As the war in Ukraine grinds on, a look at the economic battlefield and how the conflict might permanently reshape the global economy. Diane talks to Sebastian Mallaby, senior fellow for international economics at the Council on Foreign Relations.
In March of this year, an Exxon Mobil pipeline in Arkansas burst, spilling about 200,000 gallons of thick Canadian crude oil. Three years ago in Michigan, an Enbridge Energy pipeline ruptured. More than 840,000 gallons of oil spewed into the Kalamazoo River. Communities in both states are still dealing with the aftermath. The fear of a major oil spill is one of the reasons many environmentalists are fighting the proposed Keystone XL pipeline. Industry experts argue pipeline technology has improved greatly in recent years. They say Keystone will be safe and will help the U.S. economy. Diane and her guests discuss the latest news on the oil spills and the safety of shipping oil through pipelines.
- Dan Frosch Reporter for The New York Times.
- Andrew Black President and CEO of Association of Oil Pipe Lines.
- Anthony Swift Attorney with the Natural Resources Defense Council.
- Dustin McDaniel Attorney general of Arkansas.
- Richard Adams Senior vice president for operations at Enbridge Energy Partners.
MS. DIANE REHMThanks for joining us. I'm Diane Rehm. President Obama is expected to decide later this year whether to approve construction of the Keystone XL pipeline. It would carry thick oil sands crude from Canada to the Gulf of Mexico. Two recent oil pipeline spills in Arkansas and Michigan are cited by environmental groups who oppose Keystone XL. The pipeline and oil industries insist new technology will ensure safety at Keystone.
MS. DIANE REHMWe bring you up to date on the Arkansas and Michigan spills and talk about oil pipeline safety. Joining me in the studio, Andrew Black of the Association of Oil Pipe Lines and Anthony Swift of the Natural Resources Defense Council. By phone from Santa Fe, New Mexico, Dan Frosch of The New York Times. We'll take your calls throughout the hour. Join us at 800-433-8850, send us an email to email@example.com, follow us on Facebook, or send us a tweet. Welcome to all of you.
MR. DAN FROSCHGood morning.
MR. ANDREW BLACKGood morning.
MR. ANTHONY SWIFTGood to be here.
REHMAnd, Dan, could I start with you. I know you've done recent reporting on the oil spills in both Arkansas and Michigan...
REHMGive us an overview of what happened in each incident.
FROSCHSure. These are two very different spills, though, at some level there's some real similarities. In Michigan, you have what amounted to the largest crude oil pipeline spill in U.S. history. It happened in July of 2010 when an Enbridge pipeline ruptured near Marshall, Mich. This was a pipeline where inspections had revealed considerable problems in years prior to the spill, but it turned out the company had not fixed many of the issues at the time of the accident.
FROSCHSo all told, we're talking about a spill that hemorrhaged about or more than 840,000 gallons of oil sands crude into the Kalamazoo River and Tallmadge Creek. It was such an intense accident. There was so much oil that people in the area recalled seeing the waterways completely black with oil. And some 40 miles of river had to be closed because of the spill. And then three years later, a painstaking cleanup that has had a profound impact on Marshall and the surrounding area is still ongoing.
FROSCHNow, the spill in Mayflower, Ark. is much more recent. This happened in March of this year, and it was considerably smaller with about 210,000 gallons but still considered a significant spill by federal standards. In this case, we're talking about an Exxon pipeline that was also carrying heavy Canadian crude, much like the Enbridge spill.
FROSCHAnd in this case, the spill took place in a very small Arkansas town, about 30 miles or so from Little Rock. And it appeared to happen essentially directly underneath a subdivision there and ended up sending a sheen of oil through one of the main streets in the subdivision. And so immediately after the spill, there were 22 homes evacuated, and most of those homes are still unoccupied.
REHMYou mentioned the efforts at cleanup and the profound impact on the people in Michigan. Describe that as well as what's happened in Arkansas.
FROSCHWell, I think in Michigan what we've seen are different stages of an impact, if you will, I mean immediately following the spill, there was obviously a large amount of concern with regards to health and safety and so forth. And as time has passed, the concern has switched a bit, and we're now talking about the folks who have been displaced because of the spill, people who have had to sell their homes to Enbridge or folks who no longer want to live in the area because of the spill.
