Keystone XL Pipeline
Natalie Geiger
OMT 430
Dr. Jane Humble
April 23, 2012
1.0 Background
The Keystone 1 pipeline, the product of TransCanada Corporation, is the sister pipeline
to the proposed Keystone XL pipeline. This pipeline, just as XL would, carries “oil extracted
from oil tar sands in the Canadian province of Alberta to the United States” (Rosenthal, 2011).
Just one year after the Keystone 1 pipeline began operation in June 2010, “the United States
Department of Transportation ordered TransCanada to suspend operation” preventing them from
“restarting operations on their [pipeline] until the Pipelines and Hazardous Materials Safety
Administration is satisfied with the ongoing repairs and is confident that all immediate safety
concerns have been addressed” (Rosenthal, 2011). This suspension was ordered because of “two
incidents involving oil leaks from small-diameter pump-station pipe fittings” (Rosenthal, 2011).
These two spills were just precursors to the next ten spills reported from the Keystone 1 pipeline
(Keystone Pipeline Infographic: 'Built To Spill', 2011). The newly proposed Keystone XL
pipeline is being over-shadowed with large amounts of scrutiny, based on the history of the
Keystone 1 pipeline.
2.0 Discussion of Specific Situation
The XL pipeline is another product of TransCanada, and would span an incredible “1,179
mile distance, from Hardisty, Alberta” to the Gulf of Mexico in the United States, and would
cost about $7 billion dollars to build (Keystone XL Pipeline Project, 2012). One of the largest
concerns with the production of the Keystone XL pipeline is the fact that it would cross over a
large portion of the Ogallala Aquifer, which is “the largest source of freshwater in the United
States” (Keystone Pipeline Infographic: 'Built To Spill', 2011).
After seeing the Keystone 1 pipeline’s multiple spills, there is a lot of hesitancy with
allowing the Keystone XL pipeline to cross over the Ogallala Aquifer. Another reason that oil
spills seem eminent is that “TransCanada has been granted waivers that effectively allow it to
use thinner steel than would normally be required in the United States. The company’s pipelines
for this project are particularly vulnerable because the oil from tar sands is more corrosive than
conventional oil and is pumped under higher pressures and temperatures” (Rosenthal, 2011).
An additional issue that many landowners are unsatisfied with is that the TransCanada
Corporation would be utilizing eminent domain to build the pipeline through many privately
owned lands. TransCanada’s project representative for the Keystone XL pipeline claims that
“they’re allowed to use eminent domain to build across private property because the oil will end
up being available to the public” (Henry, 2012). Many of the private property owners have
agreed to the amount of money that TransCanada has offered them, but many others are taking
the issue to court. Although the idea of them winning a lawsuit against such a large company is
faint, the people are unsatisfied with, as Julia Trigg, a farmer in Lamar County, Texas states, a
“foreign company’s ability to come in and take your land, that’s a property rights issue. And it
doesn’t matter what political bent you are. Nobody - in Texas, especially - wants to be told
someone’s going to come in and take your land” (Henry, 2012).
Although the project has many opponents, there are many who wish to see the XL
pipeline built. TransCanada, the company that would be building the pipeline, claims several
benefits to the project that would overshadow any potential problems. The Perryman Group
concluded an independent economic study, and states “that the proposed pipeline project should
improve U.S. energy security with the ongoing benefit to the U.S. economy of a more stable
source of consistent energy supply over an extended period of time” (Delivering Economic
Benefits and Energy Security, 2011). The study claimed that “once the pipeline is operational,
the states along the pipeline route are expected to receive an additional $5.2 billion in property
taxes during the estimated operating life of the pipeline.” (Delivering Economic Benefits and
Energy Security, 2011). The project is also expected “to directly create more than 15,000 highwage manufacturing jobs and construction jobs across the U.S.” (Delivering Economic Benefits
and Energy Security, 2011). Also, when the system is complete, it is “expected to provide five
per cent of current U.S. petroleum-consumption needs and represent nine percent of U.S.
petroleum imports. Once permitted and completed, the Keystone Gulf Coast Expansion project
will supply roughly half the amount of oil that the U.S. currently imports from the Middle East
or Venezuela” (Delivering Economic Benefits and Energy Security, 2011).
3.0 Ethical Analysis of Issues – Ethical Frames
Although there are many different ethical questions of concern involved in this specific
issue, I chose to ask the key question that needs to be asked in this case, rather than smaller,
more specific questions. Ethical Question: Is it ethical to have the Keystone XL Pipeline cut
through thousands of miles of American land to link the growing supply of Canadian crude oil
with the largest refining markets in the United States? In order to analyze this question, we need
to list the specific facts involved in this case.

