Keystone readies SE Texas linkage

Beaumont Enterpris ^ | May 30, 2012 | Dan Wallach

[thackney]

A crude oil pipeline that will run 485 miles from Cushing, Okla., to Southeast Texas should be under construction by late summer and operational in late 2013. TransCanada, the builder of the Keystone Pipeline, is looking for workers, vendors and suppliers to help support the $2.3 billion project.

On Tuesday, TransCanada conducted a registration workshop in Beaumont, similar to others it has sponsored in other areas along the route.

"We'll need supplies, goods and services," TransCanada spokesman Jim Prescott said, listing fuel, tires, oil and welding sticks.

And, he said, "We anticipate it will create about 4,000 direct construction jobs across the 485 miles."

More than 100 vendors and people curious about a job had signed in to the three-hour event with about an hour left to go. The presentation was at the Holiday Inn Beaumont Plaza.

The work also will require clearing contractors, right-of-way maintenance, portable rest room contractors and plenty of other services associated with a large construction project.

Earlier this year, it looked as if the Keystone project would be delayed because of political challenges and a dispute about the route through an environmentally sensitive area of Nebraska. TransCanada had to apply for a "presidential permit," as Prescott called it, because the overall project passes from the Canadian provinces of Alberta, Saskatchewan and Manitoba and then into the United States.

Pipeline opponents say the crude oil, processed from tar sands, is environmentally dangerous, particularly if the oil were to foul waterways and aquifers.

[thackney]

[thackney]

Pipeline opponents say the crude oil, processed from tar sands, is environmentally dangerous, particularly if the oil were to foul waterways and aquifers.

However, no presidential permit is needed for the section TransCanada calls the “Gulf Coast Project,” linking the oil hub at Cushing to a terminal in Nederland.

A section of Keystone pipeline already brings oil from Canada to a refinery and storage tank farm in Illinois. That section also is routed through Cushing.

Prescott said the Keystone pipeline already in operation since 2010 has delivered 16 million barrels. He added the proven reserves of oil in the Alberta tar sands are estimated at 175 billion barrels.

The Gulf Coast segment of the pipeline would be divided into three “spreads,” Prescott said. The segment from Lufkin to Nederland is 112 miles long, he said. Each of the three spreads would be built assembly-line style, meaning that crews would simultaneously clear the route, dig the pathway, lay the pipe until it all ultimately linked.

The line will be about 4 feet deep along most of the route, dipping significantly deeper under roadways and waterways. For example, the portion of existing line that crosses the Mississippi River in the Midwest is 65 feet under the river’s bottom, Prescott said.

Prescott said he could not name specific customers because of confidentiality, “but we have long-term contracts (average length: 18-20 years) that account for approximately 85 percent of the pipeline’s 700,000 barrel per day capacity.”

http://fuelfix.com/blog/2012/05/30/transcanada-talks-jobs-supplies-at-beaumont-workshop/

[Recon Dad]

Sounds like things are starting to back up in Cushing.

Growth in output from shale-rock formations in the U.S., including the Bakken in North Dakota, and from Canada’s oil sands has bolstered supplies at Cushing. Inventories at the hub climbed 3.7 percent to a record 46.8 million barrels in the seven days ended May 18, according to the department. U.S. output has gained for three consecutive years.

[thackney]

Yes, in spite of the Seaway reversal, there is still more oil pushing to Cushing than being taken away.

http://fuelfix.com/blog/2012/05/30/oil-glut-seen-in-survey-defying-seaway-reversal/

We are still quite short on pipeline capacity to match the areas of growing production.

It will catch up, but it will take some time.