FROSCHAnd I think even more immediately than that, we have sections of the river that had had to been closed down once again to cleanup oil that has remained in the river, submerged oil, if you will. So there are residents and communities kind of downstream of Marshall that are not happy with the fact that the cleanup has seemingly continued, and that sections of the river that they used are going to have to be closed once again.
FROSCHSo you -- at some level, you have a community that's been traumatized by the spill, and two years later is dealing with it. In Mayflower, everything is much fresher, obviously. You have homes -- you have a street in a subdivision which is essentially completely deserted. And Exxon has agreed to buy out some of the homes in the subdivision and are doing what they can to essentially make things right for people who live there.
FROSCHBut obviously, living in a community and then being told, well, you know, you can move if you'd like and we're willing to buy your home is not an easy process. So their recovery is just beginning, but one can assume that it's going to be no less impactful.
REHMAre there lawsuits going on?
FROSCHYes. I mean we've seen lawsuits in both communities, and that's to be expected when there are major environmental disasters. And it's unclear where those lawsuits will go. I think, you know, one of the issues that we've seen both in Michigan and in Arkansas is that in both cases the pipeline companies will designate a specific area that they've deemed to have been most impacted by the spills, and they're willing to kind of buy out the homes within those areas.
FROSCHBut if somebody lives, you know, on the next block, they may not have the same financial assistance in place. So what you've seen in both cases are lawsuits coming from residents who live kind of outside of that designated area but near enough to where they are claiming that they too were impacted by the spills, whether it's their health, their livelihood or their property value. So we're seeing lawsuits in both situations coming from residents in those areas.
REHMDan Frosch of The New York Times. Turning to you, Andy Black, Dan talked about concerns even before the spills happened. In your view, what caused the pipes in Michigan and Arkansas to spew oil?
BLACKGood morning, Diane, and thank you. It's great to be here. Protecting people and the environment from releases of crude oil is very important. The pipeline industry wants to learn from any incident that happens. Michigan was found to be the cause of stress corrosion cracking, a unique combination of factors that occurred right there that Enbridge has learned from and has informed the rest of the industry about.
FROSCHThe situation in Michigan was made worse by delays in the control room that have now been improved upon by the entire industry by control room practices and new control room regulations. So when you get to the incident in Arkansas, you find that the company responded within minutes, and, as Dan said, it was a much lower volume of release.
FROSCHThe cause of the incident in Mayflower was found to be a manufacturing defect in the pipe from the mill that has not been found by prior tests to assess the line. It's part of the story of technology which is improved dramatically but needs to improve further so that we can identify features like that before they fail.
REHMBut if the accident in 2011 happened first, I mean, why didn't that technology get looked at again?
BLACKThe technology that is used to inspect pipelines is travels inside a pipeline, inline inspection. We call it in the industry smart pigs, and they're smart, but they're not smart enough. One vendor of this technology said that it catches maybe 90 percent, not 100 percent, of what's there. As Dan said, these are two very different releases.
BLACKThe incident in Arkansas could not be found using today's technology. So operators are trying to push the frontier further of what this technology can do. They're spending -- there's 20 billion -- $20 million of ongoing research right now to improve the technology of pipeline inspection devices.
REHMAndrew Black, he's president and CEO of the Association of Oil Pipe Lines. Turning to you, Anthony Swift, what about oil sands crude makes it so difficult to clean up after a spill?
SWIFTWell, thank you, Diane. Oil sands crude or tar sands crude is dramatically different from the conventional types of oil that have traveled on the pipeline system historically. It's a mixture of heavy bitumen mined out of the Alberta tar sands in northern Alberta, and heavy bitumen is this thick substance. It's actually heavier than water. And to get it to move in a pipe, it has to be mixed with volatile natural gas liquids.
SWIFTIn this mixture, called diluted bitumen, moves down pipelines usually at -- it's still very thick. It tends to move at higher temperatures because of frictional heating in the pipeline. And when it spills, particularly in water bodies, what EPA and spill responders in Kalamazoo found was the natural gas liquids gassed off, and that left the heavy bitumen to sink under the water body. When it hit the Kalamazoo River, conventional spill response measures were unable to contain the oil.
