Even Without the Keystone XL, That Canadian Oil Will Get to the US

Link here.

EnSys Energy & Systems Inc. and Navigistics Consulting concluded in a report issued as part of the US Department of State’s final environmental impact statement (FEIS) on TransCanada’s proposed Keystone XL crude oil pipeline that it is “almost impossible…to conceive of a situation” wherein the anticipated 1.4 million b/d growth in Western Canadian Sedimentary Basin crude could not be shipped to the US, even if Keystone XL is not approved.

The report, “Keystone XL Assessment—No Expansion Update,” examines three tiers of potential transportation: Tier 1, major new pipeline projects (Keystone XL and Enbridge’s Northern Gateway pipeline to Canada’s west coast); Tier 2, modification-expansion of existing pipelines; and Tier 3, rail, barge, and tanker transport. It notes that as options move from Tier 1 toward Tier 3 the capacity of individual projects drops and the $/bbl transport rate climbs. But it also notes that capital costs, scale of commitment, difficulty in permitting, and time to implement all drop, while available transport options expand.

The EnSys report describes rail alone as being able to provide the additional 1.25 million b/d in WCSB take-away capacity anticipated as necessary by 2030, subtracting 0.15 million b/d as upgraded-in-place. EnSys notes that the roughly 100,000 b/d/year expansion rate required is well below the current 250,000 b/d/year expansion rate currently undertaken in the Bakken shale, and equate to adding just 1-2 unit trains/day/year out of WCSB between 2016 and 2030.

I continue to post stories about the Keystone XL because I know folks are interested in the story, but for me, I've lost interest. The Keystone XL won't be built in my lifetime. If it is started, it won't be completed in my lifetime.

But that's not the reason for posting yet another story on the XL. The reason I posted the story is in the third paragraph. I am noticing that in almost every story that has to do with oil production in North America, the Bakken comes up in discussion.