Saturday, April 13, 2013

American Crystal Union Approves Contract

See earlier post.


Note: Crude Oil and Natural Gas Pipelines in North America: A Barrel Full



February 3, 2020: Enbridge Line 3 replacement -- last hurdle cleared?

October 19, 2019: the Bridger Expansion -- huge;

May 1, 2018: Gray Oak Pipeline -- the Permian to Corpus Christi. One million bopd.

November 20, 2017: Nebraska regulators vote "no" with a 3-2 "yes" vote to approve the Keystone XL.

March 27, 2017: DAPL pipeline oil under the lake.

November 28, 2016; huge, huge, huge story. Spectra Energy to expand pipeline capacity from Guernsey, WY, to Patoka, IL

November 25, 2016: US Army Corps of Engineers closes the protest camp north of the Cannonball River.  ND state attorney rules in favor of DAPL; Trump sells shares of ETP.

September 5, 2016: more reporters than protesters, but over at CNN, the report is that it's getting more tense in North Dakota over the Dakota Access Pipeline; Native Americans ask for "emergency" injunction against any more construction. Link to CNN; the link will eventually break. 

September 2, 2016: Enbridge puts the Sandpiper Pipeline project on hold

August 29, 2016: Dakota Access Pipeline keystoned by the Lakota in Dakota

August 5, 2016: Sandpiper in doubt. MRO pulls out; Enbridge re-evaluates. Emphasis now on Dakota Access. 

May 27, 2016: Dakota Access Pipeline keystoned in Iowa, as predicted

April 19, 2016: when Iowa approved the Dakota Access pipeline permit, it also approved use of eminent domain. As expected, a lawsuit has been filed to prevent that use of eminent domain (as of April 12, 2016). 

April 11, 2016: Iowa formally issues Dakota Access pipeline permit -- Dickinson Press.

January 20, 2016: North Dakota approves Dakota Access Pipeline. Only Iowa yet to approve, which the company expects "next month." US Army Corps of Engineers also have to approve portion that goes under Missouri River.

December 9, 2015: update on TransCanada's Upland Pipeline project and ETP's Dakota Access Pipeline project staging areas west of Williston.

November 30, 2015: South Dakota approves its segment of the ETP Dakota Access Pipeline, but one dissenter suggests it will end up in court.

October 19, 2015: RBN begins series on Enbridge Line 9 reversal and what it means for the Bakken.

October 10, 2015: Two stories from Argus Media on Enbridge Line 9: good news in the big scheme of things. Some ankle biters by NIMBYs. 

August 31, 2015: Van Hook Gathering System, bought by Ares in 2015, built by WPX. 
August 10, 2015: KMI announces crude oil starts to move on Double H

January 17, 2015: one last line of defense to stop Enbridge Line 61 expansion

January 14, 2015: open comment period on the northern portion of the BakkenLink, from Tioga/Hess to Watford City.

June 25, 2014: North Dakota PSC approves the Enbridge Sandpiper pipeline. Minnesota and Wisconsin still need to act, I believe.

October 31, 2013: mostly fluff, but The Motley Fool briefly updates the major pipelines of interest
By 2014 the United States of America will overtake Russia in liquids production, which is estimated to hit 11 million barrels per day versus 10.86 million bpd for Russia. But the bigger question is how will America move 40 billion barrels a year?

