What if you could choose where your fuel comes from?
In the United States, crude oil that is refined into gasoline comes from many sources: Mexico, Venezuela, and Saudi Arabia all supply the American market, along with oil fields in states such as Texas and North Dakota.
The largest share of U.S. petroleum, however, comes from Canada's oil sands—a fount of new oil wealth that is behind the push to expand the Keystone XL pipeline to U.S. Gulf Coast refineries.
Now the Sierra Club and other groups opposed to the pipeline are urging corporations to shift their fuel purchases away from refineries that process sticky diluted bitumen, or "dilbit," from the Canadian oil sands. (See related story: "Oil Spill Spotlights Keystone XL Issue: Is Canadian Crude Worse?")
The aim is to make the transportation-fuel industry more transparent, and to hinder the expansion of tar sands development. But it remains uncertain how much real impact such a boycott can have.
What Goes Into the Gas Pump?
Individual consumers have no way of knowing the original source of the fuel they buy: Retail gas stations get their product from multiple refineries that are impossible to trace.
But some corporations—those that buy directly from refineries or from certain fuel vendors—have the power to investigate what type of oil is being used in their commercial fleets.
The Sierra Club's newly published guide for corporations includes a list of 117 refineries arranged much like a sustainable-seafood consumer guide, categorizing them neatly in three color-coded columns: "OK to Use," "If Necessary," and "Avoid."
Several large companies, including Whole Foods, Trader Joe's, Seventh Generation, and Walgreens, have already made efforts to reduce their consumption of tar sands oil by changing their fuel suppliers. The Sierra Club list is intended to make such boycotts easier for corporations to execute.
Such actions have the potential to send a message. Corporate and government fleets account for 35 percent of transportation-related oil consumption, according to the Sierra Club report.
Targeting the Tar Sands
Why target Canadian crude in particular? Environmentalists point out that the methods used to extract and process oil from the sands in Alberta, 600 miles north of the Montana border, give it a higher carbon footprint than conventional varieties of oil.
Canada's oil sands have also become symbolic of the larger fight over the energy industry's new push to develop oil and gas resources that were once commercially unviable or out of reach.
"One important reason why we're so alarmed by the Canadian tar sands industry is because it is growing at such a tremendous rate," said Gina Coplon-Newfield, director of Sierra Club's Future Fleet and Electric Vehicles Initiative.
Venezuela also exports oil sands crude, but its production is declining.
The International Energy Agency, in its most recent World Energy Outlook, projects that output from Canada's oil sands will more than double by 2035. Continuing the use of tar sands oil, Coplon-Newfield said, "could really spell game over for the planet in terms of its impact on carbon emissions."
One Refinery, Many Sources
Industry officials contacted by National Geographic say the Sierra Club effort is misguided because it fails to take into account the way refinery operations actually work.
A refinery's mix of crude oil inputs changes on a daily basis, according to Bill Day, vice president of communications for Valero, which operates refineries under all three Sierra Club labels of "OK," "Avoid," and "If Necessary."
"There are some refineries where we have a pretty good idea what the crude slate is going to be," Day said, but the process of buying crude for Valero's facilities is "a very big logistical challenge that happens on an ongoing basis."
The Sierra Club based its list on research from Oil Change International (OCI), a nonprofit organization that advocates for clean energy. Lorne Stockman, OCI's research director, said that publicizing oil sands inputs is part of an effort to boost the transparency of refinery operations.
"Refineries are really opaque," Stockman said. "The data is hard to get, they're quite secretive, they don't publish their feedstocks and emissions very clearly. So we're trying to resolve that with [this research]."
Sierra Club places under its "Avoid" column refineries that "regularly receive significant quantities of tar sands crude." But the numbers vary widely from one red-listed refinery to another: HollyFrontier's Woods Cross refinery north of Salt Lake City, Utah, for example, processed fewer than 1,000 barrels of oil sands crude per day in 2012—about 4 percent of its total input; in the same group, ExxonMobil's Joliet refinery in Illinois processed 164 times that amount—76 percent of its total.
OCI is careful to note that its numbers should be "used as an indicator of levels of tar sands processing at refineries and not precise calculations." It is updating the data annually and plans to release 2013 numbers soon, Stockman said.
Though it's true that the percentages of Canadian crude at any given refinery can fluctuate, he said, typically refineries that have invested in the equipment to process that type of oil will keep doing so in some amount; economically, it makes sense for them to do so. "The Canadian stuff is cheaper," he said.
Hungry for Cheap Crude
Indeed, Day said that Valero wants more Canadian crude (and supports the Keystone XL pipeline that would transport it). Aside from the cost advantage, the company's Gulf Coast refineries—which are outfitted to process heavy oil—want Canadian supply as a replacement for declining production from Venezuela and elsewhere in South America.
"I think one of the things [critics] don't understand is, this oil coming out of Canada, what they call the tar sands, is not any different than the heavy oil that's being processed at refineries today and has been processed at refineries for decades," Day said. "It's the same stuff, it's just coming from a different location."
Opponents of Canadian oil sands development become alarmed by that kind of analysis.
"Once any company understands what the tar sands are, they don't want it in their footprint directly or indirectly," said Aaron Sanger, a consultant with the nonprofit ForestEthics who has worked directly with corporations and the city of Bellingham, Washington, to implement policies that would reduce use of tar sands oil. "It's a clear choice for many of these companies to vote with their fuel purchasing dollars against extending our dependence on oil."
Tracking the Oil
Some companies, such as Columbia Sportswear and eBay, have adopted policies that ask transportation or fuel providers to say what actions they are taking to reduce tar sands use. But a no-tar-sands policy is "more effective when it results in actual switching of a fuel contract from a refinery that uses tar sands to a refinery that does not use tar sands," Sanger said.
When Walgreens started changing its fuel contracts, Sanger said, "several tar sands refineries experienced that loss of demand." He cited Whole Foods and Trader Joe's as other examples of companies that were able to shift part of their supply chain to refineries that do not use Canadian crude. (See related story: "The New Truck Stop: Filling Up With Natural Gas for the Long Haul.")
But the number of companies capable of making these types of fuel switches are "just a drop in the bucket" relative to the way most fleets are fueled, according to Joanne Shore, chief industry analyst for the American Fuel and Petrochemical Manufacturers trade group.
Many fleet managers buy gasoline from depots or bulk vendors that mix fuel from a variety of sources, allowing little insight into which refineries it came from.
Some fleets may have direct access to fuel terminals that are attached to specific refineries, Shore said. But, she said, "I don't see that the volumes involved would be substantial at this point."
Powerful Market Forces
On the Gulf Coast, Shore pointed out, refiners have "any number of markets they can get to" if they lose some domestic corporate demand. In other regions, such as the Pacific Northwest and upper Midwest, where Canadian crude is too powerful a market force for refineries to ignore, it is all but impossible to boycott the tar sands.
Bellingham, Washington—a coastal town at a nexus of burgeoning energy transport traffic—passed a resolution a few years ago calling for a reduction in tar sands oil in its fuel as part of an overall climate change action plan. But every refinery in the region processes Canadian crude from up north.
Given that reality, said Bellingham city council member Jack Weiss, "It's going to be harder . . . to effectively do what we're wanting to, under this policy. It's a hard thing, no doubt." (See related story: "Seeking a Pacific Northwest Gateway for U.S. Coal.")
Ultimately, Weiss hopes that such boycotts will become unnecessary. The campaign to use tar-sands-free fuel would be "somewhat a meaningless exercise if we were to be more aggressive with our conservation standards," he said. "Energy efficiency in any form is really where the answer is."