SWIFTAnd the striking thing about this is over three years after the Kalamazoo spill, industry -- neither industry nor regulators have evaluated how to deal with the tar sand spill that hits a water body. Recently, Trans-Canada admitted that tar sands crude is likelier to sink when it hits a water body, but we still don't have the answers for how to deal with this type of crude. And more to the point, it's not only different in how it spills, but it's also different in that in producing tar sands is significantly more damaging to the environment. It creates quite a bit more greenhouse gases.
REHMAnthony Swift, he's an attorney with the Natural Resources Defense Council. Short break here. Right back.
REHMAnd welcome back. Joining us now by phone from Little Rock is Arkansas Attorney General Dustin McDaniel. Good morning, sir. Thanks for joining us.
MR. DUSTIN MCDANIELGood morning.
REHMTalk about some of the issues people in Mayflower, Ark. are still facing as a result of the spill.
MCDANIELWell, a number of people are still displaced from their homes, and even though the EPA has indicated that they -- their properties meet minimum standards for re-occupation, moms and dads are not comfortable bringing their children home to a lot of these homes. And Exxon last month said they were going to, on Sept. 1, discontinue the support payments for people who were displaced.
MCDANIELAnd Congressman Tim Griffin and I -- bipartisan outraged to that decision, and so Exxon backed off. And then about a week ago, all right, on Sept. 12, we are now going to discontinue support for those folks. So there are a lot of people who have homes, their dream homes that they don't feel safe to re-enter and now are faced with a financial decision point that they don't have a choice. So on top of health issues and ongoing cleanup and property value diminution, you know, there's all kinds of concerns like that.
REHMWe did invite ExxonMobil to come on today's program. The company said no one was available and offered this statement, which reads, in part, "We truly regret the spill -- that the spill continues to impact the community and appreciate everyone's continued patience. We will remain here until the job is done, and we'll work to restore your community as quickly and as safely as possible." I understand, Dustin McDaniel, that Arkansas has now joined with the Justice Department to file a lawsuit. Tell us about that.
MCDANIELWell, the lawsuit that we filed is essentially enforcement of state and federal Clean Water and Clean Air Acts. They are penalty lawsuits. These are not lawsuits that represent the individual interest of homeowners or business owners, but rather impose penalties. For instance, in Arkansas, the penalties are $10,000 per day of violation for the air and water pollution and $25,000 per day per violation of the Hazardous Waste Act violation. But none of that relates to the actions that private citizens will have to bring through their own lawyers.
MCDANIELBut there's a lot of litigation from multiple fronts. Furthermore, it also doesn't include natural resource damages which are mainly vested with the Arkansas Game and Fish Commission which owns Lake Conway, which was the lake that received the oil as it drained downhill. So those natural resource damages will also be brought in its own action at some future point.
REHMTell me what you can estimate that the spill has cost the state of Arkansas.
MCDANIELTruthfully, I have no way to even estimate that at this point. We've had crews 24 hours a day, seven days a week since Good Friday in differing degrees there at the scene. Certainly, the impact to the natural resources, as I said earlier, will have to be assessed over time and a suit for recovering those natural resource damages would be brought.
MCDANIELAnd then, of course, the sense of being unsafe with regard to underground infrastructure because this very pipeline, which I assume that 900 miles of it came from the same factory and would have at least the risk of the same defects, it travels under the Arkansas River. It travels under Lake Maumelle, which is the water shed for the 400,000 people -- the drinking supply here in Little Rock.
MCDANIELAnd I think it crosses 27 other water sheds as it crosses the state of Arkansas, not counting what it's done elsewhere. So there are a lot of state and local officials all throughout Arkansas who are worried about the safety of their water supplies.
REHMSo how satisfied are you with the statement I just read -- pardon me -- from Exxon and what you have heard?
MCDANIELWell, I've been rather critical of Exxon throughout this process because I have recognized that despite their rhetoric of trying to help, they clearly couch it in very cautious terms that are designed to protect their legal positions. This is a small subdivision that has two categories of homes. I couldn't tell which guest mentioned that while I was on hold, but you have homes that were evacuated immediately, which was a snap decision by inexperienced state and local officials who didn't even know what they were dealing with.