Well up north Enbridge Energy Partners is lending a helping hand with several projects coming up. The Bakken is seeing booming production, and someone has to be able to transport all that oil to the refineries.  
Enbridge Energy Partners is building a 225,000 bpd pipeline from the Bakken to Clearbrook, Minnesota. From Clearbrook, Enbridge Energy Partners is building a 375,000 bpd pipeline to Superior, Wisconsin. Both of these projects will be done around 2016 and will allow oil from the Bakken to reach refiners out east.
In order to make sure as much oil as possible is hooked up to Enbridge Energy Partner's pipelines, it is building a 100,000 bpd regional access system which will come online in the third quarter of 2013.
August 25, 2013: Wall Street Cheat Sheet provides background to three pipelines that are as "environmentally dangerous" as the Keystone XL according to activist environmentalists (some of them noted below): a) the Bluegrass Pipeline; b) the TransCanada's Energy East Pipeline (entirely within Canada, skirting Maine); and, c) Enbridge's Eastern Gulf Crude Oil Access Pipeline. 
  • Bluegrass Pipeline: across Kentucky; 500 miles; natural gas; from western border of Pennsylvania to Arkansas, where it will connect with existing line to the Gulf
  • Energy East Pipeline: most expensive TransCanada project ever; $12 billion; converting 1800 miles to natural gas pipeline to handle crude oil
  • Eastern Gulf Crude Oil Access Pipeline: 770 miles, crude oil, Illinois (Patoka/Johnsonville) to Louisiana
August 9, 2013: The Financial Post provided an incredible update of 37 pipelines planned or under construction in the United States, while President O'Bama dithers with regard to Keystone XL. 

My List 

Liberty Pipeline

First mention here (link here):
  • Liberty Pipeline, a joint venture between two companies:
    • Phillips 66
    • Bridger Pipeline
  • The project:
    • origin: the Bakken; southwest corner of North Dakota
    • via: Guernsey, WY
    • terminal: Cushing, Oklahoma
    • route not yet clear
    • proposed capacity: 200,000 bbls
    • cost: $1.6 billion
  • in-service date: as early as 1Q21 (hope springs eternal)
Bakken Pipeline System

Two legs (link here):
  • Dakota Access Pipeline (see below)
  • Energy Transfer Crude Oil Pipeline
Dakota Access Pipeline

Data points:
  • Completed:
  • Length: 1,168 miles; 30-inch diameter
  • Origin: 
  • Terminal: 
  • Capacity: 450,000 bopd; max, 570,000 bopd
  • Cost: $3.7 billion project per ETP; $1 million/mile = $1.1 billion
  • Comment: ETP hopes to have this completed by late 2016; update -- Iowa keystoned the project in early 2016;
Enbridge BakkenLink: Beaver Lodge (Tioga) to Fryburg (southwestern ND)
North Portion: under the river/lake, Beaver Lodge to Johnson Corner (Watford City)
South Portion: Johnson Corner to Fryburg, about 35 miles west of Dickinson, ND

Update here.

Data points:
  • Completed:
  • Length: 
  • Origin: Beaver Lodge (Tioga)
  • Terminal: Fryburg, ND, via Johnson Corner (Watford City)
  • Capacity:
  • Cost:
  • Comment: northern portion will set depth/distance record for horizontal/direction pipeline

TransCanada Upland: Williston-to-Canada
Initial post: February 14, 2015
Rigzone: April 27, 2015

Data points:
  • Status: permit request to President Obama, April, 2015
  • Completed:
  • Length: 240 miles
  • Origin: Williston, North Dakota
  • Terminal: Manitoba/Saskatchewan border to meet the proposed TransCanada Energy East pipeline
  • Capacity: 220,000 bopd (remember the Keystone XL was going to have about 850,000 bopd capacity and very little of that would carry Bakken crude oil)
  • Cost: $500 million

Energy Transfer Partners (ETP): Bakken-To-Patoka, IL
Dakota Access Pipeline

Announced: June 26, 2014 (story here)
Anticipated completion: 4Q16
Note: "replaces" Koch Bros "Dakota Express"

Updates: South Dakota approves its segment, November 30, 2015; North Dakota approves, January 20, 2016; Iowa last state, expected to approve "next month (February, 2016)"; US Army Corps of Engineers need to approve that portion under the Missouri River

Data points:
  • "Go-By Name": Dakota Access Pipeline
  • Completed: March 27, 2017: DAPL pipeline oil under the lake.
  • Length: 1,150 miles
  • Origin: North Dakota
  • Terminal: Patoka, IL
  • Capacity: 320,000 bopd (remember the Keystone XL was going to have about 850,000 bopd capacity and very little of that would carry Bakken crude oil); in January 20, 2016, update, the pipeline was said to be able to carry 600,000 bopd
  • Cost: $3.8 billion;
EPD: Bakken-To-Cushing 

