key2thecup Posted February 24, 2015 Share Posted February 24, 2015 Keystone XL bill vetoed by Barack Obama, despite approval by Congress U.S. President Barack Obama has vetoed a bill that would have approved construction of the Keystone XL oil pipeline. The move, while expected, is still significant because it is only the third time that the current U.S. president has opted to shoot down a law that Congress has signed off on. But the move doesn't signal the end for the pipeline, which would carry oil from Canada to refineries in the U.S. The regulatory process is in its final phase as the State Department has finished collecting input and is now preparing a recommendation to the president. Obama must then decide whether the project is in the U.S. national interest. More to come http://www.cbc.ca/news/business/keystone-xl-bill-vetoed-by-barack-obama-despite-approval-by-congress-1.2969874 Obama vetoes Keystone XL bill, but White House says pipeline’s approval still ‘possible’ President Barack Obama issued the third veto of his presidency Tuesday to reject legislation that would allow the Keystone XL pipeline to be built, escalating a battle over the project between the White House and Republicans in Congress. Notice of the long-expected veto was released without fanfare via a message to the Senate just hours after the bill formally arrived at the White House. White House press secretary Josh Earnest said it’s “certainly possible” that Obama would eventually approve the pipeline once a State Department review of the project is completed. “The president will keep an open mind,” Earnest said, without giving a timeline for a decision. http://business.financialpost.com/2015/02/24/obama-to-veto-keystone-xl-approval-bill-tuesday-in-blow-to-pipelines-prospects/?__lsa=d3b9-fbd1 Link to comment Share on other sites More sharing options...
TOMapleLaughs Posted February 24, 2015 Share Posted February 24, 2015 What's his problem with it? With depressed oil values we're practically giving the stuff away now. Link to comment Share on other sites More sharing options...
hatedkid666 Posted February 24, 2015 Share Posted February 24, 2015 Thanks Obama Link to comment Share on other sites More sharing options...
Heretic Posted February 24, 2015 Share Posted February 24, 2015 I guess the rumours are true, he prefers Saudi oil than Canadian. Link to comment Share on other sites More sharing options...
jdatb Posted February 24, 2015 Share Posted February 24, 2015 Whatever Obama. Link to comment Share on other sites More sharing options...
Lancaster Posted February 24, 2015 Share Posted February 24, 2015 The first President in many decades that is against being more energy independent. Link to comment Share on other sites More sharing options...
Offensive Threat Posted February 24, 2015 Share Posted February 24, 2015 He either lets it get built or its delayed until the next prez OKs it. Either way itll happen its just a matter of when. Link to comment Share on other sites More sharing options...
GLASSJAW Posted February 24, 2015 Share Posted February 24, 2015 good Link to comment Share on other sites More sharing options...
Lockout Casualty Posted February 24, 2015 Share Posted February 24, 2015 The first President in many decades that is against being more energy independent. Except oil imports fell from 4.7 billion to 3.5 billion barrels per year between 2008 and 2013. And domestic production went up from 5 million per day to 7.5 million in the same time. Link to comment Share on other sites More sharing options...
Jiggs50 Posted February 24, 2015 Share Posted February 24, 2015 Still exploring in the middle east I guess... Link to comment Share on other sites More sharing options...
coastal.view Posted February 24, 2015 Share Posted February 24, 2015 this was expected it's simply politics a delay will occur the pipeline will go ahead unless oil consumption patterns change over the next 2 years or so Link to comment Share on other sites More sharing options...
Toni Zamboni Posted February 24, 2015 Share Posted February 24, 2015 Still invading the middle east I guess... ftfy Link to comment Share on other sites More sharing options...
Tystick Posted February 24, 2015 Share Posted February 24, 2015 I'm not too familiar with this topic, why is Canada willing to sell it's oil to the states in the first place? Wouldn't it be more logical for us to keep and use our own resources? Link to comment Share on other sites More sharing options...
