"Oracle of Omaha" Profits from Tar Sands

Buffet: paying for face time?

Warren Buffett, the third richest man in the world with an estimated worth of $39 billion, will make even more money off the Alberta tar sands because his closed-end investment fund, Berkshire Hathaway, bought the Burlington Northern and Santa Fe Railway in 2009. BNSF will transport bitumen south for refining at Port Arthur, Texas now that the Keystone XL project has been put on hold during an election year. According to an analysis by the State Department, railroads can transport all of the bitumen produced in Canada with modest expansion of facilities through 2030. The cost of hauling by rail will be more than a pipeline ($3 more per barrel), the potential environmental impact would be lessened but greenhouse emissions greater.

BNSF is already involved in the Alberta oil patch. According to the employees' newsletter it hauls the diluting agents such as natural gasoline and butane used to move heavyweight bitumen through existing pipelines. BNSF hauled 9,000 carloads of diluents last year and expects to haul 12,000 this year. BNSF also hauls pipeline components and heavy machinery used in Alberta operations. Buffet's railroad transported pipe material for the first Keystone pipeline, and probably will haul the material for the XL if it is built. The company is on the distribution list for State's environmental impact statement.

Buffet's ownership of BSNF is not his only financial tie to the Albert tar sands development. His fund owns pieces of Conoco-Phillips, Exxon-Mobil and General Electric. All of these companies are doing business related to the tar sand oil play. For example, in July the Silvertip pipeline owned by Exxon-Mobil burst while carrying bitumen, polluting the near pristine Yellowstone River with 1,500 barrels of oily sludge [photo credit: AP].

Obama's hand was forced by an unachievable deadline imposed by the House of Representatives and the pressure asserted by environmentalists to cancel for the immediate future Keystone XL. But the project is far from dead. Whether he can be counted on to cancel the project again during his second term is an open question. Warren Buffet is a big contributor to Obama. He hosted a 2008 Chicago fundraiser which cost attendees the maximum individual contribution of $28,500 just to get in the door! Obama reciprocated, awarding Buffet the Presidential Medal of Freedom in 2011. Even larger amounts are being spent on Obama by Buffet and other plutocrats this time around. To get into the VIP reception with Buffet and Obama in New York cost the well connected rich a cool $35,800 This is what happens when a nation equates money with freedom of speech*. Will Buffet get more than a medal if his man wins a second term? Stay tuned.

*The Obamacon raised an unprecedented $745 million for his first run and already has raised $224 million for his re-election effort. Obama refused public financing in 2008 so he could raise unlimited amounts of cash and has not advocated for a system of public financing to replace the auction we have now. Mitt Romney, who could be a stand in for the cartoon character Richie Rich, could raise that much and more not counting the soft money raised by right-wing super PACs. Already these debilitating spawn of Citizens' United have outspend GOP candidates in several of the primary races. Romney got Florida delivered to him on a golden plate by his super PAC (officially unrelated Mr. Justices). The plutocracy is solidly behind the former Massachusetts governor in holy underwear and they have the deepest pockets in America. Does US Person hear $1trillion?