Most of the critics posting comments missed the obvious point concerning the crude oil issue. The product intended to be transported from Canada through the pipeline is tar liberated from tar bearing sand located in Canada. The tar sand project was purchased by and belongs to the Chinese. They paid good money and own 100% of the project.
When the tar is liberated from the ground, it is extra sour, long on sulphur, thus very corrosive, and long on sand, thus very abrasive. Corrosive and abrasive products will quickly eat through the best metal known to man. After the Chinese sour sandy tar is pumped through thousands of miles of pipeline, it will be delivered to Velero refineries located on the Texas Gulf Coast. The sandy tar product will be refined into diesel, jet fuel and heavier petroleum by products. Valero, in its role as a contract refiner will deliver the refined products to the Chinese designated end users. The products are not intended to be sold on the U.S. market.
Where is the benefit to the U.S.? Valero refineries are located on tax free real estate. The Chinese keep ownership of their corrosive tar sand from the mine in Canada, don’t sell it to Valero, in Texas, thus, they don’t pay taxes for transportation or refining until they use it in Asia or some off shore location. The U.S. and the States do not charge a value added tax. We charge sales tax. No tax charge to the manufacturer.
As long as the Canadians and the U.S. do not allow a pipeline, the corrosive tar sand costs too much for the Chinese to transport by truck. The specialized refineries, that can refine sour crude, are located on the Gulf Coast, not on the West Coast of Canada.
Why do we need to allow the Chinese to build a pipeline through the U.S. so that the refineries on the Gulf Coast can refine the Chinese fuel, so that the Chinese economy can benefit? How will the Canadians benefit from the Chinese mining the Chinese tar sand for use as a fuel in Asia? How will the Canadians collect a value added tax to the Chinese tar sand?
The U.S. and Canada are thinking like third world countries. Third world countries sell their natural resources so that the manufactured goods and refined natural resources ultimately are sold where the economies of first world nations get the most value out of the refined resource.
Obviously, the diesel produced from the Chinese tar sands, will be of greater political value to the customers of the Chinese Petroleum Company that are not located in the U.S. or Canada.
How does it benefit the interests of the people of the U.S. to make diesel fuel cheaper to the Chinese than the people of the U.S.