Data points:
  • Announced: June 24, 2014 (story here)
  • Anticipated completion: 4Q16
  • Completed:
  • Length: 1,200
  • Origin: Stanley, ND
  • Terminal: Cushing, OK
  • Capacity: 30-inch diameter; 340,000 bopd (remember the Keystone XL was going to have about 850,000 bopd capacity and very little of that would carry Bakken crude oil)
  • Cost: [my estimate: 1200 miles x $400K/mile = 480,000K = $480 million]
  • Impact: huge; if I recall correctly, OKE proposed something similar but canceled plans

Belle Fourche Pipeline #2, Billings County To Dickinson, North Dakota

Data points:
  • Announced: June 18 2014 (story here); to parallel an existing Belle Fourche pipeline
  • Anticipated completion:
  • Completed:
  • Length: 20 miles
  • Origin: southeast Billings County
  • Terminal: MDU/Calument refinery / CBR west of Dickinson
  • Capacity: 100,000 bopd (about 15% of the Bakken output)
  • Cost: $8 million
  • Impact: huge; another 100,000 bopd for the refinery and CBR; complements the Killdeer-Dickinson line; parallels an existing pipeline

Data points:
  • Unofficial "Go-By" Name:
  • Announced: 2013
  • Originator: TransCanada
  • Pipeline: crude oil
  • Specs: 
  • Origin: most likely, Hardisty, Alberta, Canada
  • Terminus: Montreal, Quebec City and Saint John, N.B.
  • Length:
  • Capacity: 850,000 bopd (original post); January 7, 2014, according to RBN Energy: 1.1 million bopd
  • Comments: alternative to Keystone XL if disapproved; could be in addition to Keystone XL if the latter is approved; Energy East also would displace foreign crude. About half of the crude oil that would flow through the pipeline would be destined for export markets, with the remainder processed at domestic refineries. Refineries in the northeastern U.S., Europe and India’s west coast are possible customers for Energy East’s crude.
  • Concerns:
  • Status: $11 billion project application formally filed October 30, 2014; link here to WSJ

Line 9A Reversal
Line 5 Expansion
Line 79
Western Canada to Montreal, Quebec 

Update: project completed, October 19, 2015.

Update: apparently regulators have given Enbridge approval to open its Line 9 crude pipeline. October, 2, 2015. Story here.
  • Line 9A, reversal, from Sarnia, Ontario, (northeast of Detroit) to North Westover, Ontario: about 120 miles; should be complete by early-2014; 200,000 bopd
  • Line 9B: reversal already approved; 
  • Line 5, expansion, Superior, MN, to Sarnia, Ontario: should be completed early this year
  • Line 79, new, between Stockbridge and Romulus, MI; 50-mile stretch west of Detroit; enters service April, 2013; new pipe and existing leased pipe
  • Line 6B (Lakehead), replacement work, between Griffith, IN, and Stockbridge, MI: 200 miles west of Stockbridge; done by end of 2013; Stockbridge, MI, to St Clair River in Marysville, MI, 350 miles running from south, up to Stockbridge, MI; done by early 2014; [seems like two separate lines, one running west to east (Bakken); one running south to North (Cushing)]; Line 6B Phase 2 replacement; replace 75 miles of old pipe; full pipeline will have replaced (sic) once Phase 2 is complete, increasing capacity to 500K bopd from 240K bopd.
  • Line 62, expansion, Spearhead North Pipeline, from Flanagan, IL, to terminal at Griffith, IN: to 235K bopd from 130K by adding horsepower.  (Flanagan, IL: southwest of Chicago; out in the middle of nowhere)
A new 330K bbl storage tank to be built at Griffith to existing storage

 Enbridge Light Oil Market Access Program
Western Canada to Montreal, Quebec

Update, September 2, 2016: formally on hold

Update, August 5, 2016: looks to be in trouble; MRO pulls out; Enbridge to re-evaluate need;

Update: Minnesota activists are attempting to keystone the Sandpiper; could be successful; both parties want Minnesota Supreme Court to rule, Octobber 19, 2015.

