It might surprise many to learn that America's largest oil supplier is not in the Middle East. It's actually Canada, which supplies the U.S. with more than two million barrels of oil a day. Besides strong cultural ties to Canada and a 1,500-mile border, the two neighbours do more than $1.5-billion worth of trade every day.
Critical decisions about North American energy security are before us right now, and every extra day of indecision weakens us. Instability in the Middle East has demonstrated how America's reliance on oil from unstable regions is a threat to its economic and national security.
A major spike in oil prices is now retarding America's economic recovery. A tide of populist frustration across the Middle East could put groups implacably hostile to the West in control of immense supplies of oil. That's why the vast, stable supplies of oil in Canada are more important to the future of U.S. energy security than ever before.
Canada already provides America with more than 20 per cent of the 11 million barrels it imports each day, but for the U.S. to fully take advantage of Canada's resources, a better supply network needs to be in place. The proposed Keystone XL pipeline project would move oil from the U.S. and Alberta to Texas with connections to a network of U.S. pipelines and refineries. This pipeline has the potential to supply America with an additional 1.1 million barrels of oil every day.
That's 1.1 million barrels of oil that wouldn't need to be imported from hostile regions in the Middle East and South America. Unfortunately, this project has been lingering under review by the U.S. State Department since 2008. Despite a thorough environmental review that found the project should move forward, the Obama administration has announced another round of environmental studies. This further delay will prolong America's dependence on unstable sources of oil and postpone the creation of badly needed jobs.
Many of the special interest groups opposed to the Keystone XL pipeline are really seeking to attack Canadian oil sands development. There's no question that everyone on both sides of the border should expect the highest standards in the extraction and transport of Canadian oil. But these groups are propagating the fallacy that, if America refuses Canadian oil, it will stay in the ground. In fact, alternate markets exist and are growing. There are at least two major projects under way to transport Albertan oil to the Pacific to supply that demand.
The question is not whether Canadian oil sands should be used - they will be. The question is whether the U.S. will seize the opportunity to benefit from Canada's abundant supply, which is comparable in size to Saudi Arabia's resources, yet located only 600 miles from the U.S. border.
Canada has already made remarkable progress in reducing the environmental footprint from oil sands development. In the oil sands, more than 80 per cent of water used by industry is recycled. The first tailing ponds are being reclaimed as green land and replanted with hundreds of thousands of shrubs and trees.
From an environmental standpoint, pipelines are the safest way to carry crude oil and petroleum products. The Keystone XL pipeline will employ state-of-the-art monitoring systems using satellite technology and 16,000 data points to ensure the utmost safety in transporting oil from Canada to the U.S. By partnering with Canada, the U.S. can ensure that strict environmental standards are being met from start to finish.
We also shouldn't ignore the economic implications of the Keystone XL pipeline. Building the pipeline will create more than 20,000 new American jobs in construction and manufacturing in the short term, adding more than $6-billion in personal income to those workers. In addition, more than 250,000 jobs will be created in the long term. The pipeline would also generate needed revenue for states and local communities, including $585-million in taxes and more than $5-billion in property taxes over the pipeline's operating life.
The Keystone XL pipeline is a win-win for the U.S. and Canada. Canada will gain a stable market with steady demand, and the U.S. will improve its energy and economic security. It's part of a broader strategy that's in both of our nations' interests. The time has come to reduce dependence on oil from hostile regimes, and put people to work.
Thomas Donohue is president and CEO of the U.S. Chamber of Commerce. Perrin Beatty is president and CEO of the Canadian Chamber of Commerce.