Posted on 10/07/2011 4:36:20 PM PDT by jazusamo
I think it’s more an issue of where the refineries are, and the difficulty in getting any new refineries built.
Refineries are expensive, and new ones are hard to get past the environmentalists. And yes, it would be nice if the Gulf weather didn't affect our oil supply as much as it does--but is it worth the cost to duplicate or replace it? And given the predictable opposition, how long would it take?
The OIL comes from Canada. There is no depletion allowance for foreign origin oil. This stuff simply has no well head taxes or tax breaks in the American tax system.
It blows my mind that there is even a question of approving construction of the Keystone XL pipeline. The oil sands will be developed one way or another. The U.S. will keep using oil for decades. Doesnt it make more sense to import oil from Canada than from repressive, autocratic nations like Venezuela and Saudi Arabia? (And for those who conflate being anti-pipeline with a belief that Peak Oil is around the corner what better reason could there be to secure strategic supplies of crude?)
A lot less time than the legal battle, that will start shortly. Matter. Of fact I think the nature crowd file their first case a few days ago. http://www.huffingtonpost.com/2011/10/05/groups-sue-to-block-construction-of-keystone-xl_n_996075.html
Cost of the pipe line, is probably 100 times that of a refinery. That is cost effective. So which is the most cost effective. Building a refinery in the north, are a ten years legal fight, and stealing thousands of peoples property by eminent domain.
Whiting Refinery Modernization Project
http://www.bp.com/sectiongenericarticle.do?categoryId=9030203&contentId=7055766#7205736
Today, BP is investing several billion dollars in Northwest Indiana to modernize its Whiting Refinery for the processing of heavier crudes. The modernization is essential to the long-term viability of the refinery, and includes well over a billion dollars in environmental improvements.
The modernization
project will provide for greater energy security in the
Midwest, as conventional supplies of the lighter crudes
diminish, and are replaced by heavier crudes.
With this in mind, the project involves repositioning Whiting
to be able to run heavier sour crude oil. It involves a new
crude distillation unit, a 100kbd coker, world scale
hydrotreating and sulphur recovery, and improvements
I might ad that the oilsands will be exploited and production will be increased if this pipeline is built or not. If the US doesn’t want the oil a pipeline will be built over the mountains to the west coast. The oil will be loaded into tankers and sold to the Chicoms.
Do you have some references for that? Obviously, the relative cost matters. Without any specific knowledge of my own, I would have though the pipeline cheaper.
You’re absolutely right, the Chicoms can’t wait to get their hands on it.
I guess that is a bad thing too.
Interesting--I didn't know that. It's not "100 times" though. I suppose there are ancillary costs and delays. I'll consider what you've said, but without knowing the rest of the story (refinery construction, who would have the expertise to own and build it, the rest of the transportation story) I can't really form a fully informed opinion. But, you've given me something to think about and look into, as I assumed the pipeline would just be a lot cheaper.
It’s been awhile since I studied engineering economics and industrial engineering as an undergrad...refresh my memory.
what does that have to do with a project “at tax payers expense”? Is the pipe privately owned or not?
Listen up buddy, I like your posts on this thread. I don’t know if I agree with everything you say, but i do want you to keep talking.
btw, its starting to sound to me like you are in favor of building new refineries in north america. I like that idea. In fact, I’ve been wondering out loud why we don’t build a refinery in north dakota...along with all the other ancillaries that go with a refinery...as in hydro cracking and such.
Lots of jobs. lots of national security. lots of american know how and independence. Sure, maybe some ass*holes in DC and wallstreet won’t get as big a bonus on their stocks, but do I need to quantify my regrets on that to you?
You need to get into this discussion pronto, thackney!
This is not at tax payer expense.
They are not asking for tax breaks, just permission to spend their money and go to work.
Nonsense. You use the same refinery and refine North Americal petroleum instead of crude oil from OPEC.
There is no change in volume required, just a change in a more reliable and friendly source.
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