This Is What a Neighborhood Oil Spill Looks Like


On Friday afternoon in the town of Mayflower, Ark., a leak occurred in ExxonMobil's Pegasus pipeline spilling crude oil all over yards, driveways, and into the street.

On 2 blocks, 22 homes were evacuated as over 12,000 barrels of oil and water leaked from the pipeline.

Source: Photos of OccupyMARINES

The Pegasus pipeline is an 848-mile long, 20-inch thick, crude pipeline that connects Patoka, Ill., to Nederland, Texas. In 2009, Exxon expanded the pipeline's capacity by 50% to 90,000 barrels per day. After learning of the spill, Exxon shut down the pipeline and emergency personnel responded to the spill site within 30 minutes. Exxon sent 15 vacuum trucks and over 100 personnel to begin cleaning it up and to figure out what happened. Inspectors and staff from the Environmental Protection Agency as well as the Pipeline and Hazardous Materials Safety Administration also responded.

Opponents of TransCanada's Keystone-XL pipeline are taking advantage of the spill to push the White House not to approve the Keystone-XL. Opponents hope that by stopping the pipeline they will slow the development of oil sands in Canada which is being led by SunCor Energy and Canadian Natural Resources. Opponents argue that the development of oil sands is terrible for the environment and that oil sands are more corrosive to pipelines than predicted. However, not approving the pipeline won't stop the development of oil sands. Producers will find some way to transport their goods; so far, the effect has just been a large increase in railroad traffic.

While the spill is terrible for residents, pipelines are safer, less polluting, and more efficient than the alternatives of transporting oil by truck or railcar. A recent report from the EPA found that the environmental impact is not as bad as opponents claim. Pipeline accidents, like airplane crashes, suffer from availability bias, which means that since the media heavily reports every major accident, people overestimate the probability of such an event happening again. That's why after an airplane crash fewer people fly, yet people don't worry about driving everyday even though it is far more dangerous.

Despite such setbacks like this pipeline spill, oil and gas development will continue, but you don't need to invest in producers or pipelines to profit from it. There are many different ways to play the energy sector, and The Motley Fool's analysts have uncovered an under-the-radar company that's dominating its industry. This company is a leading provider of equipment and components used in drilling and production operations, and poised to profit in a big way from it. To get the name and detailed analysis of this company that will prosper for years to come, check out the special free report: "The Only Energy Stock You'll Ever Need." Don't miss out on this limited-time offer and your opportunity to discover this under-the-radar company before the market does. Click here to access your report -- it's totally free.

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Dan Dzombak can be found on Twitter @DanDzombak or on his Facebook page, DanDzombak. He has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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