Saturday, September 29, 2012

Faux-Environmentalists, Keystone XL, Bloomberg

Link to Bloomberg.

The story was posted September 25, 2012. I'm not sure why Bloomberg posted the story at this particular time; I'm not aware of anything new.

The president killed Keystone XL.

Keystone XL 2.0 S is tied up in Texas courts.

TransCanada has submitted a new application for Keystone XL 2.0 N, that portion running from the Canadian border (Montana) to Steele City, Nebraska, and from there one branch to Cushing, OK, and one branch to Patoka, IL.

But I digress.

This is the bigger story.
If the aim of opponents was to keep TransCanada from building the 1,600-mile Keystone line, then they have accomplished their mission.

But if the objective was to fight global carbon emissions by hindering the expansion of Alberta’s tar-sands production, then little has changed.

What’s more, a win for Nebraska’s farmers has now dramatically increased the risk to the pristine rainforests along the coast of British Columbia. [I didn't think it had anything to do with the farmers but ....]

Output from Canada’s tar sands, currently about 1.5 million barrels a day, is forecast to double by 2020. Until Keystone was tripped up by the Nebraska aquifer, the project looked like the best option for getting new production to world markets. In the long run, several new pipelines will be needed to handle the extra volume from the tar sands. But in the short term, the competition to build a new line looks like a horse race.

Keystone had the inside track, but the political delay has created an opening for a competitor, Enbridge Inc. (ENB)’s $5.5 billion Northern Gateway that could ship about 525,000 barrels of oil a day from Alberta to a terminus in Kitimat, British Columbia. Regardless of which pipeline gets the nod, once construction begins, the necessity for oil-sands producers to build the other line will be alleviated.

Right now, Canadian oil companies have a huge incentive to fast-track another pipeline out of Alberta. The bulk of the province’s tar-sands output currently ends up in refineries clustered throughout the U.S. Midwest. An increase in volume from the tar sands, combined with prolific production from so- called Bakken shales, a new oil play being exploited in North Dakota and Montana, has created a supply glut at those refineries. 
I can't make this stuff up.

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