Posted on 01/28/2015 7:05:42 PM PST by shove_it
(Reuters) - Kinder Morgan Inc's (KMI.N) proposed Freedom Pipeline, which would move West Texas crude oil to Southern California, is "getting more interest" from U.S. West Coast refiners, the head of the company's natural gas pipeline unit told analysts on Wednesday.
Unit President Tom Martin said the company "may have a shot" at moving ahead with converting a natural gas pipeline to move crude and condensate to California "if we can get the refiners on board."
The pipeline and logistics company first proposed the $2 billion project in 2012 but shelved it in May 2013 for lack of shipper interest. Martin said on Wednesday that the revamped proposal included adding a facility at the front end in Texas to provide crude blends that better match the Alaska North Slope (ANS) crude that California refineries typically process.
The new proposal also involves shipping ultra-light crude, known as condensate, that could be exported from California, he said during the company's annual analyst meeting...
(Excerpt) Read more at reuters.com ...
ping
Why run a pipeline through territory which may soon belong to Mexico? I wouldn’t put it past some La Raza activists to sabotage the pipeline when it is finally completed.
West Texas to a Gulf port for shipping crude would be a better choice, but that is just my humble opinion.
Refineries on the faults? Let’s think this thru a little. How about the same distance in another direction ! North or east or NorthEast?
That too!
Watermelons’ heads are exploding all over California!
OMG! —— Oil, Pipeline, Big Oil Companies, etc etal.
Great company...one of the better investments I made.
The article goes on to say: “In 2013, Kinder Morgan said the project could be revived if shipper interest warranted. Martin said the original proposal to convert the 740-mile (1,190-km) line to move crude and build more than 200 miles (320 km) of new pipe would have moved West Texas oil that did not match the types that West Coast refiners want.”
It sounds like the pipeline is already there and just needs to be converted and extended. I don’t think we’ll be losing any land to Mexico, especially land with a pipeline on it.
Don't worry Gringo, moonbeam and his environazis will never let a pipeline be built to sabotage!. You see it's contrary to moonbeam and the democraps plan, which is to export wealth and jobs out of California, while importing Latinos as fast as possible
“... I don’t think we’ll be losing any land to Mexico, especially land with a pipeline on it.”
And I never imagined a Muslim Indonesian queer as a U.S. President putting a lock on ANWR oil production!
I have some KM, too...
Unfortunately, a lot of Kinder Morgan projects are going to be on hold for several months, due to low oil prices.
The refineries already exist and operate. This would just replace some of the oil imported by ships from overseas today.
Pipeline projects are not dependent on oil prices. They are dependent on the difference in oil prices between locations and the volumes used.
The West Texas prices are further depressed due to the increased production rates from the Permian basin and associated pipeline bottlenecks moving the surplus to markets. Also with lower prices, gasoline consumption is rising.
Thanks for your response, thackney. I had just read this article in a local paper (White Mountains, Eastern Arizona), so perhaps I was thinking locally and anecdotally. But, for the residents near to this pipe project, this busted their balloons for sure. The tenor of the article, right or wrong, is that the plug was pulled due to falling oil prices, FWIW.
Kinder Morgan pulls plug on CO2 pipeline
Bob Martinson The Independent | Posted: Thursday, January 29, 2015 5:00 am
ST. JOHNS — The hopes and prayers of most people in Round Valley and St. Johns has been to see
Kinder Morgan’s Lobos CO2 pipeline become a reality in the area.
The Independent has confirmed with Bureau of Land Management’s Lobos Pipeline Project Manager
Mark Mackiewicz that the planned development is dead for now. Kinder Morgan, the nation’s fourth
largest corporation and largest energy infrastructure company in North America, said in a press
release that the project is not cancelled but “delayed for the time being given current market
conditions.”
“The project timing is being reassessed due to current market conditions related to the significant
decline in oil prices. KMI will continue to reevaluate the timing of its planned investment of
approximately $1 billion to develop the St. Johns source field and construction of the Lobos Pipeline,
as well as the related expansion of the southern portion of the Cortez Pipeline to accommodate future
required CO2 capacity from St. Johns field,” Kinder Morgan said.
After the loss of the pot ash industry after almost becoming a reality, residents of the area have been
counting on a nearly $1 billion investment from the company to build the pipeline which was to have
originated from between St. Johns and Springerville and would have traveled across New Mexico,
connecting with an existing line into Texas.
That dream is now being “tabled,” according to an email from Kinder Morgan to the BLM manager
who had only about six weeks remaining before an environmental impact statement was to be
completed on the project.
On Jan. 23, Kinder Morgan announced that, as the next step, it has withdrawn its application for U.S.
Bureau of Land Management rightofway review for the proposed Lobos Pipeline.
“Withdrawal of the pipeline rightofway application for the time being will allow us time to
complete the reassessment of the overall project, and we have the option of moving forward with the
application process once we complete our reassessment,” said Jesse Arenivas, CO2 president.
“We have not cancelled the Lobos Pipeline Project, but rather delayed it for the time being given
current market conditions, and Kinder Morgan will continue limited activity in the St Johns source
field. We remain committed to expanding the supply of CO2 for enhanced oil recovery projects and
believe that over the longterm, the markets will support such projects.”
“It’s just devastating news for this area,” said Doyel Shamley, a local resident who was working with
BLM on the environmental assessments. “All those employees that would have been renting or living
in hotels here, the food they would have purchased and who knows how much money would have1/29/2015 Kinder Morgan pulls plug on CO2 pipeline White Mountain Independent: Premium News
http://www.wmicentral.com/news_premium/kindermorganpullsplugoncopipeline/article_bc8d0542a5ba11e4a549371784cd0ee0.html?mode=print 2/2
been spent on supplies to keep their equipment running. It would have all been purchased here.”
Shamley was upset with the fact that the EIS was almost complete.
“They just sent out an email saying it was being tabled,” Mackiewicz said. “I told the company that
they had better put out a press release right away, because we’re going to, letting people know that
their jobs are done. I was really counting on seeing this thing go through.”
Mackiewicz said he was sympathetic to the St. Johns and Round Valley area and knew what it meant
to the local economy. He speculated that the company’s latest acquisition of another company,
Hiland Partners, might not have had a lot to do with it but said the drop in oil prices may have had
something to do with the company’s “evaluating this project and restructuring their plans from
strictly an economic standpoint.”
Kinder Morgan confirmed that statement later Friday evening. Kinder Morgan has been restructuring
since last August and has completed many recent transactions as a result. The purchase of the other
pipeline was announced in the most recent issue of Fortune Magazine.
Reach the reporter at bmartinson@wmicentral.com
That is far different market from all their other pipelines. CO2 is a tiny part of their business. It would be like talking about the business of a single, little spur line that served a single specialty manufacture, while discussing a national railroad system.
Read this article for a better perspective of the whole company rather than a single pipeline.
http://fuelfix.com/blog/2015/01/28/kinder-morgan-charts-course-for-growth-despite-headwinds/
Thanks again for the dialogue. That FuelFix is quite a great looking trade paper!
My thoughts up to now too. However, I am afraid those lovely yields are going to start dropping now that the partnership has devolved into a corporate entity. I still think based on my original price point, it will still retain it's "slot machine atm" status.
I prefer MLPs, REITS, etc. where the payout is mandated beyond a certain point. There are too many CEO’s with bright ideas that have destroyed value or even taken the company down to bankruptcy (Enron, Baldwin United, Borden, etc.).
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