MCDANIELSo they were trying to make the best decision that they could at the time, but it certainly wasn't intended to be a legal line of demarcation. In other words, if you were evacuated, your legal rights would be X, and if you lived across the street or next door to an evacuated home, your rights would be Y. Unfortunately, Exxon has treated it that way. So I've been very dissatisfied with the very harsh -- and I've even called it coldhearted at times -- litigation stances that they've taken with folks who did nothing but wake up on Good Friday and find an oil spill in their driveway.
REHMArkansas Atty. Gen. Dustin McDaniel, thank you for joining us.
MCDANIELThank you for having me.
REHMAnd turning to you now, Dan Frosch, what kind of oil would be transported through the Keystone XL pipeline if President Obama approves the project? How similar would it be to what spilled in Arkansas and Michigan?
FROSCHI think Anthony and Andy can speak to this in more detail, but it would be -- it would also be heavy Canadian crude that would be transported through Keystone XL, and that is where the concern lies with regards to these two spills, in particular the reference to the Michigan spill where we have found this sort of oil, this diluted bitumen, if you will, to be so difficult and so tricky to clean up. And whether it is exactly the same of batch of crude or not remains to be seen.
FROSCHBut I think what's most important is that it would be heavy Canadian crude from the same area of Canada that has already proved thorny and vexing to clean, particularly around environmentally delicate areas and around populated areas. And, you know, in terms of the exact batch, that's really kind of proprietary information that the company keeps close. But I think, you know, everyone agrees that it would be a very similar product.
REHMAnthony Swift, what are the major environmental concerns that you have about the XL pipeline?
SWIFTWell, to start with, tar sands is dramatically more carbon-intensive than conventional crude, so by -- the XL pipeline, by replacing conventional crude at the Gulf with tar sands, will significantly increase U.S. carbon emissions at a time we need to be going the other direction and reducing our carbon emissions. It makes the fight against climate change much more difficult. When it comes to the pipeline safety issues, we've found that pipelines moving diluted bitumen have had a number of serious problems.
SWIFTWe know that tar sands is harder to clean when it happens. And the XL pipeline would operate at 10 times the capacity of the Exxon pipeline that spilled in Arkansas. So when you have a problem, it will be significantly more difficult to deal with and of a larger magnitude. And I should note that we found that many of these problems are happening on new pipelines with special safety conditions.
SWIFTTransCanada's first tar sands pipeline, the Keystone 1 pipeline, spilled 14 times in its first year in the U.S. and actually had to be shut down by federal regulators. Its other recently built pipeline also had special safety conditions, the Bison natural gas pipeline, and it exploded. So we're finding -- that was in 2011. We're finding that we're having issues with aging pipeline infrastructure and with new pipelines.
REHMTell me, Andy Black, about the integrity management regulations. What are they? What do they do?
BLACKThe federal safety regulator of pipelines is the Department of Transportation. It's the Pipeline and Hazardous Materials Safety Administration, PHMSA, and they oversee a rigorous code of pipeline integrity management. Pipeline operators spent $1.1 billion just last year on pipeline integrity, and that's evaluating, inspecting and maintaining pipeline to continue improvements in the pipeline safety record. Pipeline safety is up 60 percent from 12 years ago when these integrity management rules came into focus.
BLACKAnd pipelines built today, like Keystone XL, are using modern construction techniques, modern steel, modern coatings. And during Keystone XL's first several days, it passed a hydrostatic pressure test that is intended to find out if there are construction or manufacturing defects. It has passed the test of how is the pipeline done along the right of way? There have been no integrity failures. What it did not pass were whether valves and fittings were perfect.
BLACKWe had very small releases contained on company property, except for one issue in North Dakota a very small release that was contained or remediated. That's what pipeline -- that's what happened in TransCanada Keystone. The State Department concluded that Keystone XL will be the safest pipeline ever built. And I agree.