Comment: this is a key line taking Bakken to Superior, MN, where it would hook up with Line 5, to get crude oil back into Canada. (Map here; though regional media source; link will probably break)

Unofficial "Go-By" Name:
Expected completion: 2016
Originator: Enbridge
Pipeline: crude oil
Specs: $2.6 billioin
Origin: Beaver Lodge Terminal, Tioga, North Dakota
Terminus: Superior, WI, Terminal via Clearbrook, MN
Length: 600 miles
Capacity: 225,000 bopd (approx 20% of Bakken output)
Concerns: northern Minnesota activists in Clearbridge area
Status:  initial application was not approved by FERC in March, 2013; Enbridge says project remains on schedule.  Update, October 29, 2013: The Bismarck Tribune reports that the Minnesota PUC will take a year to listen to local farmers who oppose the pipeline. Update: June 25, 2014: North Dakota PSC approves the pipeline. Update: June 5, 2015: Minnesota approves certificate of need for the pipeline; lengthy review for route still envisioned. Update: October, 2015: court nullifies PUC certificate of need; both parties now want Minnesota Supreme Court to intervene;

 Southern Access Extension Pipeline
Will connect ENB's huge Lakehead system running from Western Canada to Flanagan, IL, with EGCAP (Energy Transfer) in Patoka, IL

A short pipeline between Flanagan, IL, and Patoka, IL (connects pipeline from the Gulf Coast to a pipeline from western Canada)

Flanagan South

Comment: will get heavy oil to Gulf Coast; Enbridge: "will provide the additional capacity needed to bring increased North American crude oil production to refinery hubs in the U.S. Gulf Coast"; Chicago area to Cushing where it will hook-up with reverse Seaway to get oil to Gulf coast.
Unofficial "Go-By" Name:
Originator: Enbridge
Pipeline: heavy crude oil
Specs: 36-inch diameter
Origin: Flanagan, IL
Terminus: Cushing, OK
Length: 600 miles
Capacity: 600,000 bopd, initially
Comments: will parallel Enbridge’s existing Spearhead crude oil pipeline right-of-way; does not go through Nebraska
Status: should be on-line sometime in 2014

Line 61 Upgrade Project
Two Phases

Phase 1: increasing the capacity on Line 61 (referred to as Southern Access Project during its construction in 2007) between Enbridge’s Superior, WI, Terminal and Flanagan Terminal near Pontiac, IL. The Line 61 Project expands the capacity of the 42-inch pipeline from 400,000 bpd to 560,000 bpd.

The construction of Phase 1 Project was completed in the summer of 2014, allowing the 560,000 bpd capacity to begin flowing September 2014.

Phase 2: Enbridge is expanding the average annual capacity of Line 61 from 560,000 barrels per day (bpd) to 1.2 million bpd. Enbridge is expanding in phases the average annual capacity of our Line 61 Pipeline to an ultimate 1.2 million barrel per day (bpd) design capacity. Line 61 is a 42-inch-diameter crude oil pipeline that spans from Enbridge’s terminal in Superior, Wisconsin, to our Flanagan Terminal near Pontiac, Illinois.
  • Phase 2 will increase Line 61 to its full 1.2 bpd design capacity
To increase Line 61’s capacity to its full 1.2 million bpd design capacity, Enbridge is constructing or modifying pump stations located in Wisconsin and Illinois.

All work will be performed on property that is owned or acquired in fee by Enbridge.  The Project does not require pipeline construction.
Construction for Phase 2 began in spring 2014 and, subject to permit and regulatory approvals, the pipeline will be operating at a capacity of 1.2 million bpd in 2015.

This is simply an upgrade in pumping stations. 

Harold Hamm/CLR/Hiland

Unofficial "Go-By" Name: "Double H"
Announced: April, 2013
Owner: both Hiland and Double H acquired by Kinder Morgan in 2015
Originator: Harold Hamm, Hiland Partners; Continental Resources
Pipeline: crude oil
Specs: 12"
Origin: Dore, Fairview, ND
Terminus: Guernsey, WY, via Baker, MT
Length: 462 miles
Capacity: 50 K with expansion to 100K
Comments: depends on Pony Express Pipeline
Concerns: close relationship between CLR and Hiland -- WSJ; August 10, 2015: KMI announces crude oil starts to move on Double H
Status: see this post.

