Thursday, January 5, 2012

Timing Is Everything -- Why I Love To Blog -- The Bakken, North Dakota, USA

In the last 60 days I have posted a number of stories about Enbridge, the pipeline company, entering the crude-by-rail business.

On January 3, 2011, I wrote about Enbridge and crude-by-rail again

In that post I wrote this:
But the biggest reason, Enbridge got into CBR in the short term? If there is an pipeline oil spill, no matter how small, a) the media blows it our of proportion; b) the EPA shuts down ALL the pipelines that might be related; c) pipelines are not re-opened until the government gives its okay; d) the government won't give its okay until the mainstream media accepts the decision (internal political polling); and, e) a pipeline company can come to a complete stop, affecting a financial quarter's bottom line.

Now, if the government shuts down an Enbridge pipeline, it can still meets it contractual arrangements with its customers.
Now, today, in spades (as some would say), we see why Enbridge got into the railroad business:
US President Barack Obama signed the pipeline safety reauthorization bill into law on Jan. 3. The law, which was developed in the wake of some significant oil and gas pipeline accidents, will not only help keep communities safer, but also provide operators regulatory certainty to run their systems more effectively, US Transportation Secretary Ray LaHood said following the president’s action.

The law gives the US Pipeline and Hazardous Safety Administration stronger enforcement tools and increases civil penalties for pipeline operators who do not meet safety regulations, LaHood said in a posting at his blog at the US Department of Transportation web site. It doubles the maximum fines that pipeline operators face for safety violations, and requires PHMSA to issue new pipeline safety standards requiring operators to install automatic or remote-controlled shut-off valves and excess flow valves in new or replaced transmission pipelines, he said.
And that explains why Enbridge is spreading its risk. 

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