Posted on 01/05/2015 10:41:53 AM PST by thackney
Like a lot of other dramatic bluster coming south out of Canada this winter, the Keystone XL pipeline stands poised for its big approval fight this month.
Advocates claim it will put Montana in the mix for North American energy independence.
Opponents say it will allow the most polluting oil on the planet to contribute to global warming while putting water supplies at risk.
The U.S. Senate fell one vote short of approving Keystone during its lame-duck session last month, even though President Barack Obama threatened to veto the measure.
But what if it doesn’t matter?
While the Keystone project has held the headlines for the past five years, two other trans-boundary pipelines have neared completion with more capacity than it promises. And Canadian firms have designed two more that could cut Americans out of the debate entirely.
“Products find their ways to markets, if not south, then east or west,” University of Montana Bureau of Business and Economic Research director Patrick Barkey said last week. “Even if Keystone had been developed, they (oil companies) would be sniffing around for more capacity in coming decades. That’s why the debate over Keystone becomes a little more symbolic than practical.”
Both Democratic Sen. Jon Tester and Republican Sen. Steve Daines have declared their intention to get Keystone XL approval early in the 2015 Senate calendar. Rep. Ryan Zinke pledged to introduce similar legislation when he’s sworn into the House of Representatives on Jan. 6. Incoming Senate Majority Leader Mitch McConnell, R-Kentucky, promised it would be the first bill the chamber considers.
The project became a federal fight because the U.S. State Department has authority to approve boundary-crossing infrastructure. The line crosses four states besides Montana.
Canadian analysts consider the tar-sand deposits in northern Alberta to be the third-largest oil deposit in the world, after Saudi Arabia and Venezuela. But the oil must be essentially strip-mined from sand deposits and treated with steam or centrifuges to remove bitumen, which resembles tar at room temperature.
Alberta lacks the refinery capacity to turn that much bitumen into fuels like gasoline or diesel, so it’s been developing ways to ship it to more developed areas in the United States.
TransCanada’s Keystone XL pipeline would move petroleum from the tar-sand deposits of northern Alberta south through northeast Montana and the Bakken Formation oil fields to Steele City, Nebraska. Existing pipelines would move the crude oil from there to refineries on the Texas Gulf Coast.
Keystone XL would have a capacity of around 830,000 barrels a day along its 1,179-mile span, including 100,000 barrels coming from Bakken suppliers. That would boost Montana’s access to refinery buyers.
“That’s why we think Keystone is still a viable project,” said Dave Galt of the Montana Petroleum Association. “I still support it.”
***
Much of the state’s oil now rides rail cars west to the Port of Vancouver in Washington. And that rail option has seen growing interest, according to UM's Barkey.
“Four or five years ago, a lot of people in the transportation business thought rail was the last resort – what you did when you couldn’t do anything else,” Barkey said. “But in the last few years, some peculiar things have happened. Some big differences have opened up in the prices refineries will pay for crude. A Southern California refinery might be willing to pay enough of a premium that it’s actually worth it to have it railed out there.
"Pipelines are more efficient and safer, but they only go to one place. Rail gives you the freedom to exploit price differentials that open up across markets. And the delay of Keystone has made rail a strategic option, not just an option of last resort.”
About 20 trainloads of petroleum a week come through Montana to the Vancouver depot. Proposals to expand Pacific Coast oil facilities could boost that to 137 trains a week by 2020, according to the Washington Department of Ecology.
But TransCanada is also working on a $1.9 billion line between Pontiac, Illinois, and Cushing, Oklahoma, that would accomplish the same goal of getting Alberta petroleum to Texas refineries.
That pipeline crosses mainly private land entirely within U.S. borders, so the federal government has little involvement. It could move up to 880,000 barrels a day, more than Keystone XL’s proposed capacity. It won a legal fight in August and has nearly finished construction.
Meanwhile, TransCanada competitor Enbridge claims to operate the world’s longest crude oil and liquids delivery system.