REHMAnd here's the question I have with all the improvements that you talk about in safety since 2001. How do you account for the Michigan spill that happened in 2010 and the Arkansas spill, which happened this past March?
BLACKWe don't want any pipeline incidents to happen.
REHMI understand that. But how do you account...
BLACKAnd they are frustrating.
REHMHow do you account for these big spills when you talk about the improvements in safety since 2001?
BLACKTheir liability record is now 99.9995 percent safer than ever before and safer than any competing mode of transportation, but it's not 100 percent. And we have a lot of programs and are spending a lot of money to try to get there to where there no incidents. These are rare incidents that we learn from them.
REHMAndrew Black. He is president and CEO of the Association of Oil Pipe Lines, and you're listening to "The Diane Rehm Show." Anthony Swift, can you estimate how many significant oil pipeline leaks we've had in the U.S. in recent years?
SWIFTIf you look at the Pipeline and Hazardous Materials Safety Administration data, we have around 350 to 360 a year, so these are actually relatively common. The Wall Street Journal just yesterday reported that pipeline spills are up by 77 percent this year. We -- if you look at moving averages, our pipeline system is spilling more oil over the last five years than it did over its 10-year average. And we're looking at, you know, yearly spill rates of somewhere in the excess of 100,000 barrels. That's over four million gallons a year. So we do have a significant issue with our safety system.
SWIFTAnd I would also say with the Enbridge spill, you know, and with the Exxon spill, we're finding that many of the safeguards that are on the books aren't working in the field. The National Transportation Safety Bill -- Board when it was investigating Enbridge, found that the company had many of the same mistakes in many similar releases in previous years in Canada and the United States, and they hadn't learn from them.
REHMAll right. We're going to open the phones and take our first call from Harbor Springs, Mich. William, you're on the air.
WILLIAMGood morning, Diane. Thank you for being who you are. I really appreciate the way you conduct your conversations and control everything.
WILLIAMI live in Harbor Springs, Mich. near the Straits, and there's a large pipeline that's going -- that has gone under the straits of Michigan. And they want to put crude through that pipeline. Now, the pipeline is 60 years old. I know that in order to get the pipe -- the oil through that pipeline, it's got to be -- it's got to have added chemicals to it. And those chemicals, some of them are dangerous.
WILLIAMThe pet coke problem is a very serious problem. If you look at some of the pictures from downstate -- around Detroit with the pet coke, that's the residual from that pipeline. There's also another pipeline that goes under the area between Sarnia and Port Huron. That's probably the one that spilled the mess in Marshall, Mich.
REHMAll right. All right. And, Andrew Black, a 60-year-old pipeline may not engender a great deal of confidence on the part of Michigan residents.
BLACKThe National Transportation Safety Board investigates pipeline accidents and makes recommendations that the industry take seriously. She was asked about the age of pipelines, and she said that if a pipeline is inspected properly and maintained properly, its age is not a critical factor. I used the example of the Golden Gate Bridge opened in 1937, very well maintained. And today, tens of thousands of cars pass over each day.
BLACKOur nation has older pipelines that are critical in bringing crude oil and gasoline to communities. We can count on those. They are under the supervision of the federal safety regulator and they are part of those safety improvements that we're finding the 60 percent of improvement in pipeline safety over the last 12 years includes them.
SWIFTWell, we found that older pipelines are at higher risk of spills are built with materials in many cases that are more likely to crack and rupture. And the idea that….
REHMDo we know the age of the pipeline that burst in Michigan?
SWIFTI believe the pipeline in Michigan was built in 1968.
SWIFTSo it was about 50 years old.
SWIFTAnd we're finding that our aging pipelines are being used to move increasingly hazardous forms of oil, and there's no abandonment plan for them. We have no plan for putting them out of services. At the same time, we're finding that our inspection tools are not adequate to determining whether they're...
REHMWhy not? Why not?
SWIFTWell, in many cases, you know, regulations don't require performance standards for these things, and to some extent, the technology isn't there yet. And what is happening is our operators are kind of pushing the envelope.
REHMAnthony Swift of the Natural Resources Defense Council. More of your calls when we come back.
REHMAnd now, joining us from -- by phone from Minot, N.D., Rich Adams of Enbridge Energy. He is senior vice president for operations.
