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US Energy Transportation Network Gets Multibillion-Dollar Revamp
Hugh Pickens writes writes "Simone Sebastian writes in the Houston Chronicle that the nation's energy transportation network is undergoing a multibillion-dollar overhaul, as oil and natural gas production surges in new regions of the country and energy producers charge into new areas with technology that can reach oil and natural gas trapped in shale and other tight rock formations leaving pools of crude and gas stranded far from the Gulf Coast refineries and petrochemical plants that need them. 'Where it used to be isn't where it is now. Where it needs to go isn't where it used to go,' says Terrance McGill, president of fuel carrier Enbridge Energy. 'You're seeing this fundamental shift of crude oil across the country.' For example Phillips 66 CEO Greg Garland says his company is considering buying 2,000 more rail cars that could carry an additional 150,000 barrels a day from shale regions (PDF) to its refineries across the country because the glut of crude oil pouring out of the newly tapped shale oil plays like North Dakota's Bakken has kept the price of Mid-Continent crude at a record-wide discount of up to $27 per barrel relative to its rival European benchmark Brent crude because there is not enough pipeline capacity to get Bakken crude to Gulf coast refineries. 'That's a pipeline on wheels,' says Garland. 'You'll see us stepping out and doing some more things around infrastructure. Like everyone else, we're doing everything we can to get more barrels in front of those facilities.'"
How come all the oil and gas companies keep expanding like this and all the solar companies keep going bankrupt? Wasn't it supposed to be the other way around? Damned hippies lied to me again.
What political party do you join when you don't like Bible-thumpers *or* hippies?
Damn, for a moment I thought the US would bury all their electric, phone and TV cables like the rest of the civilized world.
You may as well be discussing the pros and cons of the new heroin shipping routes.
The fossil fuel addiction is just as destructive and involves the same level of denial of reality.
Specially for tech people. Get off the obsession with oil based technology and make us some seriously steampunk alternatives that work.
Where are we going and why are we in a handbasket?
... leaving pools of crude and gas stranded...
The very best part of the Houston Chronicle article comes after the end, in the "We Recommend" section:
"Tokyo man cooked own genitals, served to diners"
I'd click on it, but I'm at work.
In times of universal deceit, telling the truth gets you modded -1 Troll
This smacks me as being a bit odd and inefficient. Given the volume being produced, wouldn't a pipeline make more sense? It'd be safer and cheaper in the long run. Of course, given the troubles the Keystone XL pipeline is having, maybe it's more economic to truck it than to try and get through all the red tape for a pipeline.
Help find a cure for cancer. Join the [H]orde
Oh... I thought this was about burying power cables... so that you stop getting blackouts every time a whiff of wind topples some tree along the street!
Hippies: Don't build a pipeline, it will destroy the environment
Oil Companies: Fine, we'll put it on a train, create more CO2, and refine it anyways.
People: Look, gas is down to $2.75 a gallon!
sudo make me a sandwich
dropped the price of natural gas that even coal plants ramp down. Solar was barely approaching the old price point of power generation and then fracking hit. Combined with the nuclear scare and countries exploring alternatives the money landed on wind power because its currently a better option than solar.
* Winners compare their achievements to their goals, losers compare theirs to that of others.
Why not build an actual pipeline from the middle of the country to the Gulf region, where the refineries are?
Ken
I don't know how far the transportation network extends, but the first sentence of the summary goes on, and on, and on...
Better known as 318230.
Just another Pickens article that has nothing to do with anything. He just wants hits on his site... and it's what we give him.
I'd be interested in seeing a good analysis of exactly WHY something like the Keystone XL pipeline (or the OP's huge number of railcars) is necessary for shipping crude to the Gulf Coast.
I realize that 80% of the US's refineries are on the Gulf, but, given a couple of things:
Something similar goes for the various Shale gas extractions - I would think that it would be far better to build power generation (since that's where 90% of the gas is going to go) right near the gas fields, and then spend money on an upgraded Power Grid, rather than try to ship the gas around to existing power stations.
Basically, I think we're falling into the trap where we just assume that transportation is less expensive than co-location of end use. I'd far rather pay for another refinery and gas power stations (added capacity) AND a better power grid, than cough up the same amount for just another couple of pipelines (which, frankly, all they add is environmental disaster potential).
-Erik
There are always four sides to every story: your side, their side, the truth, and what really happened.
Tap the energy from EMO's whining about how bad their life is.
You forgot the lack of a carbon tax or cap and trade system for co2 emissions. That's a massive subsidy of today's oil companies by future generations who will be paying to re-do the economy as a whole in a world of greatly warmed climate, shifted arable zones, an acidified ocean, and enviro-wars.
Where are we going and why are we in a handbasket?
TX
http://blog.google.org/2011/10/new-geothermal-map-of-united-states.html
or maybe even:
http://www.cbc.ca/news/canada/british-columbia/story/2011/10/03/bc-fusion-energy-project.html
http://en.wikipedia.org/wiki/General_Fusion
Where are we going and why are we in a handbasket?
The lack of a tax is not a subsidy.
In times of universal deceit, telling the truth gets you modded -1 Troll
It just seems odd. This is more a business article than anything else, and there is nothing new and cool about buying rail cars.
