In recent years, the production of oil in the United States has grown remarkably, thanks in large part to development of the Bakken Formation in North Dakota – the second largest crude producing state in the U.S.
Although EIA expects U.S. crude oil production in 2016 to be lower than in 2015, U.S. domestic production of oil still remains substantial and there must be ways to move the product across the U.S. With global energy markets in excess supply, some of that oil is finding its way back to the US. Competitive U.S. domestic oil is key to reducing this dependence on foreign imports.
As critical as domestic oil production is, it is a stranded asset without the means to transport crude oil to end-markets. The Dakota Access Pipeline will do just that, carrying approximately 470,000 barrels per day from production areas in North Dakota to major refining markets and facilities efficiently and safely. The alternatives of rail and truck transport are far more expensive and risky to the environment than an oil pipeline.
Recently, the Dakota Access project has come under attack by the Standing Rock Sioux Tribe (SRST) and others protesting the project, with national groups who are known for opposing energy development latching onto the issue. While there have been peaceful demonstrations around the construction sites in North Dakota, recently some of these have turned violent.
On September 10, the Obama administration announced a pause in further construction near Lake Oahe North Dakota suspended pending further studies. This unprecedented move doesn’t just threaten the future of Dakota Access; it threatens future infrastructure projects as well.
The violent protests that preceded the September 10 pause, fly in the face of the thorough review process in the four states through which the pipeline will pass, resulting in the U.S. Army Corps of Engineers (USACE) approval of Dakota Access. USACE held dozens of meetings with the group. I understand that the Tribe declined to meet with Dakota Access officials as many as seven times.
Key findings from the USACE review process refute many arguments that the SRST has used to legitimize their protests. Dakota Access officials have surveyed the entire pipeline route on foot, met with local communities, and conducted numerous environmental and archaeological surveys to assess any potential impact construction may have.
While serving as ambassador to Azerbaijan in the mid-1990s, I was involved in negotiations regarding the development and export Azerbaijan’s oil resources.
It was a tumultuous time, as Azerbaijan emerged from the breakup of the Soviet Union and began to assert its national independence.
Moving that oil to world markets required crossing three state borders (Azerbaijan, Georgia and Turkey) with serious implications for the environment on shore and of the Black Sea as well as U.S. energy security interests. The choice was between shipping by existing rail links to Soviet-era export facilities, or building a new pipeline from Azerbaijan to Turkey via Georgia.
Emotions ran high as the many political, commercial and environmental issues were resolved and the decision made to build a pipeline – a pipeline that goes under rivers, across areas of contested ownership, and through regions of cultural and historical importance.
Over the past decade, the Baku-Tbilisi-Ceyhan (BTC) pipeline (with over twice the capacity of Dakota Access) has proven to be economically beneficial and environmentally safe. That, I believe, is what Dakota Access will prove to be as well.
Ultimately, the Dakota Access Pipeline stands to fill a critical gap in our nation’s infrastructure, advancing our energy security through the safe and efficient use of our domestic oil supplies.
Differences among the parties can be resolved (as they were with the BTC pipeline) as long as the basis for the differences is not whether fossil fuels have a future in the United States. They do.