RBN Energy: natural gas pipeline conversion to crude oil pipelines.
The latest Energy Information Administration (EIA) April 2013 short term energy outlook forecasts US crude oil production to increase from an average of 6.5 MMb/d in 2012 to 7.9 MMb/d in 2014. Surging crude production needs to find routes to market – and often competes for pipeline space with growing Canadian imports. New crude pipelines are taking too long to build. At the same time many natural gas pipelines are flowing far beneath capacity because new gas production nearer to market makes them redundant. Converting these natural gas pipelines to crude oil use where geography allows is a potential win-win. Today we look at gas to crude pipeline conversion economics.
- Pipelines discussed:
- Pony Express Pipeline (PXP)
- Trunkline (Energy Transfer Partners)
- Kinder Morgan Freedom Pipeline Project
- TransCanada Energy East Project
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