MR. RICHARD ADAMSGood morning, Diane.
REHMMr. Adams, it's good to have you. Thank you. Tells us what Enbridge has actually done to help the communities affected by your company's oil spill.
ADAMSYeah, we've done a lot in the communities, especially in Michigan. We've had a presence there for some 50 years. And we have people that live and work in that community, and we're certainly concerned with the impact of the spill that we did have there. We did have a home bio program that was for a certain area of the community, and we've executed that.
ADAMSWe are seeing that some of those homes are actually selling, and we do have people moving back into the community. We certainly do have a number in the community who are unhappy with Enbridge, but I think, on the other side, we have just as many or perhaps more that are quite happy with the way we try to manage the mistake that we had there in Michigan.
REHMTell me where you are now in the cleanup process.
ADAMSYes. Currently, we are working with the EPA to do some additional dredging. This dredging is being done to remove residual oil. This is -- would be considered suspended oil in the system. That removal will require excavations in five different areas. We started that excavation actually -- or that dredging last week and that will continue likely through December. Really what's being removed at this point, as I said, is residual oil.
ADAMSTo characterize what we have there, it's almost the size of PepperPlex. And this is in certain concentrated areas where there's deposition points in the river, and that's what we're going in there to remove. Again, this not a product that represents a public health issue. At this point, the issue is -- this will come to the top during certain weather conditions and cause a sheen, and that's why we're removing that residual product.
REHMSo how much oil is going to remain at the bottom of the Kalamazoo after all the dredging is done?
ADAMSYes. We are working with the EPA to try to characterize the amount that will be left. The EPA did represent somewhere in the area of 100,000 gallons of oil possibly left. We don't agree with that and we're certainly working through the protocols from a scientific perspective to take a look at that. What we are finding is the amount of Enbridge oil that will be left in the system will, in fact, probably be much less than residual oil from previous contamination from urban environment over the last 50 to 100 years.
REHMAll right. Here in the studio is Anthony Swift. I wonder if you'd comment.
SWIFTWell, EPA says that there are about 180,000 gallons of submerged oil still in about 40 miles of the Kalamazoo River. And I just recall, in 2012, when Enbridge declared the cleanup was over and EPA then sent Enbridge a notice saying there's far too much submerged oil to declare victory and, in fact, new areas of the river are in danger of contamination and the EPA then required Enbridge to go back to the drawing board and start to recover some of the submerged oil.
SWIFTSo there may be different ideas of what the natural state of the river is but, you know, and no colleagues of mine, they have recently travelled down the Kalamazoo River and they find or they have reported significant areas where submerged oil does come up into an oily sheen. And that means it is mobile, it is getting into the environment. And the long-term health impacts of that, both from public health perspectives and from environmental perspectives, are unknown, but it's not helpful. That's for sure.
REHMIf that oil...
REHM...had been there before, wouldn't the community have seen it?
SWIFTIt's very likely, yes. And as many companies pointed out, conventional oil doesn't tend to sink. It's generally the heavy tar sands that does. So the fact that there's significant submerged oil, the idea that it's conventional gasoline, is very unlikely.
REHMSo, Rich Adams, when you say you got difference of opinion with the EPA, and the EPA says that is your tar sands oil, what are you going to do about it?
ADAMSWell, I'm certainly not refuting that we do have Line 6 oil in that system and we are working with the EPA to remove that. We're doing -- we're complying with all the orders the EPA has given us. I do want to respond to Mr. Swift's comments. Not once has Enbridge declared the cleanup over. We have said from the beginning, we will be there for 10 years or 20 years or however long it will take our pipelines will be in that community. And I'm not sure where he gets the information that we've said we've declared this is over 'cause we just, in fact, have not done that.
ADAMSAlso, in terms of the characterization of oil sands crude, in fact, the oil sands crude, before it's put in our pipe, will float on water, and when it comes out of the pipe, it will float on water. What happens to all heavy crudes is with weathering and mixture, with dirt and sand and silt over time, it will settle. And that is a problem, and we have to react and cleanup such crudes in very rapid order to make sure that doesn't happen.
