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Researched by Industrial Info Resources (Sugar Land, Texas)--In April 2015, based on available project data, Industrial Info forecasted that Canadian pipeline mega-projects would lead to a boost in Alberta oil prices starting in 2017. For more on that forecast, see the April 8, 2015, article - Canadian Mega-Projects May Boost Alberta Oil Price Starting in 2017.
As with any prediction of the future, the world turns and things change. Since the original article was published, Industrial Info has seen the continued development of an outsider pipeline project, the end of an almost decade-long permitting saga as well as repeated delays and challenges for other takeaway pipeline projects. As it stands, the projected boost to Alberta's oil price won't come until late 2019 when the first few projects start to come online. That said, in the current economic climate with production ceasing to rise as rapidly as it was in 2012-2014 when many of these mega-projects were proposed, all five projects will likely not be needed to serve oil sands producers.
While their statuses have changed, the players now are much the same as then with one notable exception. TransCanada Corporation (NYSE:TRP) (Calgary, Alberta) has put on indefinite hold its initially-500,000 barrel-per-day (BBL/d) Keystone XL (KXL) pipeline project, taking it out of the race. An outsider player has entered the race in its place, however. Eagle Spirit Energy Holdings (Vancouver, British Columbia) has proposed its own 1 million-BBL/d pipeline, the Eagle Spirit pipeline , which would go west to the coast of British Columbia rather than south through the U.S. Eagle Spirit has not filed for permitting from any government body; however, it has been engaging with First Nations communities along its proposed route and has reported success in doing so. This runs counter to its competition, the 525,000-BBL/d Northern Gateway Pipeline by Enbridge Incorporated (NYSE:ENB) (Calgary, Alberta), which has gone the traditional route of seeking government approval first, and dealing with local populations later. Thus, Northern Gateway has found itself potentially without a permit as its latest appeal to have its original conditional approval extended has been denied. Still, Eagle Spirit is not expected to become operational until 2021, well after Northern Gateway would be completed.
Enbridge and TransCanada have other pipelines in the works, however. TransCanada's 1.1 million-BBL/d Energy East pipeline project would carry Alberta oil sands crude east to New Brunswick for export via an associated terminal. Following Eagle Spirit, this mammoth project has the latest completion date, and is not expected to begin operation until late 2020, a full year after the remaining pipeline projects.
Enbridge's 760,000-BBL/d Line 3 Reactivation differs from its competitors in that it is a line replacement that crosses an international border, not a new build, which would carry Alberta oil sands crude south into Enbridge's network to eventually reach the Gulf Coast refining hub. This project's classification as a replacement project is important as it is expected to exempt the project from needing a new presidential permit, the document that vexed the KXL for years. That said, protesters are fighting this exemption, claiming that due to the different grade of crude oil to be carried through the line, as well as the sheer size of the project (roughly $7 billion), it should have to reapply for presidential permission to cross the Canadian-U.S. border.
Last but not least is Kinder Morgan Incorporated (NYSE:KMI) (Houston, Texas) with its TransMountain Expansion project (TMEP 890), which would expand the existing TransMountain system by 590,000 BBL/d and carry crude west through British Columbia to be exported to Asia. While originally this project was meant to have an expedited permitting process, TMEP 890 is suffering at the hands of the federal government. That said, it has cleared Canada's National Energy Board's (NEB) review process and is awaiting its day with the feds, still expecting to start operations in late 2019, alongside most of the other players.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 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. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.
As with any prediction of the future, the world turns and things change. Since the original article was published, Industrial Info has seen the continued development of an outsider pipeline project, the end of an almost decade-long permitting saga as well as repeated delays and challenges for other takeaway pipeline projects. As it stands, the projected boost to Alberta's oil price won't come until late 2019 when the first few projects start to come online. That said, in the current economic climate with production ceasing to rise as rapidly as it was in 2012-2014 when many of these mega-projects were proposed, all five projects will likely not be needed to serve oil sands producers.
While their statuses have changed, the players now are much the same as then with one notable exception. TransCanada Corporation (NYSE:TRP) (Calgary, Alberta) has put on indefinite hold its initially-500,000 barrel-per-day (BBL/d) Keystone XL (KXL) pipeline project, taking it out of the race. An outsider player has entered the race in its place, however. Eagle Spirit Energy Holdings (Vancouver, British Columbia) has proposed its own 1 million-BBL/d pipeline, the Eagle Spirit pipeline , which would go west to the coast of British Columbia rather than south through the U.S. Eagle Spirit has not filed for permitting from any government body; however, it has been engaging with First Nations communities along its proposed route and has reported success in doing so. This runs counter to its competition, the 525,000-BBL/d Northern Gateway Pipeline by Enbridge Incorporated (NYSE:ENB) (Calgary, Alberta), which has gone the traditional route of seeking government approval first, and dealing with local populations later. Thus, Northern Gateway has found itself potentially without a permit as its latest appeal to have its original conditional approval extended has been denied. Still, Eagle Spirit is not expected to become operational until 2021, well after Northern Gateway would be completed.
Enbridge and TransCanada have other pipelines in the works, however. TransCanada's 1.1 million-BBL/d Energy East pipeline project would carry Alberta oil sands crude east to New Brunswick for export via an associated terminal. Following Eagle Spirit, this mammoth project has the latest completion date, and is not expected to begin operation until late 2020, a full year after the remaining pipeline projects.
Enbridge's 760,000-BBL/d Line 3 Reactivation differs from its competitors in that it is a line replacement that crosses an international border, not a new build, which would carry Alberta oil sands crude south into Enbridge's network to eventually reach the Gulf Coast refining hub. This project's classification as a replacement project is important as it is expected to exempt the project from needing a new presidential permit, the document that vexed the KXL for years. That said, protesters are fighting this exemption, claiming that due to the different grade of crude oil to be carried through the line, as well as the sheer size of the project (roughly $7 billion), it should have to reapply for presidential permission to cross the Canadian-U.S. border.
Last but not least is Kinder Morgan Incorporated (NYSE:KMI) (Houston, Texas) with its TransMountain Expansion project (TMEP 890), which would expand the existing TransMountain system by 590,000 BBL/d and carry crude west through British Columbia to be exported to Asia. While originally this project was meant to have an expedited permitting process, TMEP 890 is suffering at the hands of the federal government. That said, it has cleared Canada's National Energy Board's (NEB) review process and is awaiting its day with the feds, still expecting to start operations in late 2019, alongside most of the other players.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 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. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.