The pipeline will cost an estimated $7 billion

The system will carry approximately 900,000 barrels of oil per day

The distance the pipeline will be running is roughly 1,200 miles

The company in charge of production estimates more than 15,000 jobs will be
created in the U.S. as a direct result of this pipeline

If the owners of the property that the proposed pipeline will run through choose
not to agree to a payment, TransCanada will use eminent domain to seize that
land

The proposed pipeline will run over the Ogallala Aquifer, which is the largest
source of freshwater in the United States

TransCanada has granted waivers that effectively allow it to use thinner steel than
would normally be required in the United States
I am going to be analyzing the ethical question under each of the eight ethical frames:

Hedonism-Maximizes immediate profits

Egoism-Maximizes long-term profitability

Utilitarianism-Maximizes long-term benefits for the stakeholders

Restrained Egoism-Maximizes long-term profits and is fair to stakeholders and meets the
criteria of honesty, integrity, and concern for others

Libertarianism-It is the liberty of each person to live according to their own choices

Rawlsian-Do no harm, especially to the least advantaged

Kantian-Can be made into a categorical imperative

Blanchard & Peale
Is it legal?

Balances for stakeholders

Aligned with the Ethical Standards

Would you like to see it on the front page of the paper?
Under Hedonism, the ethical premise is that the situation maximizes immediate profits. For
example, by stealing money from a bank, you’re immediately getting paid rather than waiting for
a pay check that would arrive two weeks later. The Keystone XL pipeline will take years to build
and begin use, and therefore will not be profitable within that time. Hence, I concluded that it is
not ethical under Hedonism to have the Keystone XL Pipeline cut through thousands of miles of
American land to link the growing supply of Canadian crude oil with the largest refining markets
in the United States.
Under Egoism, the ethical premise is that the situation will maximize long-term profitability. By
building this pipeline, Canada will be opening up their oil to a much larger, international market.
In the past, Canada has dealt mainly with the United States in regards to oil; however, building
this pipeline to the Gulf of Mexico will allow Canada to bring in profits not only from the U.S.,
but other potential importers as well. Therefore, I concluded that it is ethical under Egoism to
have the Keystone XL Pipeline cut through thousands of miles of American land to link the
growing supply of Canadian crude oil with the largest refining markets in the United States.
Under Utilitarianism, the ethical premise is that the situation maximizes long-term benefits for a
majority of the stakeholders. The stakeholders are the owners, employees, customers, and the
rest of society.

Owners: For the owners, the situation would maximize long-term benefits. They
would be making a profit, as well as opening up their oil to international markets.

Employees: For the employees, the situation would maximize long-term benefits.
Not only would current empoyees maintain their jobs and current pay-checks, but
thousands of other jobs are going to be created in both Canada and the U.S.

Customers: For the customers, the situation would maximize long-term benefits.
The people who are unable to purchase this oil from Canada will now have an
outlet to do so.

Society: For the rest of society, the situation would not maximize long-term
benefits. Many of the private landowners are unhappy with Transcanada utilizing
eminent domain to take their land. There are several people who don’t believe in
the mining and use of tar-sands because they’re much more volatile, as well as a
larger carbon-emitter than conventional oil. The pipeline would pass over the
Ogallala Aquifer, which would put the largest freshwater resource in the U.S. in
potential jeopardy. There are many natural and pristine habitats, home to several
species of wildlfe, that would be at risk by putting in the pipeline.
After viewing the results of the stakeholder analysis, I concluded that it is ethical under
Utilitarianism to have the Keystone XL Pipeline cut through thousands of miles of American
land to link the growing supply of Canadian crude oil with the largest refining markets in the
United States.
Under Restrained Egoism, the ethical premise is that the situation maximizes long-term profits
and is fair to the stakeholders and meets the criteria of honesty, integrity, and concern for others.
After analyzing the situation under Egoism, we have concluded that it does maximize long-term
profits. Also, after analyzing the situation under Utilitarianism, we have concluded that it does
maximize long-term benefits for majority of the stakeholders. Although there is a lot of scrutiny
of potential issues that the pipeline could create, we can’t factor them in because they are not
solid facts. TransCanada claims that it is following the ethical standards of honesty, integrity,
and concern for others. They’ve made all of their plans available to the public, and encourage
feedback. By doing those things, I can only assume that they are conducting themselves under
the standards of honesty, integrity, and concern for others. Therefore, I concluded that it is
ethical under Restrained Egoism to have the Keystone XL Pipeline cut through thousands of
miles of American land to link the growing supply of Canadian crude oil with the largest refining
markets in the United States.
Under Libertarianism, the ethical premise is that it is the liberty of each person to live according
to their own choices, without the influence of government or societal entities. Libertarians feel
that property rights lie solely with the property owner; that no one can come in and tell you what
to do with your own personal property. However, TransCanada is doing just that by attempting
to purchase the land it needs to use, and by resorting to eminent domain. Therefore, I concluded
that it is not ethical under Libertarianism to have the Keystone XL Pipeline cut through
thousands of miles of American land to link the growing supply of Canadian crude oil with the
largest refining markets in the United States.
Under Rawlsian, the ethical premise is that the situation can do no harm, especially to the least
advantaged. When attempting to figure out whom exactly are the least advantaged in this
situation, I tried to look at who would not benefit from the creation and utilization of the
Keystone XL pipeline. Land-owners who are forced to give up their private property, as well as
wildlife that have absolutely no say in what happens to their precious habitats. Since
TransCanada is taking away private land and threatening valuable habitats and ecosystems, they
are not concerned with the least advantages. Therefore, I concluded that it is not ethical under
Rawlsian to have the Keystone XL Pipeline cut through thousands of miles of American land to
link the growing supply of Canadian crude oil with the largest refining markets in the United
States.
Under Kantian, the ethical premise is that a situation can be made into a categorical imperative;
it is the best option in every situation like this. There may be better options in situations similar
to this. For example, if Canada wanted to connect another pipeline to the Gulf of Mexico in the
United States, but chose to run it through a national park or national forest, then it would
probably not be the best situation. Therefore, I concluded that it is not ethical under Kantian to
have the Keystone XL Pipeline cut through thousands of miles of American land to link the
growing supply of Canadian crude oil with the largest refining markets in the United States.
Lastly, under Blanchard & Peal, the ethical premise is whether or not the situation is: 1. Legal?
2. Balanced for the stakeholders? 3. Aligned with the ethical standards? 4. Would you like to see
it printed on the front page of the newspaper? I reviewed the situation under these four questions:
1. Is it legal? – Yes, building an international pipeline is not illegal
2. Is it balanced for the stakeholders? – Yes, just like under Utilitarianism, the stakeholders
are balanced
3. Is it aligned with the ethical standards? – Yes, similar to Restrained Egoism, I have no
evidence that TransCanada is not aligned with the ethical standards
4. Would you like to see it printed on the front page of the newspaper? – Yes, TransCanada
would love to see that the Keystone XL Pipeline is on the front page of the paper for
being in production. That means that their goals are being met.
Therefore, I concluded that it is ethical under Blanchard & Peale to have the Keystone XL
Pipeline cut through thousands of miles of American land to link the growing supply of
Canadian crude oil with the largest refining markets in the United States.
4.0 Lessons Learned
Although there are several ethical frames that say the construction and operation of the
Keystone XL pipeline is ethical, I think we need to review history to see what the best option is.
Just by learning a little about the Keystone 1 pipeline, it’s obvious that these pipelines are
difficult to trust. However, I see no end of using oil in sight. Therefore, I think it is necessary that
if this pipeline is going to be built, there are some key measures that need to be taken. First of all,
the pipeline cannot cross the Ogallala Aquifer. The need for freshwater is growing, just as our
water supplies are diminishing. Pretty soon the world’s need for oil will no longer matter,
because there will be no more water. Therefore, risking the largest source of freshwater in our
country seems like a ridiculous idea. Secondly, the safety measures going into the pipeline need
to be top-notch. This idea of using thinner steel does not seem like a wise choice, especially
seeing the history of pipelines with similar pipe-widths. TransCanada needs to find what the best
and safest option is, not the cheapest. Lastly, a percentage of the profits the United States will
gain from the usage of the pipeline needs to be put directly back into the research and creation of
more sustainable energies, such as wind and solar power. Although we have seen a large boom in
the more eco-friendly technologies, we are obviously not nearly close enough to utilizing them
on a large scale. Therefore, we need to start funding these alternative energy sources so we no
longer have to rely on crude oil.
5.0 References
Delivering Economic Benefits and Energy Security. (2011, May 5). Retrieved from
TransCanada:
http://www.transcanada.com/docs/Key_Projects/Keystone_Benefits_US_July_2010.pdf
Henry, T. (2012, April 19). Life on the Line: Landowners Fight Keystone XL and Eminent
Domain. Retrieved from StateImpact:
http://stateimpact.npr.org/texas/2012/04/19/lives-on-the-line-landowners-fight-keystonexl-and-eminent-domain/
Keystone Pipeline Infographic: ‘Built To Spill’. (2011, October 29). The Huffington Post.
http://www.huffingtonpost.com/2011/08/29/keystone-pipelineinfographic_n_941069.html
Keystone XL Pipeline Project. (2012, April 5). Retrieved from TransCanada:
http://www.transcanada.com/keystone.html
Rosenthal, E. (2011, June 3). U.S. Orders TransCanada to Shut Pipeline. The New York Times.
http://green.blogs.nytimes.com/2011/06/03/u-s-orders-transcanada-to-shut-pipeline/