key2thecup Posted February 24, 2015 Author Share Posted February 24, 2015 Opinion: Canada must take matters into its own hands if it wants to reap its resource wealth A sign opposing the Keystone XL pipeline is posted in a field near the site where the planned pipeline is to go, in Fullerton, Neb.. The White House has threatened to veto the bill approving construction of the Keystone XL oil pipeline. The Keystone XL pipeline issue has dragged on for six years, a political clash between oil barons and the green movement against the oilsands. In the coming days U.S. President Barack Obama must veto the bill or it becomes law. If he vetoes the bill, it’s still not over and can be overridden with a two-thirds vote. This torturous process, by the way, is nothing new. The St. Lawrence Seaway transformed both economies but was stillborn from the 1930s, due to Presidential foot dragging. Finally, Prime Minister Louis St. Laurent said Canada would create a Seaway that bypassed the U.S. to the Great Lakes so Washington got its act together and the Seaway opened in 1954 with great fanfare. Today is no different. Canadian interests have realized that waiting for Washington to decide anything is like watching paint dry in a steam bath. Oil companies have been doubling railway capacity to work around the Keystone obstructionism and by the end of this year three times as much oil will be shipped this way from Canada and North Dakota as would have flowed through Keystone. Others work on ways to bypass the U.S. market altogether. The St. Lawrence Seaway which transformed both economies was stillborn from the 1930s, due to Presidential foot dragging. Three proposals merit attention. One is to ship oil by rail 2,400 kilometres through a corner of B.C., Northwest Territories and Yukon to Alaska’s super tanker port at Valdez. This ingenious idea launched a new approach to the Keystone problem and was first proposed in 2011 by a First Nations consortium called G Seven Generations Ltd. (G7G). This group offers two major benefits: First Nations and Native Americans along the railway route have approved the scheme (and will be 50-50 partners) and, secondly, Washington is completely bypassed because cross border rail transport doesn’t require a Presidential permit. Alberta has put $1.8 million into a feasibility study, due to be released in March. Preliminary estimates were that costs would be similar to pipeline costs but there are skeptics. However, that doesn’t matter. Higher costs are better than stranded resources. Another idea, floated this week by Alberta Premier Jim Prentice, is to build a pipeline through the Northwest Territories and Yukon to Valdez. The benefits would be that B.C. would be bypassed and the territories and state are onside in principle, but the problem is that it too must obtain a Presidential permit. That makes it a non-starter unless Alaska, suffering from declines in oil production, fully backs the project and has the necessary muscle to get it through Washington. Its governor, Bill Walker, is an independent and may garner support from both parties. So far, Alaska’s response has been pitch-perfect from a Canadian viewpoint. A wire service this week quoted Walker’s spokesman in an email as saying he “welcomes all constructive dialogue on growing Alaska’s economy, and looks forward to sharing experiences with another world-class energy-producing region.” Another interesting, initially modest proposal is NWT Premier Bob McLeod’s “Arctic Gateway” that would ship oil by rail to Hay River then by barge to the port in Tuktoyaktuk for seasonal shipping. It would be a reversal of the Mackenzie Valley Pipeline that was proposed 40 years ago and approved, but that has never happened because of Ottawa’s foot dragging. Initially, amounts would be 100,000 barrels a day, but additional infrastructure could justify a sizeable oil pipeline from Fort McMurray to the Arctic for year around export, said Premier McLeod in a CBC interview. This would launch economic development in the Arctic region where huge reserves have been discovered. The sad saga of Keystone underscores an important historical fact: The Americans look after their own interests first and Canada has failed to build infrastructure to tap its northern resources and to diversify into new markets. This neglect is now coming home to roost as leaders and industry scramble. And the Canadian public must face the fact that each of these new proposals will require massive support from taxpayers just as was required to build the oilsands industry, Newfoundland’s offshore, Quebec’s hydro electric complex and many other nation-building projects. Canada must realize, as St. Laurent did, that a nation-state must take matters into its own hands and invest in itself. Nobody else will. http://business.financialpost.com/2015/02/13/diane-francis-canada-must-take-matters-into-its-own-hands-if-it-wants-to-reap-its-resource-wealth/ Link to comment Share on other sites More sharing options...
Tortorella's Rant Posted February 24, 2015 Share Posted February 24, 2015 Obama might have to order the construction of a different pipeline to deal with all the conservative tears. Link to comment Share on other sites More sharing options...
Hobble Posted February 24, 2015 Share Posted February 24, 2015 Why are we so keen to pump our oilsand oil down south for dirt cheap, while also selling away our water for dirt cheap? Link to comment Share on other sites More sharing options...
CanadianLoonie Posted February 24, 2015 Share Posted February 24, 2015 Except oil imports fell from 4.7 billion to 3.5 billion barrels per year between 2008 and 2013. And domestic production went up from 5 million per day to 7.5 million in the same time. The collapse is prices has made a lot of the recent production fields uneconomic so those numbers are out-of-date now. Link to comment Share on other sites More sharing options...
