The energy industry payback is difficult to fight. With the US as a major producer of climate change due to carbon fuels it's imperative to put public policy measures into place that deal with this. The Keystone project has become the focus in the battle between the public and the oil industry profits. There is no free enterprise in oil, the US doesn't benefit; it is traded on the international market. All the world's oil and gas are tied up by multi-national corporations. The embedded profit in oil and gas distribution and refining mean that no matter how much is extracted, the price of oil would not go down, it's controlled by a market structure. This market structure will direct income whichever way it is necessary to get its projects put through, hence the influence in government approvals. This is playing out now in the US, with the ratcheting up of domestic oil and gas production as has been touted by the Obama administration.
The realities of this market have been pointed out by Bill McKibben's "do the math" approach that talks about the profits embedded in oil and gas that have not yet been extracted. If you look at how the market is structured and how the industrial players are mapping out their oil development strategies, it's apparent that the industry profit formulas and the way that royalties are distributed are key to the financial health of many governments and companies in North America.
Take a look at how oil and gas exploration and extraction are analyzed for production in the US. The map here (pdf file) is very interesting, it shows key onshore crude oil production basins and their potential for producing oil starting in 2014. It makes note of the maturing existing fields, and the new extraction from areas that have not been under energy production yet:
EIA estimates that total U.S. oil production will increase from 6.89 million bbl/d in November 2012 to 8.15 million bbl/d in December 2014 (Figure 2). In the Lower 48 states, excluding the Gulf of Mexico Federal Offshore region (Federal GOM), production is forecast to rise from 4.97 million bbl/d to 6.10 million bbl/d over the same period, representing most of the increase in U.S. oil production. Oil production from offshore fields is expected to resume an upward trajectory as operators intensify exploration and development efforts in the deepwater portions of the Federal GOM. Federal GOM production increases from 1.37 million bbl/d in November 2012 to 1.55 million bbl/d in December 2014. At the same time, EIA expects that the contribution from Alaska and other mature onshore areas in the Lower 48 states will continue to wane over the next two years.
So, as it has already been pointed out, the emissions from the US will only increase due to oil and gas production, yet the financial benefit will go to the multinational companies that are doing the extraction and refining. Once again, privatize the profits, push the damage into the public sector. Somehow this industry cycle must be broken through public policy and financial tax disincentives, which the US has not yet had the resolve to do. Even the "peak oil" phenomenon has not encouraged a shift to renewable energy sources yet, exploration and expensive extraction still create profit in this market. It's time to support an aggressive market restructuring that favors renewable and non-carbon sources that will do far more to change the game than all the political protests could achieve, which is the Al Gore approach.
It remains to be seen whether this will make a difference in the world's energy picture, and thus the salvaging of planetary resources and natural processes.
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