End of oil export ban raises stakesat Vancouver

Let’s get it in writing. In the wake of this month’s lifting of a ban on oil exports from the United States, the companies hoping to build a rail-to-marine oil terminal in Vancouver say that crude coming through the city still likely would be destined for West Coast ports. No problem there; we just could use a little insurance.

For 40 years, since the Organization of Petroleum Exporting Countries imposed an oil embargo upon the United States and caused gasoline prices to soar, this nation has banned the export of domestically produced oil. It wasn’t a big deal, considering that the United States was a small player in the world oil market, but the goal was to preserve domestic supplies and provide some stability to domestic prices.

That dynamic has changed in recent years with a boom in production from the Bakken region of North Dakota and Montana. The United States is now the world’s leading oil producer, a fact that has altered the landscape of the industry. At the urging of oil companies, Congress agreed to lift the ban on exports as part of a $1.1 trillion omnibus spending bill approved last week.

While that provision represented capitulation to oil producers and was criticized by environmentalists, it was approved in exchange for other environmentally friendly stipulations — including renewal of the Land and Water Conservation Fund. It was a bipartisan deal that featured give-and-take on both sides.

For the interests of Southwest Washington, however, the most notable issue was the lifting of the ban on exports. That is because of an agreement between Tesoro Corp. and Savage Cos. with the Port of Vancouver to build the nation’s largest oil-to-marine terminal, one that could bring up to 360,000 barrels of crude per day by train down the Columbia River Gorge and into the heart of Vancouver. The deal is undergoing a review at the state level and eventually will be sent to the governor for a final decision.

A year ago, Tesoro executive Dan Riley told The Columbian’s Editorial Board that even if the export ban was lifted, the economics of the project dictate that oil would be destined for U.S. refineries. But, he added, there was “nothing written into the contract.”

Forgive our skepticism, but we would like to get that in writing.

The terminal plan as it stands would bring an estimated four unit trains per day — more than 100 cars each — bearing crude oil through densely populated areas. And the deal would allow for Tesoro and Savage to expand the terminal — a fact that initially was obfuscated through redacted documents.

Given the risk of oil trains, as documented by a series of derailments and explosions, increasing the volume would only increase the risk to Washougal, Camas, Vancouver and the Columbia River.

This story was originally published December 27, 2015 at 4:01 PM with the headline "End of oil export ban raises stakesat Vancouver."