Big Banks Admit No Keystone XL, Limited Expansion of Tar Sands Development
Want to know how the Keystone XL will drive up climate emissions? Just ask the banks that are needed to fund dirty tar sands pipeline projects and they'll tell you straight out: no KXL means no substantive development of the tar sands, one of the world's largest pools of carbon and a sure-fire way to cook the planet.
Both TD Economics and CIBC have recently said that without added capacity, "Canada's oil industry is facing a serious challenge to its long-term growth" and that “Canada needs pipe — and lots of it — to avoid the opportunity cost of stranding over a million barrels a day of potential crude oil growth.”
Remember that "Milkshake" scene in "There Will be Blood"--the one in which Daniel Day Lewis says "I drink your milkshake?" to a despondent Paul Dano? KXL would operate in a similar way. The KXL straw is so long and so big that it's needed to start to drain the tar sands. Without that long straw, the banks warn, the tar sands crude would stay in the ground. If you care about species extinction, sea level rise, and leaving behind a planet for our kids that's sort of the like the one we live on now, that's a good thing.
The tar sands have about half--half!--the carbon that we can burn if we are going to avoid runaway climate change. The banks say there are four options to expand the market reach of Canadian crude: out through Canada's Western Coast, the U.S. Gulf Coast (KXL), Quebec, and Atlantic Canada. But the industry knows that it faces huge opposition if it wants to go west or east, so it's banking on the south.
That's why Keystone XL is so important to the industry, and that's why it needs to be stopped. The pundits and industry will tell you this oil is coming out one way or another. But the big banks don't agree. So let's listen to the banks, at least on this one, and leave it in the ground.