Must-Read For Tuesday: Keystone XL South Has Been Completed, Ready To Begin The "Line Fill" -- Expediting Bakken Oil To The Coast

Active rigs: 192

RBN Energy:  Keystone XL South is complete, ready for the "line fill."

So far in 2013 around 645 Mb/d of new crude oil pipeline capacity has opened up to ship supplies to the Texas Gulf Coast. Early this month (December) line fill starts on the largest new capacity addition to date – the 700 Mb/d Keystone Gulf Coast Pipeline. The new pipeline runs from Cushing to Port Arthur and will carry mostly Canadian heavy crude. Today we wonder if all that crude will find a home.

The first episode in this series described 4 MMb/d of current and planned expansions to crude transportation capacity into the Texas Gulf Coast region. Our analysis showed that the new incoming light crude capacity will exceed Texas Gulf Coast demand by somewhere north of 0.5 MMb/d by the end of 2015. In episode two we described how some of these excess crude supplies would move east on the reversed Ho-Ho pipeline. In episode three we looked at how shippers could divert supplies away from Texas Gulf Coast congestion. This time we consider the impact of the Keystone Gulf Coast pipeline.

One of the more confusing features of the Keystone Gulf Coast Pipeline is what to call it – the name seems to change in real time. That is probably due to a desire to disassociate the southern Gulf Coast section of the pipeline from delays in permitting the Canada to US Keystone XL pipeline. Owner and operator TransCanada most recently set up a subsidiary to operate the pipeline called Marketlink LLC and it should now apparently more properly be called the Cushing Marketlink Pipeline so we will go with CMP as an abbreviation.

The 36-inch-diameter CMP runs 485 miles from Cushing, OK, to Nederland, TX. The line will have an initial capacity of 700 Mb/d with the option to expand to 830 Mb/d. It is almost ready to commence operations but before that can happen it has to be filled with oil – a process known as “line fill”. We described how line fill works and provided a formula to approximate the volume of oil required back in May 2012. According to that formula CMP requires 3.5 MMBbl of line fill. Marketlink LLC has said the first pipeline deliveries will be made before the end of 2013. The company is also constructing a 48-mile Houston Lateral pipeline (orange line on the map) that will run from the Liberty pumping station to East Houston and should be online by the end of 2014 with 130 Mb/d capacity.

So much more at the linked story, including maps. I will probably do a stand-alone post on this later. 

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 The "Caca" Continues

Yesterday I posted a screenshot of a "bronze plan" that meets the ObamaCare requirements. Anthem Blue Cross/Blue Shield codes it: "caca." Today, I see the headline story in The New York Times -- front page, top right, lead story -- "As Hospital Prices Soar, a Single Stitch Tops $500."

On a quiet Saturday in May, nurses in blue scrubs quickly ushered the two patients into treatment rooms. The wounds were cleaned, numbed and mended in under an hour.

“It was great — they had good DVDs, the staff couldn’t have been nicer,” said Emer Duffy, Orla’s mother. 

Then the bills arrived. Ms. Singh’s three stitches cost $2,229.11. Orla’s forehead was sealed with a dab of skin glue for $1,696. “When I first saw the charge, I said, ‘What could possibly have cost that much?’ ” recalled Ms. Singh. “They billed for everything, every pill.” 

ObamaCare was not mentioned. No, there are no cost controls under ObamaCare. The stories will only get worse. 

For the archives.