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Monday, October 18, 2010

Here's One Shovel-Ready Project

No shovel-ready projects, according to President Obama.

This massive project with huge support from the unions is shovel-ready. The pipe is already staged and the crews are already hired. And most of the crews are union. But the government has put the project on hold.

Nancy Pelosi will shut it down.

As noted, I hold shares in ENB and EEP and this can only be great news for Enbridge; both ENB and EEP are up nicely today.  ENB/EEP pipelines "carry the lion's share of Canadian crude exports to the United States." 

Takeaway capacity exceeds production in the Bakken right now (including 10% shipped by rail, and 10% trucked to Canada), so delay will have minimal effect on oil costs in the Bakken. However, pipelines generate a fair amount of income for surface owners and the counties.

UPDATES

Update, October 21, 2010: Many big projects won't happen because no national leadership. No strategic vision. No sense of greatness. I have driven the "Big Dig" in Boston. It was worth it. A $15 billion project and complaints because of one death.

9 comments:

  1. I didn't realize that oil pipelines are a mode for public transportation. Does one ride in it or on it?

    Hess342

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  2. In it, on it, and alongside it. Williams Companies laid fiber-optic cable along their pipeline rights-of-way some years ago.

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  3. So taxpayers paid for the pipeline and can put oil in it?

    Hess342

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  4. That's why I didn't mention anything about the stimulus program, which I assume you are referring to.

    I stick by the links:

    1. Some suggest there are no shovel-ready jobs.
    2. Some suggest the pipeline is a shovel-ready job.
    3. The pipeline project is blocked.

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  5. Congratulations on the clever obfuscation, by the way.

    Hess342

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  6. You're welcome.

    Actually, it's quite funny. When I heard about TransCanada's other pipeline in the Montana/North Dakota area and the governor of Montana holding out for Bakken access to the pipeline, I was quite concerned since I had accumulated a number of shares in ENB over the years. So, with this news that the TransCanada pipeline is DOA, I sleep better at night with regard to my ENB. Funny how things work out.

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  7. For investors only: EEP is back to its pre-spill high, as is ENB. I honestly do not know if there are other factors pushing EEP / ENB back to their 52-week highs, but I have to think that it was the AP story published October 17, 2010, (yesterday) that let investors nationwide know that the Keystone is DOA. Further irony (although "irony" is an overused, and often incorrectly used, word), both TransCanada and ENB are Canadian companies.

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  8. To paraphrase Mr. Twain, reports of its death may be greatly exaggerated.

    I've been impressed by the volume of tar sands oil produced. It now exceeds that of any US state and is approaching the output of our two largest, Texas and Alaska. And while I'm on the subject, recent speculations could move North Dakota ahead of California and Alaska and moving to number one isn't completely beyond the realm of possibility.

    Hess342

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  9. I'm sure you saw my link earlier this morning (a couple posts ago)....

    http://www.calgaryherald.com/business/Tertzakian+industry+could+shake+downward+trend/3687918/story.html

    It alludes, in a way, to what you are saying.

    By the way, I don't have my numbers in front of me, but I think Alaska's production is declining faster than California's but I really don't know.

    The reason I mention that, is because when I'm out in California, I am struck by all the work-over ON-shore rigs along the Pacific Coast Highway. California may be arguing about off-shore drilling, but I think oil companies in California are finding old oil fields might be ready to give up more oil. Again, I'm getting way out of my depth here, but just an observation.

    ReplyDelete

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