Tag: Tar Sands Pipeline

Obama approves major border-crossing fracked gas pipeline used to dilute tar sands

By Steve Horn. November 26, 2013. Source: DeSmog Blog

Although TransCanada’s Keystone XL tar sands pipeline has received the lion’s share of media attention, another key border-crossing pipeline benefitting tar sands producers was approved on November 19 by the U.S. State Department.

Enter Cochin, Kinder Morgan’s 1,900-mile proposed pipeline to transport gas produced via the controversial hydraulic fracturing (“fracking”) of the Eagle Ford Shale basin in Texas north through Kankakee, Illinois, and eventually into Alberta, Canada, the home of the tar sands.

Like Keystone XL, the pipeline proposal requires U.S. State Department approval because it crosses the U.S.-Canada border. Unlike Keystone XL – which would carry diluted tar sands diluted bitumen (“dilbit”) south to the Gulf Coast – Kinder Morgan’s Cochin pipeline would carry the gas condensate (diluent) used to dilute the bitumen north to the tar sands.

“The decision allows Kinder Morgan Cochin LLC to proceed with a $260 million plan to reverse and expand an existing pipeline to carry an initial 95,000 barrels a day of condensate,” the Financial Post wrote.

“The extra-thick oil is typically cut with 30% condensate so it can move in pipelines. By 2035, producers could require 893,000 barrels a day of the ultra-light oil, with imports making up 786,000 barrels of the total.”

Increased demand for diluent among Alberta’s tar sands producers has created a growing market for U.S. producers of natural gas liquids, particularly for fracked gas producers.

“Total US natural gasoline exports reached a record volume of 179,000 barrels per day in February as Canada’s thirst for oil sand diluent ramped up,” explained a May 2013 article appearing in Platts. ”US natural gasoline production is forecast to increase to roughly 450,000 b/d by 2020.”

Before Eagle Ford, Kinder Morgan Targeted Marcellus

Pennsylvania’s Marcellus Shale basin was Kinder Morgan’s first choice pick for sourcing tar sands diluent for export to Alberta. It wasn’t until that plan failed that the Eagle Ford Shale basin in Texas became Plan B.

Known then as the Kinder Morgan Cochin Marcellus Lateral Project proposal, the project fell by the wayside in February 2012.

“The company’s Cochin Marcellus Lateral Pipeline would have started in Marshall County, West Virginia, and transported natural gas liquids from the Marcellus producing region of Pennsylvania, West Virginia and Ohio,” wrote the Mount Vernon News of the canned project. [It] would [then] carry the [natural gas] liquids to processing plants and other petrochemical facilities in Illinois and Canada.”

“Kinder Magic”: More to Come?

Industry market trends publication RBN Energy described Kinder Morgan’s dominance of the tar sands diluent market as “Kinder Magic” in a January 2013 article.

“These are still early days for the developing condensate business in the Gulf Coast region,” RBN Energy’s Sandy Fielden wrote. “Plains All American and Kinder Morgan are developing the potential to deliver at least 170,000 barrels per day of Eagle Ford condensate as diluent to the Canadian tar sand fields in Alberta by the middle of 2014.”

Fielden explained we could see many more of these projects arise in the coming years.

“We have a sense that before too long there will be many more condensate infrastructure projects showing up like ‘magic’ in midstream company presentations.”

While the industry press coverage sounds optimistic, it doesn’t account for the concurrent rise of public opposition to dirty energy pipelines and expansion plans in the fracking and tar sands arenas, so only time will tell the fate of Cochin and its kin.

Transcanada to build tar sands pipeline to Atlantic

By John Queally, August 2, 2013. Source: Common Dreams

energy_east

With the passage of the Keystone XL pipeline uncertain and under financial pressure to find export terminals so to justify expansion of vast tar sands operations in Alberta, the Canadian pipeline company—with backing from the Harper government— announced on Thursday that it will seek to build an enormous eastward pipeline so it can bring what critics call “the world’s dirtiest fuel” to market.

Called the “East Energy Pipeline,” the $12 billion project would connect with existing pipeline networks in Quebec province and will be able to move up to 1.1 million barrels of tar sands oil a day up and over the northeastern United States to the coast of New Brunswick.

The new project, according to TransCanada’s CEO Russ Girling, is not intended to signal that the company has given up on building Keystone but shows it is willing (and able) to push for multiple pipelines at any given time.

“What we know in North America is production is continuing to grow,” Mr. Girling said at a news conference in Calgary. “The marketplace needs both of these pipelines and probably more.”

Joe Oliver, Canada’s natural resources minister, welcomed the TransCanada announcement and said the Canadian government would offer its full support.

“Our government welcomes the prospect of transporting Canadian crude oil from Western Canada to consumers and refineries in Eastern Canada and ultimately to new markets abroad,” Oliver said in a statement.

Critics, however, were unimpressed and vowed to fight the pipeline with the same energy and intensity that Keystone XL has faced.

“TransCanada is desperate to show that tar sands are viable, ” said Michael Marx, the ‘beyond oil’ campaign director for Sierra Club. “The truth is they are not. This announcement of an eastern Canada pipeline is a fantasy. It’ll face the same opposition dirty, dangerous pipelines to the west or south through the United States face, if not more. Tar sands is the dirtiest source of oil on Earth and running it through Montreal, Quebec and the Bay of Fundy is like running Keystone XL through Manhattan and the Grand Canyon. It’s not going to happen.”

As the New York Times adds:

TransCanada’s new plan involves converting 1,864 miles of a natural gas pipeline to carry oil, and the construction of 870 miles of new pipeline, mainly in Quebec and New Brunswick. It has long-term contracts to carry about 900,000 barrels of oil a day along the route, Mr. Girling said.

“They’re in for a fight,” John Bennett, the executive director of the Sierra Club of Canada, said shortly after the announcement. Mr. Bennett said he was particularly concerned about the possibility of oil spills in the Bay of Fundy in New Brunswick and about harm to whales in the area from tanker traffic. In a statement, Environmental Defence said the plan was “yet another misguided scheme that puts Canadians in harm’s way for the benefit of the oil industry’s bottom line.”