Recognizing the environmental risk and potential revenue opportunity of the looming Dakota Access Pipeline, Senator Jason Frerichs (D-1/Wilmot) and Rep. Paula Hawks (D-9/Hartford) have offered Senate Bill 146, which would tax crude oil flowing through our state at two cents per barrel. SB 146 would put pipeline tax proceeds in a special fund dedicated to cleaning up any pipeline boo-boos for which the leaky pipeliners themselves fail to take responsibility. Pipeline clean-up funds would have to be authorized by the Legislature. SB 146 stops collecting the pipeline tax if the clean-up fund accumulates $30 million and doesn’t start collecting the tax again unless the fund is drained to less than $5 million.
According to figures I used last fall, max out capacity on Keystone I and Dakota Access, and South Dakota could raise $8.5 million a year. So really, pipeliners, you could pay this tax for less than four years, and then as long as you don’t blow a gasket and leave a mess that you don’t clean up yourselves, you won’t have to pay that tax ever again! Sounds like a small investment to make in the privilege of shipping your profitable crude under our sensitive soil, don’t you think?
There are questions about the constitutionality of imposing a tax on oil moving across state lines. But hey, if Republican legislators don’t care about violating the Constitution to harass innocent refugees, why should they mind violating the Constitution to hold oil pipeliners accountable for their errors?
Also questionable is whether SB 146 would tax pipeliners enough to hold them accountable for a major pipeline break. Cleaning up the tar sands pipeline spill in the Kalamazoo River in 2010 cost $765 million, 25 times more than SB 146 sets as the maximum amount for the pipeline clean-up fund.
But proving that Republicans are still drunk on oil, 32 House Republicans and 11 Senate Republicans are sponsoring House Concurrent Resolution 1008, calling on Congress and the U.S. Secretary of State to resurrect the dead Keystone XL tar sands pipeline. Never mind that President Obama, innovation, and market forces have killed Keystone XL. This resolution is so outdated, it even relies on the long-disproven lie that Keystone XL would have created 120,000 jobs.
But if by some miracle this timewasting resolution actually brought Keystone XL to fruition, we might need that clean-up tax from SB 146. Canada’s pipeline regulator says Keystone XL builder TransCanada’s use of shoddy materials led to a natural gas pipeline explosion in Alberta in 2013:
TransCanada Corp put “substandard materials” – made by Quebec manufacturing company, Ezeflow – in an Alberta natural gas pipeline that blew up in 2013, Canada’s pipeline regulator said on Friday as it finally responded to a four-year old warning from a whistleblower with a new industry-wide safety order.
The order gives all Canadian pipeline companies under federal jurisdiction 60 days to identify whether any of their pipelines are using specific types of pipeline fittings, made by Ezeflow in Quebec as well as fittings by Canadoil Asia produced in Thailand, that were flagged for safety reasons. The order also requires the companies to submit mitigation plans to address potential weaknesses.
With the order, the regulator, the Calgary-based National Energy Board, confirmed that the whistleblower, former TransCanada engineer Evan Vokes, had correctly identified a safety issue that contributed to a rupture within a few hundred metres of a hunting cabin owned by a Cree family in northern Alberta [MIke DeSouza, “TransCanada Dismissed Whistleblower. Then Their Pipeline Blew Up,” National Observer, 2016.02.05].
Republicans would give careless corporations like TransCanada a free pass to put South Dakota risk for private profit. Democrats at least ask that we make pipeliners pay for the risk to which they subject us.
GOP party: privatizing profits and socializing risks for over 150 years.
Yes, and especially since our dear Kristi Noem voted “No” on the Oil Spill Liability Trust Fund. (last year sometime, if memory serves)
Procrastinate. Ain’t it great? TC could have undertaken this safety stuff a few years ago when they were profitable and better able to stand a financial setback. Now,I suppose,they will throw themselves on the mercy of wingnuts and beg to be let off the hook because dilbit is too expensive to mine with oil prices failing.
South Dakota opponents of the Keystone XL refer to it as the Zombie Pipeline. The pipeline that refuses to die, it just keeps resurfacing. HCR 1008 is just another indication that our legislators don’t want to tackle the tough problems.
What price do you put on the land and water of South Dakota?
Remember, “Cleaning up the tar sands pipeline spill in the Kalamazoo River in 2010 cost $765 million, 25 times more than SB 146 sets as the maximum amount for the pipeline clean-up fund.”. There is still tar sands oil in the bottom of the Kalamazoo River and the Gulf is still recovering from the Deepwater Horizon catastrophe. See http://news.wgcu.org/post/gulf-oil-spill-conference-held-tampa for the latest news on that (2/4/2016).
Same bill Sen Maher ran and others brought back for five years plus or minus. 30 Mil is a respectable number for Hading County not sitting atop of a precious large water source such as the Ogalala. It is nothing short of laughable anywhere near our waters of quantity.
The XL pipe came from India as I remember.
Pretty much the same bill Les. Senator Frerichs is a good man to sponsor this bill. A real believer in property rights. I would like to see him as governor some day.
Les, TransCanada said that 74% of the Keystone XL pipe would be manufactured in North America. 50% would come from the Welspun plant in Arkansas. That’s an Indian company which would manufacture another 10% back in India. TransCanada bought steel for Keystone 1 from Welspun, which produced lots of substandard pipe joints in 2007 and 2008.
Paul, the $100,000 Question is, would Jason Frerichs like to see Jason Frerichs as governor some day?