It has 15,795 miles of pipeline in North America, which carry 2.2 million barrels of oil and other liquids daily. That includes 53 percent of Canadian petroleum bound for the U.S. market – about 15 percent of total U.S. crude oil imports.
Enbridge claims to be the largest pipeline operator in both the Canadian tar sands and the Bakken Formation on the U.S.-Canada border.
And it has a project to switch oil from Enbridge’s existing Alberta Clipper pipeline to Line 3 in Grenta, Manitoba, before it leaves Canada, and then switch it back 20 miles south inside North Dakota. The oil would then go to Superior, Wisconsin. Also known as Line 67, it won U.S. federal approval in 2009. It roughly equals the Keystone XL capacity and is already running.
Enbridge also hopes to complete its $6.5 million Northern Gateway pipeline that runs “1,177 rational and respectful kilometers” from Bruderheim, northeast of Edmonton, roughly due west to the port of Kitimat on a deep fjord east of Prince Rupert. Kitimat’s marine terminal would handle about 220 ships a year.
The Northern Gateway pipeline design uses old roads, clear-cuts and other disturbed areas for 70 percent of the route, according to Enbridge. However, it has hit strong opposition from Canadian Indian tribes and environmental groups.
And TransCanada has still another pipeline proposal running east out of Alberta to refineries in Canada’s eastern provinces. It’s reportedly going to cost about $12 billion.
Timing is another factor.
Several energy industry analysts have wondered if the drop in oil prices below $60 a barrel would hinder related building projects. Platts.com writer Janet McGurty reported on Dec. 30 that while a lot of Bakken crude oil should become available in 2015, exploration is expected to slow down in the coming year.
That “could stifle the growth of new infrastructure projects in both pipeline and rail,” the article stated.
The current price drop likely will prune out some of the get-rich-quick oil explorers but not affect the bigger companies. And it’s the international players who build pipelines.
“When prices start changing, that would have some impact on the project as well,” said Jim Halvorson, of the Montana Board of Oil and Gas. “But pipelines make money regardless what the final price of the product is."
False. Most of the Canadian oil sands are too deep for strip-mining. Most will be "harvested" from wells with the top soil left in place.
In Alberta, 80 per cent (135 billion barrels) of the oil sands are buried too deep below the surface for open pit mining and can only be accessed through in-situ methods such as Steam Assisted Gravity Drainage (SAGD).
I haven't heard the "water supplies at risk" excuse, or seen any proof. We could use some more Global Warming. If only we had some control over it.
The tech behind the Keystone Pipeline
http://www.foxnews.com/science/2014/12/31/tech-behind-keystone-pipeline/
Advanced steel is part of it. The current part of the Keystone pipeline that already exists uses 2,638 miles of hardened steel built to “withstand impact from a 65-ton excavator with 3.5-inch teeth,” according to TransCanada, the company behind the Keystone pipeline.
The steel is also coated with alloys to prevent it from wearing out.
“They use all kinds of methodologies to reduce friction. Corrosion inhibition is pretty sexy stuff in this business,” Eric Smith, associate director of Tulane University’s Energy Institute, told FoxNews.com
Pumping stations are another critical part. All along the pipeline, pumps move the oil using centrifugal force: a motor spins and forces oil to the edges of the pump, which causes more oil to rush forward to take the place of the oil pulled to the edges.
Each pump has 6,500 horsepower – meaning that the pump exerts an amount of power roughly equivalent to that of 6,500 horses. Total pumping power on the existing pipeline is nearly half a million horsepower, according to TransCanada.
Another critical technology is leak detection systems. The existing Keystone pipeline, for instance, has sensors that collect data from 20,000 different points along the pipeline.
If a leak occurs anywhere along the pipeline, the pressure in the pipeline changes, and TransCanada notes that such changes travel through the pipeline at the speed of sound and so can be detected nearly instantly.