REHMAll right. Let me ask you, you say those pipelines are going to remain in that community, what actions have you taken to ensure that yet another spill does not occur?
ADAMSWe've applied a lot of technology through our entire system and really increased the -- our budgets related to maintenance of pipelines. In addition, we're actually replacing Line 6B. We've been in that process now for really over the last year and a half to two years, and that entire pipeline will be replaced with a new pipeline through that area.
REHMRich Adams of Enbridge Energy, thanks for joining us.
REHMAnd now joining us is Arkansas Republican Congressman Tim Griffin. Good morning to you, sir.
REP. TIM GRIFFINGood morning. Thank you for having me.
REHMSure. Go right ahead. I know you want to say something.
GRIFFINWell, I would just emphasize -- I haven't heard anyone discuss this yet. I want to emphasize that the next battle for us in Arkansas is figuring out how we get Exxon to move the pipeline that extends beyond Mayflower to the South and goes by a very sensitive -- goes through a very sensitive watershed.
GRIFFINWe -- a lot of stakeholders in Arkansas have asked Exxon to move the pipeline and, of course, the pipeline that spilled -- the Pegasus pipeline that spilled in the Mayflower is not operational now, but it goes right through the watershed near what's called Lake Maumelle outside Little Rock that provides breaking water for about 400,000 Central Arkansans.
GRIFFINAnd the issue -- one of the big issues there is obviously our breaking water is critical but also the topography of the land surrounding Lake Maumelle is very hilly, not quite the size of mountains but significant hills. And if there were to be -- if there was to be some sort of spill like in Mayflower, it would be almost impossible to keep the oil from, very quickly, getting into Lake Maumelle and the watershed more broadly. And so...
REHMAll right. And let's turn now to Andrew Black and get him to respond. He is president and CEO of the Association of Oil Pipe Lines.
BLACKProtecting Lake Maumelle in Arkansas or any other waterway along the right of way is important. And, in fact, the regulations on Pipeline Integrity Management require that additional protection be given to those areas. The Pegasus pipeline is down, as the congressman said, and it will not be restarted until the company is confident that it can be restarted safely and until the Pipeline and Hazardous Materials Safety Administration reports that it can be operated safely.
BLACKThere's an idea that a 60-year-old pipeline should be move. A rule of thumb on building a new pipeline is two and half to $3 million per mile. Not a practical suggestion as I understand it. In Arkansas, that would be perhaps hundreds of billions of dollars when it's not necessary to protect Lake Maumelle and everyone else. The company needs to do the inspections and the repairs necessary to know that they can operate safely and the federal regulator will not let it open until they're convinced as well.
REHMAnthony Swift, do you want to comment?
SWIFTWell, we know from the inline inspection data of that pipeline that there are numerous cracks and areas of concern. And we also know -- and again, this -- The Wall Street Journal on this yesterday, that the SmartPay technology is not particularly effective at dealing with -- identifying these cracks. So I think that we do need to take seriously the question of pipeline sighting, where they're located, what they risk. And that's a case with both old pipelines and new pipelines. If you can't afford this bill into place, you can't have a pipeline to be there.
REHM...I want to thank you for joining us today.
GRIFFINShould I make for one more thing?
REHMVery briefly, sir.
GRIFFINYeah. One of the things I would point is Exxon on -- one of Exxon's own executives suggested this past week that they may not restore this pipeline ever, that it would, in fact, be replaced. So Exxon has suggested that themselves, and I'm going to -- I'm going to continue that conversation with them.
REHMI'm glad. Thanks for calling in, sir, Arkansas Republican Congressman Tim Griffin. Dan Frosch, what do you know about all of this?
FROSCHWell, I think the conversation, as it should, is going to turn towards pipeline safety after these accidents. And it periodically does so, but then we tend to seem to forget about it. I mean, inspecting a pipeline is not easy. It's not like calling up an inspector to take a look at an elevator in an apartment building or something of that nature.
FROSCHWe're talking about pipelines that go for hundreds and hundreds of miles. So this is something that's time consuming, it's costly, and it's difficult. And so one of the aspects of this process that has been criticized in the wake of these spills is that too much of the inspection and regulatory control is left in the hands of the pipeline companies themselves.
