BC Business
Oil pipeline | BCBusinessThe Obama administration delayed its decision on the Keystone XL oil pipeline to after the 2012 U.S. presidential election.
Despite all the noise, energy analysts predict the Keystone XL oil pipeline from Alberta will still be built. But that doesn't mean we won't be shipping oil from B.C. some day. There sure is a lot of gas being emanated over oil delivery these days. Most of this comes about because of the U.S. government’s “shocking” decision to put off approval for the Keystone XL pipeline that would carry Alberta tar sands oil to the U.S. gulf coast where all the refining capacity is.
There sure is a lot of gas being emanated over oil delivery these days.
Most of this comes about because of the U.S. government’s “shocking” decision to put off approval for the Keystone XL pipeline that would carry Alberta tar sands oil to the U.S. gulf coast where all the refining capacity is.
Anyone who thinks it’s shocking that U.S. President Barack Obama decided to put off the pipeline hearings until after the next election must be living deep in some oil well somewhere. The man is clinging to the presidency by his fingernails and doesn’t need an oil pipeline controversy further killing any chance for re-election in 2012.
But Obama’s decision did raise hopes that the oil would instead be piped to the B.C. deep-water port in Kitimat for shipping to Asia, which wants that oil to power its growth economies.
Certainly Enbridge Inc. hopes that killing Keystone makes its proposed Northern Gateway pipeline more palatable to opposing First Nations and environmental groups in B.C. The pipeline’s $5.5 billion pricetag may buy a lot of love in Northern B.C. And Kinder Morgan Energy Partners is still shopping around a plan to expand its existing pipeline from Alberta to the southern B.C. coast to carry more tar sands oil.
But Keystone may not quite be dead yet, a Vancouver energy analyst said this week. Casey Research’s chief energy investment strategist, Marin Katusa, told Cambridge House interviewer and former BCBusiness blogger Tommy Humphreys that the Keystone line will eventually be built.
“Keystone is going to happen because it’s part of the Americans’ energy solution,” says Katusa, noting that America’s voracious appetite for oil depends on Canada because its oil supplies are more secure than in war zones like Iraq and Libya, where the U.S. now sources some oil.
It’s also cheaper, running $55-$60 a barrel, while “bloody oil” from world war zones cost more like $80 a barrel. And Canadian oil doesn’t require billions of dollars for armies to move in and attempt to secure the oil, he added.
Seems to me this investment analyst has a pretty clear view that cuts through all the gaseous rhetoric surrounding the tar sands oil, oil pipelines, and blind environmental activism that aims to stop all oil now.
It’s simple: it’s going to take a long time to replace oil as a dominant energy source, so the U.S. needs our oil for the foreseeable future. And despite all the political talk about opening up new markets in Asia, we’re going to continue supplying it to the Americans.
But if this brings us to the realization that we should also be shipping oil to China, as well as addressing all the environmental dangers that moving oil across B.C. holds, then good.
It’s definitely going to be part of the equation in future.