US Energy Transportation Network Gets Multibillion-Dollar Revamp 124
Hugh Pickens writes writes "Simone Sebastian writes in the Houston Chronicle that the nation's energy transportation network is undergoing a multibillion-dollar overhaul, as oil and natural gas production surges in new regions of the country and energy producers charge into new areas with technology that can reach oil and natural gas trapped in shale and other tight rock formations leaving pools of crude and gas stranded far from the Gulf Coast refineries and petrochemical plants that need them. 'Where it used to be isn't where it is now. Where it needs to go isn't where it used to go,' says Terrance McGill, president of fuel carrier Enbridge Energy. 'You're seeing this fundamental shift of crude oil across the country.' For example Phillips 66 CEO Greg Garland says his company is considering buying 2,000 more rail cars that could carry an additional 150,000 barrels a day from shale regions (PDF) to its refineries across the country because the glut of crude oil pouring out of the newly tapped shale oil plays like North Dakota's Bakken has kept the price of Mid-Continent crude at a record-wide discount of up to $27 per barrel relative to its rival European benchmark Brent crude because there is not enough pipeline capacity to get Bakken crude to Gulf coast refineries. 'That's a pipeline on wheels,' says Garland. 'You'll see us stepping out and doing some more things around infrastructure. Like everyone else, we're doing everything we can to get more barrels in front of those facilities.'"
Re:Great. Where are my cheap solar panels? (Score:5, Interesting)
Re:Great. Where are my cheap solar panels? (Score:3, Interesting)
China took our solar tech, mass produced panels at a loss to flood the market, and drove the innovators out of business. Now we're stuck with 5-year old tech because China is the only game in town, and they're not innovating. If China competed fairly, the innovators would have found ways to get panel production costs below what they currently are. The price of panels would be even lower than the Chinese price, which is losing them money.
Hopefully, the new tariffs on Chinese solar panels will help correct this, and bring innovators to market.
Why do we want to ship crude x-country? (Score:5, Interesting)
I'd be interested in seeing a good analysis of exactly WHY something like the Keystone XL pipeline (or the OP's huge number of railcars) is necessary for shipping crude to the Gulf Coast.
I realize that 80% of the US's refineries are on the Gulf, but, given a couple of things:
Something similar goes for the various Shale gas extractions - I would think that it would be far better to build power generation (since that's where 90% of the gas is going to go) right near the gas fields, and then spend money on an upgraded Power Grid, rather than try to ship the gas around to existing power stations.
Basically, I think we're falling into the trap where we just assume that transportation is less expensive than co-location of end use. I'd far rather pay for another refinery and gas power stations (added capacity) AND a better power grid, than cough up the same amount for just another couple of pipelines (which, frankly, all they add is environmental disaster potential).
-Erik
Re:Why do we want to ship crude x-country? (Score:4, Interesting)
Even with the pipeline, refining close to the point of extraction really makes sense for tar sands.
The stuff is heavy and nasty and the "dilbit" or diluted bitumen that has to be made out of it so it can flow is much, much worse than normal crude.
It's more corrosive to the pipe and more noxious and toxic when spilled.