Is the Keystone XL Pipeline Dead Too?

Considering the devaluation of oil and the even less valuable oil from oil sands why build the pipeline to transport it? If investors still go ahead with this upon approval from Feds and states I'll be surprised but hopeful that they see a better future for oil.

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Permalink Reply by Joseph-Ohio on December 6, 2014 at 6:43am
'Is the Keystone XL Pipeline Dead Too?

Hope not.

As I understand it Keystone crude needs diluent to get it to flow in the pipe to our southern refineries.

Dilluting products seems to me would come from our wet gas wells and sent / sold to Canada.

However it would seem to me that the US should also charge Canada' wheelage' / some tariff to use the pipeline to traverse our geography.

Juat the way I see it.

Build the pipe develop more wells and improve refineries.

Jobs !
Permalink Reply by Mike Fulper on December 6, 2014 at 11:32am

Native North American Indians.. STOPPED the pipeline in Canada from going West to Pacific

Obama spent some time with the LAKOTA SOUIX... this summer ??/ duhhhhhh

wonder why ?   check to see if the Souix reservations are in the way of the Pipeline...

Souix don't want the pipeline either....

Keystone has NOTHING to do with getting US more oil... Only the Chinese....

Permalink Reply by Joseph-Ohio on December 6, 2014 at 2:23pm
Read that Asia is going with OPEC and has stopped trading with the west.

Does that mean China or other Asian States I wonder.
Permalink Reply by Joseph-Ohio on December 6, 2014 at 2:47pm
I understand that the Keystone pipeline is scheduled to deliver diluted Canadian Tar Sands Oil to southern US refineries (Louisiana). With the refined product then to be sold to other countries.

But natural gas liquids / diluent from our wells will be required to be sent to Canada to dilute the bitumen gleaned from the Canadian Athabasca Tar Sands. I would imagine more new wet natural gas wells would be required to adequately supply the diluent that Canada would need. That seems to me would mean more leasing and jobs.

Building out the pipeline means construction jobs and R O W agreements with landowners.

Thinking new / remodeled Refineries would be required to deal with Keystone Canadian production which would mean jobs.

Sounds like good for business, landowners and jobs to me.

What am I missing here ?

If Native Americans don't want it on their lands go around them.
Permalink Reply by Dan on December 7, 2014 at 12:01am
J-O,

"Dilluting products seems to me would come from our wet gas wells and sent / sold to Canada."

I think there is a very good possibility that the term "Market Enhansement" is defined as: Utica condensates are stolen / sent to Canada to dilute the bitumen with Utica mineral owners kindly paying the transportation of their stolen condensates north to Canada.

Dan
Permalink Reply by Joseph-Ohio on December 7, 2014 at 3:10am
Dan,

Thought the lease would stop such goings on.

Seems to me getting paid for the value of your resources is a consideration when selling mineral rights as well.

Wondering if only 'loose' lease agreements that would permit such goings on have been / are being developed thus far ?

Anybody out there getting paid for their liquids and not paying market enhancement I wonder ?
Permalink Reply by Dan on December 7, 2014 at 3:44am
J-O,

Even if a barrel of liquids sent to Alberta only cost $30 including shipping, how could the economics be there to justify tar sand development? Trucking, rail & pipeline companies are always the winners, they get paid roughly the same per unit shipped give or take the price of fuel to ship or build the pipeline.

I'm for developing all cost effective energy sources if they meet acceptable environmental standards. The tar sands remind me of the early mountain logging where trees were used to build the rail line, power the steam engines of the trains and mills & power the generators in the kiln drying ovens. Always wondered how many trees it took to make a board. How many barrels of oil will it take to get a barrel of refined product from the tar?

Dan
Permalink Reply by Joseph-Ohio on December 7, 2014 at 5:45am
Good questions.

If it's not economical why would they do it ?

My answer is that it must be economical.

Hoping however it's not proving to be economical because they take the liquids for nothing or because they can charge 'market enhancement' to others (lessors ?).

Standing by for clarifications from anybody out there.

Thanks Dan.

J-O
Permalink Reply by Jim Litwinowicz on December 7, 2014 at 6:44am

These projects are designed for the long term.It will be around for at least 25-30 yrs  Temporary dips in crude prices will not stop it.The Saudis cannot afford to keep prices this low for very long as their economic system requires oil at higher prices.  I suspect that in a year or so, you will prices back around $90.

Permalink Reply by Joseph-Ohio on December 8, 2014 at 3:51am
Jim,

'.....around for at least 25-30 years.....'

Find myself wondering if a few major contributing factors to it's longevity (taking so long to develop / harvest) might not be on the account of all of the various argument / legislation / litigation / self-serving politics / politicians ?

Perhaps even primarily on those (above) accounts.

However, can't rule out some honest negotiation chewing up time as markets and development seemingly ever so slowly arrange.
Permalink Reply by Joseph-Ohio on December 8, 2014 at 10:53am
Projected Future Value seems to me would impact circumstances as well.

25-30 years out seems a long time for any investor to wait seems to me.
Permalink Reply by Jim Litwinowicz on December 8, 2014 at 12:56pm

I attempted to say that the pipeline would be in existence and pumping oil for 25-30 AFTER COMPLETION therefore a temporary drop in crude prices would not be a concern.  Sorry I wasn't clear on that.

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