The People of America's Oil and Natural Gas Indusry

API Files Petition in Oil Sands Case

Jane Van Ryan

Jane Van Ryan
Posted September 30, 2010

API and two other groups yesterday filed an amicus brief in federal court in a case challenging the U.S. Defense Department's use of fuels derived from Canadian oil-sands oil.

API, the National Petrochemical and Refiners Association (NPRA), and the U.S. Chamber of Commerce are seeking to intervene in the suit filed in June by the Sierra Club and the Southern Alliance for Clean Energy alleging that the Pentagon is not complying with Section 526 of a 2007 energy law. Section 526 requires the agency not to acquire fuels derived from crude-oil sources with higher greenhouse gas emissions than fuels derived from conventional sources.

As we've reported on this blog, a study by IHS CERA determined that the "well-to-wheel" lifecycle greenhouse gas emissions from Canadian oil-sands oil are on par with those from conventional U.S. crude oils as well as oil from other countries, including Venezuela and Nigeria. Furthermore, it is impossible for the Pentagon to determine which fuels come from Canadian oil-sands oil, preventing it--or anyone else for that matter--from complying with Section 526.

Crude oils from several sources become mixed in pipelines when they are transported to refineries for processing into fuels and other products. There is no marker per se that differentiates one oil from another during the refining process. As a result, the fuel in a jet fighter could come from North Dakota, Canada, the Gulf of Mexico and the Gulf of Oman.

Most importantly, preventing the Pentagon from using Canadian crude oil would make the nation less secure. The United States imports about 2 million barrels of oil from our friendly neighbor to the North every day. "No oil source outside our own borders is more secure than Canada," says Bob Greco, API's downstream director.

Bob also says the development of Canadian oil sands creates jobs in the United States. Citing a study from the Canadian Energy Research Institute (CERI), Bob says, "Over the next five years, Canadian oil sands development could lead to an additional 343,000 U.S. jobs. These are jobs that our struggling economy could use."