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Gulf-Bound Tar Sands for Export? Follow the Oiltanking Trail

The U.S. Senate failed to get the necessary 60 votes to approve the northern leg of TransCanada‘s KeystoneXL pipeline, but incoming Senate Majority Leader Mitch McConnell (R-Ky.) already promised it will get another vote when the GOP-dominated Senate begins its new session in 2015.

Though the bill failed, one of the key narratives that arose during the congressional debate was the topic of whether or not the tar sands product that may flow through it will ultimately be exported to the global market. President Barack Obama, when queried by the press about the latest Keystone congressional action, suggested tar sands exports are the KXL line’s raison d’etre.

Obama’s comments struck a nerve. Bill sponsor U.S. Sen. Mary Landrieu (D-La.) and supporter U.S. Sen. John Hoeven (R-ND) both stood on the Senate floor and said Keystone XL is not an export pipeline in the minutes leading up to the bill’s failure.

“Contrary to the ranting of some people that this is for export…Keystone is not for export,” said Landrieu, with Hoeven making similar remarks.

But a DeSmog probe into a recent merger of two major oil and gas industry logistics and marketing companies, Oiltanking Partners and Enterprise Products Partners, has demonstrated key pieces of the puzzle are already being put together by Big Oil to make tar sands exports a reality.

And both Keystone XL and Enbridge‘s “Keystone XL Clone” serve as key thoroughfares for making it happen. 

Oiltanking-Enterprise Marriage

On November 13, the day before the U.S. House of Representatives voted to approve Keystone XL North, Enterprise acquired Oiltanking. Both companies stand to gain from its prospective approval, as well as the recent approval of KeystoneXL’s Clone, and both companies have made big bets on fossil fuel exports at-large.

The Keystone XL clone — the Alberta to Freeport, Texas combination of Enbridge’s Alberta ClipperFlanagan South and Seaway Twin pipelines — has a key tie to Enterprise Products. That is, Enterprise co-owns the Cushing, Oklahoma to Freeport, Texas Seaway Twin pipeline with Enbridge.

In June, Enterprise received one of the first oil export permits in more than four decades from the Obama Administration.

Oiltanking, in turn, owns two key Gulf-area terminals that will serve as a final destination for Enbridge’s tar sands diluted bitumen (“dilbit”)One of them sits in the Houston Ship Channel, while the other sits in Beaumont, Texas.

As covered previously on DeSmogBlog, Keystone XL South has a key fork in the road called the Houston Lateral Pipeline that will supply Houston’s refinery row with dilbit. An article published in RBN Energy by Sandy Fielden explained that TransCanada’s Houston Lateral will feed into Oiltanking’s Houston Ship Channel terminal.

Seaway Twin also has two lateral pipelines in the works from Freeport, one of which will deliver dilbit to the Oiltanking-owned Houston Ship Channel terminal.

Enterprise: Oiltanking for Fossil Fuel Exports

The interconnected business plans of Enterprise and Oiltanking, with Enterprise accounting for 30 percent of Oiltanking’s sales prior to acquisition, further calls into question whether the pipelines have anything to do with “energy independence.”

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