FROSCHAnd, frankly, some of this criticism has come down on the federal regulators as well. So I think what we're seeing in the wake of these spills is a sense that perhaps these companies, Exxon and Enbridge and other pipeline operators, should not be given so much discretion with regards to creating these integrity management plans, which essentially leave a considerable amount of control in their hands in terms of inspecting their own pipelines. And I think that's a debate that we're going to see amplified as we move closer to a decision on Keystone XL. And I think that's a good thing.
REHMAll right. To Lebanon, Ky. Hi there, Mary. Mary, you're on the air. Go right ahead.
MARYDiane, I like you so much.
MARYI never called before. I have a farm in central Kentucky. Bluegrass Pipeline, is that the same as what we're talking about there?
BLACKNo. Bluegrass Pipeline is a proposal for a natural gas pipeline, a natural gas liquids pipeline that we...
MARYNo. I know it's liquid. It's going to get processed when it gets down to Mississippi.
BLACKYes. And it, too, will be under the Pipeline and Hazardous Materials Safety Administration for regulation.
REHMSo we hope that those federal rules gets stronger?
SWIFTNo. That's true. And I will say we're finding many gaps in them. And one of Dan did mentioned that operators are giving great discretion in ensuring the safeties of their system, and we find that oftentimes they push the envelope quite a bit farther than the safety would allow.
REHMAnd you're listening to "The Diane Rehm Show." Let's go now to Norman, Okla. Carol, you're on the air.
CAROLThank you, thank you. I'm happy so to call this morning, but not one of your guests has mentioned the possibility of terrorist and sabotage on the incredible leak of this pipeline. And it's obvious vulnerability.
FROSCHYou know, that was mentioned -- that scenario was certainly mentioned in various federal reports on the pipeline. But as I understand it, it was not seen as something that folks should be terribly concerned about. But clearly, you know, that we've seen this sort of behavior in other countries. But I think the hope is that this is, you know, we're going to be talking about spills, not terrorist attacks.
REHMAll right. And one last caller from Ann Arbor, Mich. Beth, you're on the air.
BETHThank you so much for having me on. I want to agree completely with what Dan just said about integrity management being completely done by the operators. It needs to be revamp, and we really need to be looking at that piece of pipeline regulation. But that's not my question. My question is more geared towards Enbridge. And I'm not sure if that they're on the line still but...
BETH...what we saw with Edwards bill is that Enbridge took advantage of that situation and has now utilized the system to do a complete overhaul or expansion within the lake -- Great Lakes. They're expanding pipelines all across the Midwest and the Great Lakes, some of which will be transporting more crude than what it's like for Keystone XL. And they have done so by taking advantage of huge gaps and regulation and kind of bypass presidential permits, and they've left it up to states to decide.
BETHSo this completely angered a lot of the people within the community, especially this bill community. And I should say that I am from this bill community, one of them. And what's really disheartening to hear Enbridge talk about this bill in that way because that's, you know, how people see it and now they're dealing with into pipeline replacement in that location. And so many people, in fact, my mom's neighbor -- my mom and dad's neighbor is dealing with the pipeline -- replacing of lines being -- it's been a tragic situation, top to bottom.
REHMAll right. Last word, Andy Black.
BLACKEnbridge reviewed the line 6B and conclude it should be replaced. They believe that that's the best thing for safety in what's being built today, we'll be a better pipeline. The National Transportation Safety Board recommended after Enbridge that the entire industry work on a safety management system to continue to track improvements and build into out to the company. The industry has embraced that. It's working with safety experts and federal regulators. And that's going to be another aspect of improving safety operations.
REHMAnd finally to you, Anthony Swift.
SWIFTWe've seen serious gaps in the safety of our pipeline system, particularly as it pertains to tar sands increasing volumes on our pipeline system. And other things to keep in mind in finally is the pipeline safety issues associated with it mirror the climate impacts associated with tar sands. So it's really a question of what kind of energy system we want.
REHMAnthony Swift, Andrew Black, Dan Frosch, thank you all so much. We'll watch this situation as it unfolds. Thanks for listening. I'm Diane Rehm.
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