Specta Energy Expansion -- Guernsey, WY, to Patoka, IL
Announced November 28, 2016

Link here. In light of the DAPL issue, this makes perfect sense.

New Town Expansion

Announced September 18, 2015
Purpose: conversion of an existing gathering line to a transmission line
Owner:  Kinder Morgan
No new pipeline; some new above-ground structures
Cost: $15 million
Pony Express Pipeline

Unofficial "Go-By" Name:
Announced: ? -- in conjunction with the "Double H" pipeline (April, 2013)
Originator: Tallgrass Pony Express Pipeline, LLC
Pipeline: natural gas pipeline being retrofitted to carry crude oil; 260-mile new pipeline (KS to OK)
Specs: 24" 
Origin: Guernsey, Wyoming
Terminus: Cushing, Oklahoma
Capacity: 230K to 320K
Comments: will transport Bakken oil to Cushing, Oklahoma; announced about same time as "Double H": at time of announcement, approval of the Keystone XL permit was still questionable;
Update: July 24, 2013, at


Unofficial "Go-By" Name:
Announced: April 9, 2013
Originator: CNP, XTO
Origin: in-state
Terminus: in-state
Capacity: 19.5K
Comments: an in-state crude oil gathering pipeline system

Unofficial "Go-By" Name:
Announced: May 30, 2013; open season announced January 30, 2014;
Cost: $700 million
Originator: MDU subsidiary MBI
Pipeline: natural gas
Origin: in-state (western North Dakota, Bakken)
Terminus: northwest Minnesota
Length: 325 miles (in open season announcement, said to 375 miles)
Capacity: 400 million cfd; could expand to 500 million cfd (could heat 1.3 million homes annually)
Comments: energy for Minnesota; feedstock for new fertilizer plants in North Dakota (Jamestown, GR)
Status: open announced January 30, 2014; if successful; construction, 2016; on-line, 2017

Enbridge's Alberta Clipper
AKA: Line 67

February 13, 2017: update.  We're talking a 3-mile section of pipeline. For oil that is already crossing the border. 

January 25, 2015: update.

November 13, 2014: it looks like Enbridge is playing "chicken" with US State Department.

August 25, 2014: did the US State Department approve Enbridge 67 "expansion"?

Enbridge Clipper: 800,000 bopd; Hardisty, Alberta (Canada) to Wisconsin (US). Received US permit in 2009; everything green-lighted; on February 14, 2014, it was announced that the US State Department wants a "do-over" on the environmental impact study.

June 13, 2014: update. See Flanagan South above.



Van Hook Gathering System, bought by Ares in 2015, built by WPX. 

The Natural Gas Canadian/US Alliance Pipeline
Tesoro's Bakken Area Storage Hub (BASH), expansion, announced February 4, 2014.


Killdeer - Highway 22 - Dickinson, North Dakota
 Bakken Oil Express

Announced: December 28, 2013
Anticipated completion: early 2014
Completed: July 1, 2014 (story here)
Length: 38 miles
Origin: Killdeer, North Dakota (two miles west of Killdeer)
Terminal: Dickinson, North Dakota (four miles west of Dickinson)
Capacity: 165,000 bopd (about 15% of the Bakken output)
Cost: $14 million
Impact: huge; essentially connects the southern one-half of the entire Bakken, from Williston south to Dickinson

Bakken NGL Pipeline

Completion announced April 10, 2013
Unfractionated NGL from the Bakken to the Overland Pass Pipeline; 525 miles, $500 million
Overland Pass Pipeline: 760 miles; southern Wyoming to Conway, KS

Keystone XL 2.0

Began flowing: January 22, 2014
Cushing to Gulf coast: completed, December, 2013
Filling pipeline, late December
To start flowing January 22, 2014



Dead. Killed by President Obama.

