What's the difference between an oil spill from a pipeline and an oil spill from a train? Answer: A lesson in political opportunism.
The media have played up Friday's discovery of an oil leak in an old Exxon XOM -0.38%Mobil pipeline near Mayflower, Arkansas. It isn't clear how much oil escaped from the 850-mile Pegasus pipeline, but Exxon says it responded with teams and equipment able to handle as much as 10,000 barrels and that by early Saturday it had stopped the flow and begun cleanup.
The real reason for the headlines is that Pegasus was delivering heavy crude from the Canadian oil sands to Texas. This is similar to the oil the proposed Keystone XL pipeline would deliver from Canada to the Gulf Coast, and the anti-Keystone capos are using the Exxon spill to scare up political opposition to the new pipeline.
Massachusetts Congressman Ed Markey rewrote a familiar press release, and Sierra Club Executive Director Michael Brune said "this latest toxic mess" proves that "it's not a matter of if spills will occur on dangerous pipelines like Keystone XL, but rather, when."
All of this is in marked contrast to the non-reaction last week when a Canadian Pacific Railway CP.T -2.73%train carrying crude to Chicago derailed in western Minnesota, spilling about 15,000 gallons. Much of the press also ignored the train accident, though the spill was certainly serious and also took place near a town.
The train wreck illustrates one economic reality of the U.S. shale drilling boom, which is that energy companies have turned to shipping by rail as pipeline capacity has been filled. The volume of oil transported by U.S. rail has surged to 233,811 carloads in 2012 from 9,500 as recently as 2008. This means boom times for freight rail lines, including Burlington Northern Santa Fe, which is owned by Warren Buffett and Berkshire Hathaway BRKB -0.75%.
Rail is not the safest way to transport oil, however. Journal reporters recently analyzed federal data and found that railroad-related oil incidents are soaring, with 112 oil spills reported from 2010 to 2012 compared to 10 in the previous three years. The spills are small compared to the volumes that trains are carrying, and railways are essential in areas that aren't connected to pipelines.
By contrast, oil pipelines carry far more crude and have fewer leaks per mile. They also present fewer safety risks than the 2008 explosions when Burlington Northern Santa Fe oil cars caught fire in Oklahoma, requiring evacuations. "Railroads travel through population centers. The safest form of transport for this type of product is a pipeline," former Clinton National Transportation Safety Board Chairman Jim Hall told Reuters after the Minnesota accident.
The greens are flogging claims that Canada's oil-sands crude is more corrosive to pipelines than is other oil, and that this makes the Pegasus leak (and future Keystone leaks) inevitable. Oil experts refute that claim. In any case Pegasus was built in the 1940s, and about half of America's 2.3 million miles of pipeline were built more than 40 years ago. The best way to minimize leaks is to replace this aging network with modern pipelines such as the one planned for the Keystone XL, which use technology that instantly recognizes leaks and immediately shuts down oil flow.
No form of energy production or transport is without risks, so the issue is how to do it as safely and efficiently as possible. Canada and North Dakota are going to keep producing oil as long as America and the world keep using it, which is likely to be many decades. The tale of these two oil spills is one more argument to build the Keystone XL.
Correction: An earlier version misstated the number of gallons of oil spilled in the Canadian Pacific derailment.