The company adds that the pipeline has “fail-safe” mechanisms that automatically reduce oil pressure in the pipeline to safe levels.
TransCanada also has airplanes monitor the pipeline from the sky, using both the eyes of human pilots and a “Laser Spectroscopy Unit” that shoots a laser near the pipeline and then analyzes the reaction of whatever material is hit by the laser beam. TransCanada says this is “capable of identifying tiny methane leaks at patrol altitudes.”
Keystone, it would seem, is already a successful project in that it has provided cover with all its concentration of leftist green ire away from the other projects that are getting the job done.
I don’t necessarily buy into the Republic global corporate mantra.
I oppose eminent domain by any corporation, be it foreign or domestic. I’m not a fan of the Keystone Pipeline or any pipeline that is built to export oil. Then it is not a USA public utility but a plan to make profits for foreign corporations and shareholders, at the expense of American property owners.
Additionally I support landowners receiving an ongoing royalty on any use of their land as a pipeline to carry oil, just as Hollywood entertainers get lifetime profits for the use of their often crap entertainment. The reality is that a pipeline through your property is a detriment and perpetual liability. It is not an asset unless the landowner is paid royaties for that use of property.
If the oil remains non-exportable and intended to make the USA energy sufficient and to make us more competitive, then a case can be made on eminent domain. If not, I see eminent domain for profit as a most vile anti-American form of crony corporatism.
“Proposals to expand Pacific Coast oil facilities could boost that to 137 trains a week by 2020”
Maybe they need a pipeline to go from the Balkan to Vancouver, Wa. ?
Or is there already one proposed? It seems like the ROI would pretty easy to calculate based on what it costs for each BNSF train plus the additional loading and offloading costs at origin and destination.
Interrupted:The First Nation people need to get a piece of the action
http://www.transmountain.com/proposed-expansion
From the Balkans would be a tough pipeline to build ;-)
I don't see government selection of road locations much better than utility construction.
I do assume you want your electricity, natural gas and transportation fuel to be available at competitive prices.
There is another pipeline that is being quietly stitched together using existing pipe infrastructure in Ontario that ultimately leads to the Atlantic. A short segment in the Maritimes (I think) still has to be built to reach the coast north of Maine, but after that they can run supertankers down to Gulf of Mexico to reach the US refineries in TX, LA, and MS that are equipped to refine the heavy sulfur-rich crude.
It’s cheaper than rail, but not as cheap as a direct pipeline. The point is that the environmentalists’ argument that stopping the Keystone pipeline will somehow prevent that oil from getting out and raising CO2 levels is stupid. The oil is getting out. The only question is how.
The Energy East Pipeline. http://www.energyeastpipeline.com/
Yep, they are just spending more energy, less efficient methods, and still getting it to market.
Maybe they need a pipeline to go from the Balkan to Vancouver, Wa. ?
They can also run it due east to Saint John, New Brunswick where JD Irving has his refinery right on the Atlantic Ocean.
The oil train that burned down the town in Quebec a couple years back was going to the Irving refinery in NB.
The other major destination for many of these oil trains going east are the refineries in NJ. The CPRS is bringing oil trains to Albany, NY. From there they are transferred to a barge that brings it down the Hudson River to Newark, NJ. These are the refineries that supply the NYC area. There are also refineries further south that supply the Philly, Baltimore, and DC markets.
Therefore, the densest population centers in North America could be supplied with petroleum products from the US/Canada. I would assume these areas use more gasoline, diesel fuel and heating oil than all of the Midwest and Southeast combined. Prior to three years ago I would have thought that most of the petroleum products used in the northeast came from foreign countries other than Canada.
By the way, the environMENTALists and NIMBYs have the same desire.
Buy a 1 foot wide strip along the farmland. Grant the farmer surface easement. Stop all energy development forever.
I realize: Bakkan/Balkan
I was being a smart A$$.
I always mix those two up.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.