Data points:
  • Unofficial "Go-By" Name:
  • Announced: 2008
  • Originator: TransCanada
  • Pipeline: crude oil
  • Specs: 
  • Origin: Hardisty, Alberta, Canada
  • Terminus: Steele City, Nebraska
  • Length:
  • Capacity:
  • Comments:
  • Concerns: political
  • Status:  in purgatory. In May, 2013, the government said don't expect decision until March, 2014;
  • April 18, 2013: US Dept of State hearings in Grand Island, NE; locals and activists from out-of-state have converged; if approved, some locals and activists have promised significant civil disobedience.
Keystone XL 2.0
Dead. Killed by President Obama.

Kinder Morgan
Permian to California 

Dakota Express

Anticipated operational date: 2016
Capacity: 250,000 bopd
Terminals: western North Dakota (Bakken) to Patoka, IL, hub

American Crystal "Workers" Are Voting Today; Approved

Update, 10:30 pm: approved.

Original Post
StarTribune is reporting.

From an earlier post:

The union:
The union: Bakery, Confectionery, Tobacco & Grain Millers union (BCTGM). Where I have I heard that name before? Here it is: this is the Hostess/Twinkie union -- the Bakery, Confectionery, Tobacco & Grain Millers union (BCTGM). Hmmmm.
By federal law, replacement workers are deemed temporary in a lockout; so union members would go back to work if they approve Crystal's contract offer. Still, a "return-to-work" agreement must be negotiated, and talks over that could get tricky, too. 

Week 15: April 7, 2013 -- April 13, 2013

The Big Picture
Random update of the three basins: Permian Basin, Western Gulf Basin, and the Williston Basin
Random data points on the oil industry

CBR vs pipeline: for Enbridge, it's worse than one thinks
CBR expansion at New Town planned
CNP contracts with XOM-subsidiary XTO to build crude oil pipeline; also reported here

OXY USA may hold record for one of the lowest-reported Bakken IPs (23)
CLR to provide additional oil to Delaware City Refinery

Not a significant factor in causing earthquakes; if anything, gradually releases the pent-up stress/energy
"Fracking Sand 101" in La Crosse, Wisconsin
Produced water

Economic notes
Developers propose new city at 13-mile corner: "Bakken Village": that area is already more populated than 90% of most urban centers in North Dakota
ONEOK announces completion of projects ... and announces more projects
Bobcat, bigger than ever, back in Bismarck
Feel-good story on the refinery story in North Dakota

WPX has big natural gas well in the Niobrara; and that's the problem -- natural gas
A little perspective: the myth of US independence
Bonanza Creek discusses the Wattenberg Field, Niobrara Shale, Denver Basin
Norway misses oil output targets; previously reported -- Statoil's concerns re: new fields
Some people actually suggest the boom may end some day
Saudi Arabia and the "Red Queen"
Natural gas flared from one huge well in North Dakota

Unprecedented Opportunities in The Arctic Risk Another Cold War

The New York Times is reporting:
JUST a quarter-century ago, and for millenniums before that, the Arctic Ocean was covered year-round by ice, creating an impregnable wilderness that humans rarely negotiated. Today, as the effects of global warming are amplified in the high north, most of the ocean is open water during the summer and covered by ice only in the winter. 
This unexpected transformation has radically altered the stakes for the Arctic, especially for the eight nations and indigenous peoples that surround it. But while there has been cooperation on extracting the region’s oil, gas and mineral deposits, and exploiting its fisheries, there has been little effort to develop legal mechanisms to prevent or adjudicate conflict. The potential for such conflict is high, even though tensions are now low.  
Several countries, along with corporations like ExxonMobil and Royal Dutch Shell, are preparing to exploit the region’s enormous oil and natural gas reserves. New shipping routes will compete with the Panama and Suez Canals. Vast fisheries are being opened to commercial harvesting, without regulation. Coastal areas that are home to indigenous communities are eroding into the sea. China and the European Union are among non-Arctic governments rushing to assert their interests in the region. Some states have increased military personnel and equipment there.
The most fundamental challenge for the Arctic states is to promote cooperation and prevent conflict. Both are essential, but a forum for achieving those goals does not yet exist. 
At least, it appears, the NY Times has quit worrying about the polar bears. 