key2thecup Posted February 24, 2015 Author Share Posted February 24, 2015 The Growing Risk of Transporting Crude Oil by Rail By now you have probably heard that a CSX (NYSE: CSX) train carrying Bakken crude from North Dakota’s shale oil fields derailed and caught fire. The oil was bound for a coastal oil shipping depot owned by the midstream Master Limited Partnership Plains All American Pipelines (NYSE: PAA) in Yorktown, Virginia. While the cause is still under investigation, the train was carrying 109 tankers of crude oil. 26 of the cars left the tracks, and several caught fire. Some reportedly ended up in a tributary of the Kanawha River. Fortunately, there were no casualties from the accident, but one thing is certain: There will be more incidents like this, and it’s a matter of time before another incident like this happens in a more populated area. While there are safeguards in place to minimize the risks when these trains have to go through towns, the disaster in Lac-Mégantic, Quebec that claimed 47 lives emphasizes the risks of transporting flammable liquids. Following the incident, someone asked me “Why do we transport something so dangerous via rail?” That’s a good question. Why do we do it? It’s really very simple. Most of the country’s transportation system is based on oil. The production and sale of oil in the U.S. is a legal activity, and oil producers look to get the highest possible price for their product. Given that much of the nation’s refining infrastructure and demand is in coastal locations, and most of our oil production is not, in order for supplies in mid-continent regions like the Bakken Formation in North Dakota to reach the demand centers it must be transported. An oil producer in North Dakota who could only sell oil locally for $40 per barrel (bbl) might obtain $60/bbl on the East Coast. Thus, as long as the local price plus the cost of transport is less than the price at the destination, the producer is going to want to ship the oil. The preferred method of shipping crude oil, from a safety and cost perspective, is via pipeline. Pipeline transport also has a lower carbon footprint than shipping by rail. North America has an enormous underground network of oil and gas pipelines. In the U.S. alone there are 2.5 million miles of oil and gas pipelines — 53 times the length of the 47,000 miles in the US Interstate Highway System. Below is a partial map of just the largest pipelines that crisscross North America. Major North American Oil, Gas, and Product Pipelines. Source: Theodora It’s usually a bit cheaper to ship by pipeline. A 2013 investor presentation from the oil refiner Valero (NYSE: VLO) indicated that the company can ship Bakken crude by rail to the West Cost for $9/bbl, to the East Coast for $15/bbl, or to the Gulf Coast for $12/bbl. Pipeline routes are not available from the Bakken to all of those destinations (although the pipeline infrastructure is being expanded), but a rough approximation is that shipping by pipeline is ~$5/bbl cheaper than shipping by rail. The shipping distance is obviously a factor, but the point is that shipping by rail is not prohibitively expensive compared to pipelines. Over the past few years as oil production continued to expand in places like the Bakken, there was downward pressure on oil prices. Meanwhile, global crude oil demand continued to grow, and crude oil production outside the U.S. was relatively flat. While U.S. crude oil production rose by 3.2 million bpd between 2008 and 2013, global production outside the U.S. only rose by 0.5 million bpd during that time. As a result, there was upward pressure on the price of crude oil that could be sold internationally, and downward pressure on crude oil in the continental U.S. This opened up a price differential that provided an incentive to ship Bakken crude to the coasts. As a result, shipments by rail skyrocketed: There are a number of studies that show that shipping by rail is more dangerous than shipping by pipeline. In fact, a year ago the U.S. State Department did an analysis that projected that if oil is shipped via the (politically-delayed) Keystone XL pipeline, there will be 6 fewer deaths per year than if that same oil is shipped by rail. The environmental activists who work to block pipelines will dispute this, because they believe that blocking pipelines is an effective way to slow down the development of crude oil reserves. Their argument would be “There won’t be 6 additional deaths per year, because that oil will not take the rail instead.” I think this is a naive view, and is contradicted by actual observations. So, where is all of the new oil-by-rail traffic? The Wall Street Journal published a nice graphic detailing these routes: The greatest increase in traffic has come from that Bakken to East Coast “virtual pipeline.” Warren Buffet’s BNSF Railroad, incidentally, is the biggest player in moving oil out of the Bakken region. The red line in the map above likely represents the highest risk for future accidents given the number of crude oil trains traversing that route. In my view the only things that will slow the oil-by-rail trend are if either 1). The price of oil drops so low that it makes development uneconomical; or 2). The price differential between the source and the destination vanishes. These are issues related to demand. If demand is there, the oil will flow. Just look at the war on drugs to gauge the effectiveness of trying to cut off supplies in the fact of strong demand. But back to the question of why we ship oil by rail. The reason is that consumers demand oil, and that drives the price higher. Where consumers are willing to pay, the oil is going to get to market one way or the other. In this case, insufficient pipeline infrastructure out of the Bakken is the major driver of the oil to rail development, but blocking pipelines will have the same effect as long as the demand is there. Everyone who uses oil is culpable to some extent for these sorts of incidents. People will shake their heads at this latest incident, but few will change their driving habits to use less oil. Until that happens on a large scale, the oil will keep moving, perhaps right through your home town. http://theenergycollective.com/robertrapier/2196196/growing-risk-transporting-crude-oil-rail Link to comment Share on other sites More sharing options...
inane Posted February 24, 2015 Share Posted February 24, 2015 The collapse is prices has made a lot of the recent production fields uneconomic so those numbers are out-of-date now. That's kinda the thing about this whole mess...it's so unpredictable. Why we'd double down is beyond me. Link to comment Share on other sites More sharing options...
SamJamIam Posted February 24, 2015 Share Posted February 24, 2015 The collapse is prices has made a lot of the recent production fields uneconomic so those numbers are out-of-date now. Untrue. It's made expansions uneconomic but current oil sands operations are fine. Warren Buffett isn't backing Suncor for no reason. They've trimmed the fat and are looking pretty damn good, especially since the Bakken Oil Fields are under Saskatchewan as well as North Dakota. Those fields are shale and fracking is as efficient as the Saudi method of just digging a hole in the ground with shovels. That's kinda the thing about this whole mess...it's so unpredictable. Why we'd double down is beyond me. Regardless of the price of oil, pipelines are cheaper and safer than rail. This project pays for itself no matter what the economic conditions are. Link to comment Share on other sites More sharing options...
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