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[Editor's note: A version of this story appears in the June 2021 issue of Oil and Gas Investor magazine. Subscribe to the magazine here.]
The hacking of the Colonial Pipeline and its subsequent shutdown in May unleashed one of the worst spills of schadenfreude—or delight in other’s misery—in modern history.
The National Review, with clear glee, reported that “seventeen states and—oh, glorious irony!—the District of Columbia have declared states of emergency after the closure of the Colonial Pipeline.”
This same article lamented how quickly the Texas ice storms that claimed 111 lives in February were forgotten.
Perhaps that’s the cost of whimsy.
The “Colonial effect”—long lines of panic buyers at gas stations—was also captured on video, naturally. Footage included a nasty confrontation in which a woman exited her car and spat on a male driver. He retaliated with a saliva sample of his own. Inevitably, the two began brawling.
Instagram, we owe you so much. People now can judge for themselves just how awfully carried away people get over a silly little thing like fuel.
But what will be the takeaway from the Colonial Pipeline hack, other than bad puns? Perhaps that companies should harden cyber defenses? Or that paying cyber extortionists is a bad idea—although Colonial reportedly did cough up a $5 million ransom.
Nope. The object lesson is the collective shrugging of shoulders—a communal, “So what?” with an emoji added for emphasis.
On Capitol Hill, the woes of millions translated into debates about how to define infrastructure instead of actually doing the work. President Joe Biden hosted a playdate with Republican leaders in the Oval Office, which quickly devolved into who got the better of whom press conferences.
Texas Sen. Ted Cruz called the Colonial Pipeline hack Biden’s “gas crisis.” But those performative slogans won’t add to the depleted ranks of qualified truck drivers to haul gasoline. And it won’t give pipeline companies the ability to perform basic maintenance on their existing pipelines.
The “what’s-in-it-for-me” gestalt just isn’t healthy, even for the Cancun-enabled.
Drue Pearce, director of government affairs at Holland & Hart, said she’s seen a self-centeredness at work for years when it comes to pipelines.
Pearce served as deputy administrator of the Pipeline Hazardous Materials Safety Administration and as a senior advisor to Secretaries of the U.S. Department of the Interior. She was a member of the Alaska legislature and an appointee of President George W. Bush.
Pearce said that infrastructure is quick to draw opposition from the ‘Keep It In The Ground’ crowd, but also from people who didn’t support a pipeline because it doesn’t directly benefit them.
“Americans don’t recognize the benefits—I have to say, I’ve heard it in public testimony— they don’t care how it affects their neighbor,” she said.
After a stunned silence, Pearce said, “It is stunning.”
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Hurdles to building new pipelines or any transportation system, including railroads, roads or transmission lines, are easy to tangle up with lawsuits.
“Now we’re seeing litigation when companies are merely trying to increase the flow or double the capacity of a line that’s already in place,” she said. “That’s also discouraging because it is inefficient to put gasoline or crude oil into tanker trucks and put them on the highway.”
Attempts by Dominion Energy Co., for instance, to increase capacity for a gas line crossing from Virginia into Maryland to its Cove Point LNG facility were fruitless.
“They were stymied by the local opposition,” she said. “The way they were stymied was that they could not get the permits to build the compressor stations that they needed.”
The local argument was that the community didn’t want pollution in an area Pearce said was overrun by personal propane tanks.
The unneighborly attitude extends to New York, which will not allow pipelines in the state. The net effect is the importation of Russian gas into Boston Harbor.
“It’s a very state-centric attitude,” she said.
Biden’s decision to cancel the Keystone Pipeline is perhaps the most prominent example of the irrational animus toward long metal tubes. Why not help Canada, our closest ally, export its crude? Opponents say, among other reasons, because it doesn’t help the U.S.
Pipelines in the U.S. are owned by the private sector, of course. Whatever happens with the infrastructure plans of the current administration, dollars won’t necessarily be going to pipelines. But Pearce said that even when there’s bipartisan urges to address, say, cast iron pipes dating back to the Civil War, it’s hard to make progress.
Every administration seems to recognize such problems, but “it hasn’t been the top priority,” Pearce said.
The Colonial Pipeline debacle was just another exercise in scoring points, ignoring the needed updates to 40-year-old regulations and keeping the problem underground.
Enjoy the street fighting. It’s all we get.
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