Mike Priaro's profile

ENERGY EAST OR KEYSTONE XL –WHICH WILL IT BE?

                                                                      Canada's New Prime Minister Justin Trudeau.
 
ENERGY EAST OR KEYSTONE XL
–WHICH WILL IT BE?
Mike Priaro, P.Eng.
 
First uploaded Oct. 24, 2015.  Last updated Nov. 13, 2015.
With Liberal governments now in Ottawa, Ontario, Quebec, New Brunswick, and Nova Scotia, with Atlantic provinces solid red federally, and with both Alberta NDP and Saskatchewan Conservative governments indicating strong support, one might think the path is paved for approval and construction of Energy East within the next four years.
 
This is especially true after President Obama's formal rejection of Keystone XL on Nov. 6, 2015.  If Keystone XL will ever get approval it is not likelty before the inauguration of the next U.S. president in January, 2017.
 
However, there are significant issues, questions, and complications to be resolved for the Energy East proposal beyond the presence of supportive or Liberal governments from Alberta to Atlantic Canada.
 
With oil sands production forecasts reduced due to low oil prices, TransCanada Corp.’s Energy East proposal is in direct competition for oil volumes from the Northern Gateway, Trans Mountain expansion, and Eagle Spirit oil pipeline proposals to the West Coast, with just-completed and proposed expansions of Enbridge's Mainline to the U.S. and with its own Keystone XL proposal uponn which TransCanada Corp. has not given up.
 
Only one of those six pipeline projects are required in the foreseeable future under the “Operating & In Construction” oilsands production forecast issued in June 2015 by the Canadian Association of Petroleum Producers, and only two are required under CAPP’s “Additional Growth” forecast.
 
CAPP’s “Operating and In Construction” oilsands forecast shows an increase in oilsands production of only 680,000 bbl/d (equivalent to one new oil pipeline) between 2015 and 2030, and an increase of only 1.66 million bbl/d (equivalent to two new oil pipelines) between 2015 and 2030 under its “Additional Growth” scenario.
                                                                        Source: Canadian Association of Petroleum Producers, June 2015.
owever, with more than 99 percent of Canada's crude exports already going to just one customer, the U.S., the last thing Canada needs is another crude export pipeline to the U.S. –Keystone XL. 
 
Also in June, TransCanada laid off 185 people from its major projects department, then announced a 20 per cent reduction in senior leadership positions at the VP level and above, and just this past week announced it will eliminate about 30 director positions just below VP level.
 
These staff reductions can only reduce TransCanada’s ability to manage and resolve, in Canada’s best interests, its internal conflict over its competing pipeline proposals.  And such staff reductions can only reduce TransCanada’s capability to, for once, manage to design, obtain approval for, and fill, even one oil pipeline to tide water.
 
Even before the recent staff reductions, TransCanada had erred in its selection of Cacouna QC as Energy East's second marine terminal thereby causing a two-year delay in approval for Energy East in order to re-work the NEB application. 
 
TransCanada also errs in proposing the Saint John NB Canaport terminal, located in the ecologically-sensitive Bay of Fundy, as the main crude export terminal for Energy East.  Rather, TransCanada must propose the Canso NS Superport, by far the safest and most ecologically-acceptable port on Canada’s East Coast, and the closest to markets in Europe, Africa, and western India, as the main crude export terminal for Energy East in its re-worked application.
 
There are further serious questions and complications regarding the fate of TransCanada’s Energy East proposal.
 
Will the Liberal government of Philippe Couillard in Quebec stand in the way of Energy East, or delay it so long that it is no longer viable?
 
Will Canada's new Prime Minister Justin Trudeau support Energy East, which is overwhelmingly in Canada’s best economic interests, despite his long-expressed support for Keystone XL?
 
And might President Obama later approve the border crossing permit for Keystone XL in return for action, agreements, and/or commitments on greenhouse gas emissions from a more receptive Prime Minister Justin Trudeau –thereby effectively continuing the U.S. stranglehold on Canada’s crude oil exports for many years?
 
Enbridge’s recent and proposed expansions to its Mainline to the U.S., November’s reversal of Enbridge’s Line 9B to Montreal, and construction of Keystone XL would mean that there will be no significant volumes of crude available for Energy East for at least 15 years under CAPP’s “operating and in-construction” oilsands production forecast – even without any new pipeline capacity to West Coast tide-water.
 
On Nov. 13, 2015 Prime Minister Trudeau asked for a moratorium to be placed on tanker traffic in  waters off the northern coast of British Columbia.  Moratorium, n. A temporary prohibition of an activity.  Oxford English Dictionary.
 
This will affect the prospects for the Eagle Spirit proposal, the most worthy of all current pipeline proposals, and for the Northern gateway proposal -considered by most to be effectively a dead horse anyway.
 
One wonders how any moratorium would affect tanker traffic transporting Alaska North Slope crude from Valdez to the U.S. west coast.
 
 
Mike Priaro, P.Eng.
Calgary 
403-281-2156
AUTHOR BIO

"Mike Priaro, B.Eng.Sc. (Chem. Eng.), U.W.O. '76, P.Eng., Lifetime Member Association of Professional Engineers and Geoscientists of Alberta (APEGA), worked in facilities, production, operations and reservoir engineering, as engineering consultant, area superintendent, and engineering management in Alberta's oil patch for 25 years for companies such as Amoco and PetroCanada.”

“He increased oil production from the historic Turner Valley oilfield and brought in under-balanced drilling and completion technology to drill out, complete, and test several of the highest producing gas wells ever on mainland Canada at Ladyfern.  He co-authored ‘Advanced Fracturing Fluids Improve Well Economics’ in Schlumberger's Oilfield Review and developed the course material for the ‘Advanced Production Engineering’ course at Southern Alberta Institute of Technology.”

"Mike has presented his work to Canada’s House Committee on Natural Resources in Ottawa and had work published by the Macdonald-Laurier Institute in the March and April, 2014 and February, 2015 editions of Inside Policy magazine, by U.S. energy industry websites such as RBN Energy, in the July 17, 2014 edition of the Oil and Gas Journal, in Petroleum Technology Quarterly, Q3 2014, and in several columns in the Calgary Herald and Edmonton Journal.

“Mike has no formal connection to any oil company, environmental organization, think tank, labour organization, lobbying or special interest group, academia, or to provincial or federal politics.”
 
“Mike was recently retained by Alberta Sulphur Research Limited to conduct "A Preliminary Engineering, Economic, and Environmental Evaluation of ASRL's Partial Upgrading Process"  which he presented to 80 representatives of ASRL's member companies.  ASRL partial upgrading has since obtained Alberta government funding and industry support for a flow test pilot now underway at CANMET/NRCan’s research facility in Devon, AB.”

“Mike is the author of  “A ‘Canada-First’ Canadian Energy Strategy” (see https://www.behance.net/portfolio/editor?project_id=5808629) and is available for special projects, and speaking engagements.”
ENERGY EAST OR KEYSTONE XL –WHICH WILL IT BE?
Published:

ENERGY EAST OR KEYSTONE XL –WHICH WILL IT BE?

Which will it be -Energy East or Keystone XL?

Published: