Major pipeline expansion needed in the US
Despite major accidents in the past year, U.S. oil companies must keep using the nation’s railroads to move crude to markets while they build a much more extensive pipeline network, an energy economics professor said Tuesday.There are several obstacles to pipeline expansion not the lest of which is the anti energy left which has the ridiculous belief that by blocking things like the Keystone XL they can reduce the amount of oil and gas used. That is certifiably not true and their efforts only empower despots like Putin. The pipeline projects will also produce a lot of construction jobs. Republicans should be talking to the unions about backing these projects.
Oil refineries on the East Coast have virtually no access to the light, sweet crude extracted in Texas’ surging oil fields because there are no pipelines to carry the oil there. It is generally too expensive to ship the crude from the Gulf Coast to buyers in the northeastern U.S. because of quirks in century-old laws, forcing refineries in New Jersey to buy oil from the Middle East and elsewhere, said Bernard Weinstein, associate director of the Maguire Energy Institute at Southern Methodist University.
“This is a serious logistical challenge,” Weinstein said in a panel opening the 10th annual Pipeline Opportunities Conference at the George R. Brown Convention Center in downtown Houston. “We need all the infrastructure that we can rally.”
Energy storage and transportation companies have made progress in their multibillion-dollar bid to build pipelines between U.S. shale plays that became active in the past five years and domestic markets. But they’re still decades away from fixing infrastructure gaps like the one between Texas oil fields and New Jersey refineries.
While the oil industry waits for the Obama Administration’s decision on the controversial northern segment of the Keystone XL pipeline, billionaire Harold Hamm’s $300 million Pony Express pipeline and other infrastructure projects are expected to connect gushing oil wells in North Dakota to the major U.S. pipeline hub in Cushing, Okla.
But more expensive and more dangerous crude-by-rail shipments are expected to remain the primary mode of transportation out of the Bakken Shale for at least another two years, Weinstein said.