Our domestic pipeline infrastructure has been on a building spree for a decade. If any of you are investors, that's been the basis for the Oil&Gas MLP buildout that has been maturing at a very fast clip since the mid-2000's, continued right through the crash, and continues to mature at a modestly fast clip today and probably for another 10 years at least before the core-buildout slows down.
Generally speaking transport for OIL and NGLs (Natural Gas Liquids) can start out in tankers and rail cars but ultimately cost efficiency requires a pipeline to be built. And you have no choice for natural gas... its pipeline or nothing pretty much since compression to CNG or LNG levels is way too expensive (and way too dangerous) for domestic transport.
But it takes several years to build a long pipeline, costs billions of dollars, and requires both shippers and receivers to enter into long term 10-year+ contracts with guaranteed volume flow or investors wouldn't finance the pipeline in the first place. Because no actual revenue flows until the pipeline is complete.
There are a dozen major producing areas but in layman's terms the bottleneck is mainly in the North->South direction these days. EastWest has capacity now (though numerous major cities on the east coast still have bottlenecks). Existing pipelines in the north-south direction are essentially maxed out.
The Keystone pipeline saga is your typical talking-head/exaggerated/public-unaware crap. Pipelines criss-cross the U.S. already, there are already numerous (but maxed out) pipelines coming down from Canada all the way to the gulk, and Canada is a major trading partner whos major oil and gas reserves are essentially land-locked. Sure, they have some transport to the coasts for export, but they need to be able to drop down through the border into the U.S. markets and we also have an export market of our own going northward of light NGLs which the Canadians use for a multitude of purposes in their oil-sands operations. It's as much a diplomatic issue with our northern neighbor as it is anything else.
-Matt
Meh. Cap and trade is an 'artificial' market (trying to explain why that is a bad thing to wet-behind-the-ears mainstream economists, who are so giddy with various treatises and papers proclaiming the wonders of such beasts, let alone their less-knowledgeable friends, is a pleasant act of futility; Morbo: "Markets do not work that way! Good night!") and is so rife with corruption that it compares rather favorably with the accounting practices of Enron & friends. You would have to be dangerously out of touch with the happenings of that evil thing to think some good may come of it.
Not that I am a fan of subsidies for corporations, governments, etc.
Why are we in such a hurry to sell it overseas? Short ourselves to gain a couple bucks a gallon profit.
Watch the way it's dropping the price or oil. Not a coincidence.
Some CEO at Chesapeake Energy gets caught hedging against his own company.
It's easy when there is no disclosure when bidding up commodities with a minimum down$.
That incident was last month and energy value has been dropping ever since.
They will try to blame it on the "election" too. Like after the 2007- 2008 (crash) was $1.86 a gallon
Let's get this straight; The Keystone pipeline is for exporting our oil hence the coast "refineries."
Why don't they just admit it? Instead of playing politics. We can not drill our way out of this
Electric trains and everybody starts walking more. Suddenly diabetes rate drops...miraculously.
You are right. Cap and trade is easy to render impotent by changing definitions of things to the point of meaninglessness. It's full of potential accounting tricks that would ensure that no real progress was made on the only number that matters in this topic: the rate of change of CO2 concentration in the atmosphere.
A hefty carbon tax is much simpler, stands a chance if implemented at being effective in reducing fossil-fuel use, and thus is predictably politically impossible.
What the hell is it about us that makes the intelligent and effective choice politically impossible. "Then we're stupid and we'll die !"
Where are we going and why are we in a handbasket?
unless the levels of taxation are assymetrical; i.e. unless there are more categories of deductions and greater levels of deductions for one industrial sector compared to other sectors of the economy. Then it would be a subsidy. I think if you study the details there is a a subsidy by this definition for the fossil fuel industry.
Where are we going and why are we in a handbasket?
http://youtu.be/lkswXVmG4xM
I'm not saying it's true. But what if it is? What are the implications? What if these petroleum corporations would put their billions of dollars into researching and developing technology that's just waiting to be used?
These people who claim to be witnesses were trusted to the utmost, including some who were trusted with nuclear launch authorization codes. No nuts would be given a job like that.
"Those who consume the bulk of goods are those who make them. We must never forget this secret of our prosperity."
Close to Gulf oil plays, yes. But it also makes exporting pork-subsidized crude and natural gas to more lucrative foreign markets mere childs play. That's the main reason for Keystone XL transporting corrosive tar sands instead of refined products: the option to export it instead of lowering domestic US prices by even five cents.
Ah, thank you, Comrade, for explaining it to me. Now I love Big Brother. An extra ration of beets and vodka for you, for "educating" me!
And now, I must leave to attend the Occupy Wyatt Oil protest. That idiot sister of our glorious friend, James Taggart, is getting ready to kill half the population of Denver by running a train down that damned dangerous rail line of hers...
Who is John Galt?
In times of universal deceit, telling the truth gets you modded -1 Troll
There's a reason Warren Buffett bought a railroad and GE (makes the engines...) ... and a reason the Administration blocked a pipeline for their best-buddy in Omaha who spews the "I need to be taxed more" message for them.
Back, meet scratcher.
+++OK ATH