U.S. Sees Less Petroleum Liquids Pipeline Project Completions in 2021

Researched by Industrial Info Resources (Sugar Land, Texas)--Pipeline companies completed 14 petroleum liquids pipelines projects last year in the U.S., according to the U.S. Energy Information Administration (EIA), a drop for the third consecutive year, and the lowest number since 2013. Jesus Davis, Industrial Info's North American research specialist for the oil and gas production, pipelines and terminals industries, says the decline shouldn't come as a surprise for a number of reasons.

The completed projects include seven crude oil pipelines and seven hydrocarbon gas liquids pipelines, according to the EIA's January 19 Today In Energy report.

Click on the image at right for an EIA chart showing petroleum liquids pipeline project completions since 2010.

Of the completed projects:

• Six were new pipelines.
• Five projects were expansions of existing systems.
• Two projects reversed the direction that the commodity flowed on the pipeline.
• One project was a change in the commodity carried by the pipeline.

Notable completions in 2021, according to the EIA, included:

• Enbridge Incorporated's (NYSE:ENB) (Calgary, Alberta) Line 3 replacement and Line 61, two expansions that move crude oil from Alberta to Illinois. Line 3 goes from Alberta to Superior, Wisconsin. Line 61 goes from Superior to Pontiac, Illinois. Subscribers to Industrial Info's Global Market Intelligence (GMI) Pipelines Project Database can click here for a list of Line 3 project reports and here for a list of Line 61 projects. For related information, see November 9, 2021, article-Enbridge Expects $8 Billion in Capital Items to be Placed in Service This Year
• Marathon Pipe Line LLC's (Houston, Texas) Capline Reversal, which reversed the direction of the pipeline to a south-flowing pipeline that originates in Patoka, Illinois, and flows to terminals in St. James, Louisiana. Subscribers can click here for a list of related projects.
• Energy Transfer LP's (Dallas, Texas) Dakota Access Pipeline (DAPL) expansion project, which increased capacity by 180,000 barrels per day (BBL/d) along the DAPL system by adding horsepower and modifications and upgrades at pump stations. The DAPL system runs from North Dakota, through South Dakota and Iowa, and ends near Patoka. Click here for a list of related projects

Regarding the drop in the number of completions last year, Davis cited a number of reasons. Among them, the U.S. has just come off one of the biggest pipeline construction booms in its history. For related information, see November 10, 2021, article-North America Pipeline Spending Dips as Industry Sees Downside of Recent Building Boom.

Other reasons, he said, include:

• Crude oil production has not returned to peak pre-COVID levels.
• Forecasts for crude oil production are lower than pre-COVID levels, therefore mitigating the immediate need for new pipe capacity.
• There is excess crude pipeline capacity in major producing regions.
• Environmental opposition to new pipelines is stronger than ever.
• The energy transition is pushing fossil fuels out of favor (more perception than reality, Davis added.)
• The Environmental, Social and Governance (ESG) movement is making it difficult for companies to invest in traditional fossil-fuel projects.

Industrial Info tracked $2.45 billion worth of crude oil pipeline completions last year. Subscribers to Industrial Info's Global Market Intelligence (GMI) Pipeline Project Database can click here for a list of detailed project reports.

This compares with $6.57 billion worth of completions in 2020, but just less than $1 billion worth in 2019.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn.