Good news: It looks like the year-and-a-half-plus delay mandated by President Obama last week might have killed the Keystone XL. Bad news: It’s not the only potential fuse to trigger the giant carbon bomb known as the Alberta Tar Sands. There is another pipeline proposal that also would allow for cost-effective large-scale supertanker exports of the stuff to overseas markets.

Before we look at the new threat, let’s review some facts about the old one. The sales pitch the Keystone XL pipeline’s defenders push — that Keystone XL’s content is destined for the gas tanks of Americans and will crowd out Evil Saudi Oil — is not exactly true: The biggest single chunk of it (at least 20% and very likely a lot more) is going straight to Port Arthur to be shipped overseas courtesy of Valero, and that won’t be the only chunk of this chunky goo to go outside of the US. In other words, we’re not adding jobs (TransCanada has admitted it lied about that), we’re not giving the middle finger to the Evil Saudis, we’re simply helping TransCanada ship its customers’ goo overseas — and lighting the fuse on the world’s biggest carbon bomb.

Oh, and get a load of how Valero dances around the whole question of where their share of the goo is going:

“As far as I know, we’ve never said anything about exporting products to China, nor do we have plans to,” Valero spokesperson Bill Day told Platts EnergyWeek. Day’s statement is technically accurate — the company actually intends to export tar sands products like diesel and jet fuel tax-free to Europe, Mexico, and South America.

But just when you thought the plan to utterly unlock the Alberta tar sands to large-scale supertanker export was doomed, guess what? Enbridge, a rival company to TransCanada might try to revive their old plan to get the tar sands muck to the Gulf (and thus into supertankers headed overseas) via their own proposed pipeline, which will start in Flanagan, Illinois. Per BusinessWeek:

The new segments should face less opposition and regulatory review because they would follow routes where Enbridge already controls rights-of-way, [Enbridge CEO Pat] Daniel said on the conference call.

Enbridge’s new pipeline system also would benefit from growing onshore production in states like North Dakota, where the company already has pipelines, Jackie Forrest, director of global oil for IHS Cambridge Energy Research Associates, said in a telephone interview. An oversupply at the Cushing, Oklahoma, oil storage hub also would help fill the pipeline’s capacity, she said.

Enbridge’s plan would bring Canadian crude to Texas by mid-2013, the same time period Calgary-based TransCanada originally planned for Keystone to be finished.

The first part of the planned Enbridge pipeline (the “Alberta Clipper” part) has already been built out all the way to the twin ports of Duluth, Minnesota, and Superior, Wisconsin, and was opened up for business last year. But the oil can’t go out of the Great Lakes via the usual route through the locks system, because the most (and likely only) economical way to ship the oil is by supertankers that are too big for the Great Lakes locks, so Enbridge’s plan is to move it through existing pipelines to Flanagan, a small community 45 miles southwest of Chicago, and then from there to the Gulf via the proposed Flanagan pipeline.

But what the BusinessWeek article doesn’t mention is that the Flanagan plan has already been rejected twice by the Federal Energy Regulation Commission:

Responding to the forecast growth in oilsands and industry concerns that crude could be pipeline constrained, Enbridge added significant additional transportation capacity to serve Midwest markets. However, it now appears that will result in surplus capacity until late this decade. Southern Access added 400,000 bbl per day from Superior, Wisconsin, to Flanagan, Illinois, in 2009.

The original plan was for Enbridge to expand the line to 700,000 bbl per day to balance inbound and outbound capacity at Superior and add additional takeaway capacity downstream of Flanagan, which would provide access to the transportation hub at Patoka, Illinois.

However, in two tries before the Federal Energy Regulation Commission (FERC),
Enbridge was unable to obtain approval for its tolling proposal for the Southern Access extension from Flanagan to Patoka, where it would have connected to the proposed Texas Access project to the Gulf—a project that has been shelved.

“Without a Southern Access expansion and additional takeaway capacity
downstream of Flanagan [Southern Access Extension], incremental Alberta Clipper volumes would bottleneck at Superior, rendering the Alberta Clipper capacity ineffective in reaching additional refining markets,” said Wood Mackenzie.

Of course, now that Keystone XL is on the ropes, the Flanagan plan will likely be revived. The good news is that we can get out in front of this and raise awareness in the populated areas the pipeline must traverse. It’s one thing to sneak a pipeline into relatively-people-empty parts of the Dakotas and northern Minnesota and have it in place before the folks there are quite aware of what just happened. It’s quite another to try it in places where there are lots more people, especially if those people are mobilized to stop it.