Arctic Could Be Pretty Much Ice-Free For Shipping By 2050; Incredible Opportunities; The Fabled Northwest Passage; The Northern Route, Now 40% Shorter Than Southern Route (Suez Canal) Would Be An Additional 20% Shorter

RedOrbit is reporting:
“We’re talking about a future in which open-water vessels will, at least during some years, be able to navigate unescorted through the Arctic, which at the moment is inconceivable,” said co-author Scott R. Stephenson, a PhD candidate in the UCLA Department of Geography.
Smith and Stephenson go on to predict the Arctic ice sheet will have thinned to such a point that icebreakers will experience little resistance as they sail between the Pacific and Atlantic oceans directly over the North Pole.
“Nobody’s ever talked about shipping over the top of the North Pole,” Smith said. “This is an entirely unexpected possibility.”
The ability to ship on a route passing directly over the North Pole would shorten a ship’s journey by a full 20 percent when compared to traveling the currently most-trafficked Arctic shipping lane, the Northern Sea Route. This route follows closely the coast of Russia. The Northern Sea Route is a preferred route by many shippers as it is approximately 40 percent shorter than the southern shipping route that travels through the Suez Canal.
The other side of the Arctic Ocean contains the fabled Northwest Passage. This route, just to the north of the Canadian coastline, is the most direct route from Asia to North America. Though this passage is known for its harsh and unforgiving conditions, the team expects the route will be navigable by Polar Class 6 vessels which have been strengthened against ice. The situation may even be favorable for vessels with reinforced hulls. The bulk of the world’s commercial fleet is already built with reinforced hulls.

Update on the Sandpiper Pipeline; Role of Clearbrook; Impact of Rail

PN Bakken is reporting, via Clearbrook Newswire:

A lot of interesting data in that article; the article explains why Bakken was trading at a discount to WTI earlier.

The Enbridge permit request for the Sandpiper project has been disapproved but Enbridge says that minor detail will not slow down its plans, or completion date. I guess Enbridge has not read the Keystone XL story. The Keystone XL foundered when folks figured out what "XL" stood for. As soon as I saw Enbridge use the phrase "unified system" it gave me the willies. US regulators are all concerned about "too big to fail." Enbridge would be better served to market the Sandpiper as a small but necessary pipeline, a backup pipeline in case of a terrorist attack by an American right-wing nut on existing crude oil pipelines and get the backing of Homeland Security. But I digress. 

Some data points:
  • some (probably the folks at Clearbrook) say the role of the crude oil hub at Clearbrook, MN, would be lessened if the Enbridge Sandpiper is project approved/built
  • the Sandpiper hub at Superior, WI, would negate the need for the one at Clearbrook, MN
  • Sandpiper proposed capacity: 600,000 bopd
  • Sandpiper is part of Enbridge's Light Oil Market Access program, which would provide a unified system to carry crude from the Enbridge North Dakota system to a new connection with its Lakehead System at Superior
  • Two pipelines: a) $2.5 billion Sandpiper link from Beaver Lodge, ND, to Clearbrook, boosting capacity from 224K to 435K; b) the other,  Clearbrook to Superior, initially at 375K
  • the report is a bit confusing, but it sounds like pipeline limitations "have seen deliveries from the Enbridge system at Clearbrook from about 93K bopd from 210K causing a decline in spot trading."
  • Bakken crude is being delivered to Clearbrook at less than half of volumes at the hub in mid-2012
  •  a spokesman says crude is being delivered to Clearbrook mostly to protect pipeline space in case the market recovers
  • the article says Enbridge Energy Partners reported that Bakken volumes decreased 16 percent in 4Q12 from a year earlier due to rail shipment of crude oil
  • a rail shipper collects better netbacks than on pipe
  • CBR: $17 - $19/bbl to the Atlantic Coast
  • CBR: $13 - $16/bbl to the Gulf Coast
  • I could be wrong, but I believe pipeline is $2 - $5/bbl
  • CBR: accounted for 68% of Bakken production in January, 2013; 64% in December, 2012
  • Pipelines: 23% of Bakken production
  • Tesoro refinery in Mandan: 13% (the refinery: 58,000 bopd)
I still remember the anonymous comment I received months ago suggesting rail was temporary and a flash in the pan. Almost 70% of Bakken crude is carried by rail, and the percentage is higher when one removes the Bakken crude that stays in-state (Tesoro refinery), and despite all the pipeline being laid, the percent may be increasing. 

