With a $5 Billion Pipeline Project, Canada Looks to Bypass U.S. for Asia


petros
#1
Guess what? MORE pipe! Hooray!!!

CALGARY— Kinder Morgan Energy Partners LP KMP +1.11% said Thursday it will begin a $5 billion expansion of its Trans Mountain pipeline, nearly tripling the capacity of crude oil it can ship to Canada's west coast—the latest project aimed at moving the country's rising oil production to markets outside the U.S.

Currently, almost all Canadian crude exports travel to the U.S. While Canadian oil output has been climbing fast, pipeline capacity to move it from the country's biggest oil patch in landlocked Alberta to U.S. refining markets is stretched.

The resulting glut, and rising oil production in the U.S. itself, has depressed prices for Canadian crude. Canadian government officials, meanwhile, have boosted support for westward-flowing pipelines in order to diversify toward Asian markets. That effort accelerated after the White House earlier this year rejected a big pipeline-expansion project, TransCanada Corp.'s TRP +0.87% Keystone XL, which would have sent more Alberta crude south of the border.

The Trans Mountain line already ships a small amount of crude to Vancouver from Alberta. The expansion will increase that volume to 850,000 barrels a day from 300,000 barrels a day currently. The boost will allow Asian buyers to load Canadian crude in significant volumes in Vancouver and ship it across the Pacific in tankers. The project also envisions an expansion at the pipeline's terminal in Vancouver, which will allow more tankers to take on oil.

In 2011, just 1.65% of Canadian crude exports went to markets outside of the U.S., according to Canada's National Energy Board.

Houston-based Kinder Morgan said demand from customers for space on the line has been strong, triggering a decision to go ahead with the project. Customers have booked 660,000 barrels a day of shipment capacity on the proposed expanded line, said Ian Anderson, president of Kinder Morgan's Canadian division. The company had initially estimated the expansion would cost some $4 billion, but it raised the estimate after deciding to boost capacity.

Mr. Anderson said customers include Canadian oil producers, as well as international refiners and marketers, but he declined to disclose customer names. Kinder Morgan expects to file its application for the expansion with Canada's National Energy Board in later 2013 or early 2014. Construction would begin in late 2015 or early 2016, and oil would flow on the expanded line in early 2017, Mr. Anderson said.

The expansion is competing with other projects to bring Canadian oil to the west coast. Enbridge Inc. ENB +0.39% has proposed the Northern Gateway oil pipeline, which would take oil from Alberta to a small, northern port in British Columbia.

Enbridge's pipeline is expected to cost $5.5 billion and would also be completed in 2017. But that line faces strong resistance from native groups.

Because Kinder Morgan is expanding a pipeline across British Columbia that has been in place for 60 years, it may have an easier time gaining support from native groups, which have significant land claims in the province. The company will expand the line by "twinning" it—building a new pipeline alongside the current one.

Canadian oil executives have sought to open new markets for their crude, especially after the White House rejected the Keystone XL project. The pipeline became ensnared in a political battle in Washington, with environmental groups and many Democrats opposing the pipeline. Republicans embraced it as a way to bolster energy security and create jobs.

U.S. President Barack Obama has said he is open to reviewing Keystone XL again, if TransCanada reapplied for a permit. A decision wouldn't be made, though, before this year's presidential election. Late last month, the government of Canadian Prime Minister Stephen Harper said it would streamline regulatory reviews of big energy and mining projects meant to move resources to markets.Mr. Harper and other Canadian officials have said they want to open up new markets for Canada's resources in China and Asia, instead of relying on the U.S. as its biggest buyer.
 
EagleSmack
+1
#2
Quote: Originally Posted by petros View Post


U.S. President Barack Obama has said he is open to reviewing Keystone XL again, if TransCanada reapplied for a permit. A decision wouldn't be made, though, before this year's presidential election. .

He's got an election to win. He will get more votes by wasting hundreds of millions (or is it billions?) on soon to be bankrupt solar companies than building a pipeline for a known energy source.
 
petros
#3
Quote: Originally Posted by EagleSmack View Post

He's got an election to win. He will get more votes by wasting hundreds of millions (or is it billions?) on soon to be bankrupt solar companies than building a pipeline for a known energy source.

