills manager who filed the Canadian document. She referred questions to Koch Industries general counsel Mark Holden, who did not return calls. Neither did Koch spokespeople.

So how big an oil buyer and shipper is Flint Hills? From a February InsideCliimateNews report: [cont’d]

A SolveClimate News analysis, based on publicly available records, shows that Koch Industries is already responsible for close to 25 percent of the oil sands crude that is imported into the United States, and is well-positioned to benefit from increasing Canadian oil imports.

A Koch Industries operation in Calgary, Alberta, called Flint Hills Resources Canada LP, supplies about 250,000 barrels of tar sands oil a day to a heavy oil refinery in Minnesota, also owned by the Koch brothers.

Flint Hills Resources Canada also operates a crude oil terminal in Hardisty, Alberta, the starting point of the proposed Keystone XL pipeline.

The company’s website says it is “among Canada’s largest crude oil purchasers, shippers and exporters.” Koch Industries also owns Koch Exploration Canada, L.P., an oil sands-focused exploration company also based in Calgary that acquires, develops and trades petroleum properties.

So, a substantial portion of the environmentally damaging tar sands oil extraction is sold to an affiliate of Koch Industries, and the major customer for the Keystone XP Pipeline is the same affiliate of Koch Industries, which then supplies oil refineries owned by Koch Industries.

Now there’s nothing illegal about companies buying oil from producers and shipping that oil via pipelines to their own refineries.   And since some of those refineries are near the US Canadian border or in the US, you”re probably using their refined fuels in some form.

But you have to ask yourself if you want the dollars you spend on energy to be going to the $50 billion Koch brothers, who then use your dollars to derail sensible health and environmental regulation, bribe foreign officials, pollute the nation’s political discourse, and elect people who then destroy unions, shrink government services, punish safety net beneficiaries, and help elect jerks that undermine American democracy.

And you have to wonder what’s going through the heads of the Obama Administration as they decide whether these projects are in the national interest, not to mention how all that money affects the prospects for Mr. Obama’s own reelection.

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John has been writing for Firedoglake since 2006 or so, on whatever interests him. He has a law degree, worked as legal counsel and energy policy adviser for a state energy agency for 20 years and then as a consultant on electricity systems and markets. He's now retired, living in Massachusetts.

You can follow John on twitter: @JohnChandley