Saturday Morning Links

Active rigs: 186 (steady)

Rigzone is asking whether US shale means a dose of Dutch Elm disease?

The US is probably giving up on the Arctic, but not Russia. The world's largest oil company, Rosneft, will invest $1.5 billion in the Arctic shelf. Rigzone is reporting:
The world's largest listed oil producer, Russia's Rosneft, plans to invest $1.5 billion to survey the East Arctic shelf, deputy general director at Rosneft-Shelf-Far-East said Friday, Interfax news agency reported.

WSJ Links

Section D (Off Duty): Later

Section C (Review):
  • Can cancer cells solve the puzzle of junk DNA? The article certainly had nothing to do with the headline.
    Yet—and here's the source of the controversy—the HeLa cell line was derived from the tumor that killed a poor, black tobacco farmer named Henrietta Lacks in Baltimore in 1951. As Rebecca Skloot has documented in a remarkable best seller ("The Immortal Life of Henrietta Lacks"), the medical community never got her consent and treated her family with tactless disrespect for years—until Ms. Skloot's book began to make a difference. [I read the book twice; somehow I'm not sympathetic to the plaintiff's complaint, but I'm probably the only one. Right, wrong, indifferent, the HeLa controversy surrounding privacy and ownership certainly have nothing to do with junk DNA and cancer in the sense that the headline might have led some of us to believe. Having said that, it's a great little book, but about twice as long as it needs to be; but if it was half the length it is, it would not be a book; it would be a pamphlet.]
    Not enough of a difference, apparently. The German team did not seek the consent of the Lacks family before publishing the HeLa sequence, claiming it revealed nothing specific about Ms. Lacks's own genome. "Your claim is so wrong that I don't know where to start," replied one geneticist. The sequence has since been unpublished.
    So here's the paradox: A cancer genome like HeLa may not be sufficiently representative of human genomes to resolve the junk DNA question, but may still give away private information about the human being from whom it derived.
  • Turkeys with teeth. Everything you learned as a child about dinosaurs is wrong. Sam Kean reviews Brian Switek's My Beloved Brontosaurus.
  • Does the moon exist when I'm not looking at it. At 38 -- well past the age when physicists peak -- Erwin Schrodinger changed science with a sudden burst of creativity. Gino Segre reviews John Gribbin's Erwin Shrodinger and the Quantum Revolution. A timely book. And John Gribbin is one of the best in this genre. Very timely: I am reading David Bodanis' biography of the world's most famous equation, e=mc2, with my granddaughter.
  • How Hello Kitty conquered the world. The cutesy Hello Kitty character came to be popular with everyone from small children to motorcycle gangs. Meghan Keane reviews Christine R. Rano's Pink Globalization.
Section B (Business & Finance):
  • Judge denies Macy's request to temporarily block the sale of some Martha Stewart-designed products at JC Penney. Probably won't matter.
Section A:
  • Pension plan would hit retirees: A coalition of unions and employers is proposing changes to the federal law that governs the pension plans of about 10 million people, including reducing benefits paid to retirees, the first time in four decades that such cuts would be allowed.
  • Back-tax hit sparks fury. I guess. Wow, this will hurt. Twenty years of back taxes? Small startup companies in California are fighting the state's decision to tax them retroactively after a 20-year-old tax incentive was found unconstitutional. A great state to build a business: California. Not.
  • Everybody must pay their fair shares. President's tax rate: 18%. President Obama and the first lady paid $112,214 in federal income taxes in 2012 on adjusted gross income of $608,611, an effective rate of 18.4%. Bakken millionaires probably pay a bit more. Just a hunch.
  • A lot of stories on the Korean Missile Crisis. This story just doesn't have the same intensity as the Cuban Missile Crisis. Sequels never do.
  • Sports: everyone agrees. Penalizing a 14-y/o amateur at the Masters was incredibly dumb. But then again, these guys didn't allow women for decades. There are going to be a lot of fans in the gallery today holding up stopwatches when Tiger Woods starts playing.