In Texas, millions of barrels of new pipeline capacity is under construction to get their oil to market. According to Bloomberg, major Permian Crude Pipelines projects currently underway include:
- Gray Oak – Complete in end of 2019 – 700,000 – +1,000,000 bpd
- EPIC – Complete in 2nd H of 2019 - 440,000 – 675,000 bpd
- Cactus II – Complete btw 3rd Q of 2019 – April 2020 – 585,000 – 670,000 bpd
- Permian-Nederland – Complete in mid-2020 - 600,000 – 1,000,000 bpd
- Permian-Gulf Coast – Complete in mid-2021 – 1,000,000 bpd
These are just some of the pipelines that will help increase shipping capacity to refineries off the Gulf Coast to meet rising global demand for oil.
Permian Pipelines to Run Out of Capacity Soon…
Oil production in one of the United States best producing zones – the Permian Basin – is growing at a staggering rate of 800,000 barrels per day (bpd) annually. Just recently, production from this zone has averaged 3.3 million bpd, meaning that producers are likely to run out of space to ship their product very soon, with total pipeline capacity rated at 3.6 million bpd.
So, what have some of the involved energy companies done to fix the problem? Go full speed ahead with pipeline permit applications and construction in the quickest sense possible.
The Gray Oak
Multinational Phillips 66 and Canadian Enbridge have decided to build the Gray Oak Pipeline, which is expected to carry millions of barrels per day from West Texas to the Houston and Corpus Christi shipping regions. Developers expect it to be up and running during the second half of 2019.
Meanwhile, there’s another massive pipeline in the works by ExxonMobil and Plains All American that will ship over 1 million barrels per day out of the region. Both companies are working steadfastly to lay the foundations for the project in hopes of it being operational by 2021.
That isn’t the only project Plains All American is working on. There’s also the Cactus II that will ship hundreds of thousands of barrels to the Corpus Christi / Ingleside areas where there’s flexibility to access multiple docks for shipment out of the country.
Gulf Coast Express
There’s also Kinder Morgan getting into the pipeline frenzy in Texas. Just shortly after having its Trans Mountain expansion bought out by the federal government in Canada, the company has announced plans to team up with a few other midstream developers and build a US $2 billion, 2-billion cubic feet per day pipeline that would transport natural gas from the Waha region to Mexico via the Gulf Coast.
What about pipeline construction in Canada?
Well, that’s an entirely different story - as you probably already know.
With Canada’s pipeline system at full capacity, midstream energy companies have been stymied from completing new infrastructure projects like Northern Gateway, Energy East, Trans Mountain expansion and Keystone XL to help Canada receive the best price for our oil and gas.
Special interest groups have created regulatory gridlock, delayed projects, protested hearings, trespassed against judicial orders and have even chained themselves to equipment to sow fear and disinformation about the merits of these important projects.
Just recently, the sale of the privately-funded Trans Mountain expansion project to the government is a telltale sign of the status of pipeline construction in Canada. Kinder Morgan wanted out because of uncertainty and regulatory confusion. The upcoming Bill C-69 that will also make any new pipeline proposal next to impossoble according to many commentators.
As the USA continues to expand its capacity to meet rising global demand for oil, Canada is diddling in the courts while it sells its oil to its only customer (the USA) – losing about CAD $40 to $75 million every day because of massive discounts.
Enough with these paid protestors, many of whom have been paid for by money from outside Canada! We need every Canadian to stand up for Canada’s economic future and prosperity before its too late!
What Can YOU Do?
There’s many things you can do to support Canada’s future. To start, it’s important that we make sure the conversation about Canada’s oil and gas industry is a balanced and fact-based one by doing these:
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