Obama just approved a $5 Million investment in bull**** power. Your Tax Dollars at Work… Obama Commits $5 Million to Go Green With Cow Poop | The Gateway Pundit
 
Sparrow
#4
Canada does need more markets for our resources. We have a lot of other resources beside oil and they also need markets.
 
petros
#5
Quote: Originally Posted by Sparrow View Post

Canada does need more markets for our resources. We have a lot of other resources beside oil and they also need markets.

Oodles and oodles of oil but it's all land locked by 125 year old infrastructure that everyone thinks is the best on the planet for some retarded reason.
 
EagleSmack
#6
Quote: Originally Posted by petros View Post

Obama just approved a $5 Million investment in bull**** power. Your Tax Dollars at Work… Obama Commits $5 Million to Go Green With Cow Poop | The Gateway Pundit

What about algae? Has he dumped money in that yet?
 
petros
#7
Yup. $78 Million in one project and another $24 Million in another project.

U.S. Government Invests $78 Million in Algae Biofuels Research | Popular Science

US Government Makes $24 Million Investment in Algae Biofuel Research | Inhabitat - Sustainable Design Innovation, Eco Architecture, Green Building
 
taxslave
+2
#8  Top Rated Post
The less dependent we are on the US market the better off we are. Now if our governments would just find the balls to stand up to the ecoterrorists we could make lots of money.
 
petros
#9
Keystone and Keystone XL were never intended to supply the US market. Full tankers coming from Middle East to US are to be going to EU with CDN oil so tankers don't sail back empty the whole journey to the M.E.
 
Kakato
#10
I know whos doing this,it's the reason I rented a house in saskatchewan just for work.

I got 50 wells to tie in yet this year and we are only a 10 man crew,one of many working out in Sask as they drill the hell out of the Kindersley and soon Dodsland fields.
Thats the reason we pay $1600.00 rent in a town with a population of 209 that has a guy with a lawn tractor as municipal employee to take care of the town and try clear the roads after a storm.

All this oil has to go somewhere,you cant haul it to the refinery when road bans are on,expect more pipelines.
Last edited by Kakato; Apr 12th, 2012 at 09:25 PM..
 
bill barilko
#11
Paradoxically as these grandiose plans fly thick and fast the supply available to the refinery here continues to rise as supply is bought up by offshore interests.

As a side note have I even mentioned how nauseating the fixation some of you have with the smell of yanqui asshole is?
 
Kakato
#12
Oil is good,it is keeping Canada's economy afloat when the rest of the world is in turm"oil".
You would be hard pressed to find someone whos livelihood did not depend on it so embrace it!
 
Cliffy
#13
Yup! We are awash in oil.



Surf's up!
 
damngrumpy
#14
Even Harper knows the American won't be able to afford the fuel in the future
and the Asians will have cash and in cash we will trust in a tight economy.
 
EagleSmack
#15
Quote: Originally Posted by petros View Post

Keystone and Keystone XL were never intended to supply the US market. Full tankers coming from Middle East to US are to be going to EU with CDN oil so tankers don't sail back empty the whole journey to the M.E.

They were to supply oil companies with oil to do with as they please.
 
petros
#16
Quote: Originally Posted by EagleSmack View Post

They were to supply oil companies with oil to do with as they please.

It's better to keep it in the ground and buy from Arabs.
 
EagleSmack
#17
Quote: Originally Posted by damngrumpy View Post

Even Harper knows the American won't be able to afford the fuel in the future
and the Asians will have cash and in cash we will trust in a tight economy.

Yes Grumpy...Americans will not be able to buy fuel in the future.

Where do you come up with this stuff?

Quote: Originally Posted by petros View Post

It's better to keep it in the ground and buy from Arabs.

Apparently that is true to the current administration.
 
petros
#18
North Dakota, Wyoming and Colorado are in an oil boom but that oil will never be used domestically by America they will only use CDN oil.
 
EagleSmack
#19
CDN and ME oil.
 
petros
#20
Quote: Originally Posted by EagleSmack View Post

CDN and ME oil.

Where will the kerogen go?



 

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