North America Pipelines News
TransCanada Proposes Second Oil Pipeline
by Art Hovey Lincoln Journal-Star
June 12, 2008
The project would connect with the Keystone pipeline already
Representatives of TransCanada were expected to brief Fillmore County, Neb., commissioners Thursday on the possibility of building part of a
proposed $7 billion oil pipeline through the Geneva area.
The project is meant to connect with a $5.2 billion Keystone
pipeline already under construction from the oil sands region of
Alberta through eastern Nebraska to delivery points in Illinois and
Company spokesman Jeff Rauh stressed Monday the second project,
originating in the same area in Canada and joining with the first
one in Jefferson County, does not have the green light yet from
However, "we do believe that this is a project that is likely to
go forward. And, if it were not, we would not be taking these
steps," Rauh said.
The latest proposal to bring more Canadian oil to the U.S. could
offer encouraging news to drivers confronting $4 gas.
According to the most optimistic estimates, the Canadian oil
sands are believed to contain oil deposits comparable to those in
Saudi Arabia, but the resource must be separated from sand deposits
and is more difficult to refine.
If the second pipeline proceeds, it would extend beyond Oklahoma
to the Gulf Coast and Port Arthur, Texas.
As another preliminary step in Nebraska, open houses have been
scheduled in five communities, including York and Fairbury, in early
Fillmore County Clerk Amy Nelson said the company didn't provide
advance details on its presentation to commissioners in Geneva
Thursday, but Rauh characterized that session and others planned with other county governments as "just to provide an overview of
activities we're engaged in in their areas."
As was the case with the first project, expected to reach the
full construction stage across Nebraska next year, the second
carries some big numbers. Among them:
* A 1,980-mile path for a 36-inch pipe buried 4 feet under the
ground from Hardesty, Alberta, to an end point near Houston, Texas.
* A permanent easement 50 feet wide entering north-central
Nebraska and proceeding diagonally to Jefferson County. The clock
starts ticking on the tentative construction timetable for the
second project in 2010.
Rauh said contacts with communities in Nebraska and other states
suggest "the developers feel comfortable about committing the
resources to keep the project moving forward."
"However," he added, "it's still a possibility, given no
signature on the bottom line for shippers on the project, that,
until the shippers are in place, the project could fall apart."
The first project, now in the construction stage in North Dakota,
is scheduled to enter Nebraska near Yankton, S.D., and to go through
10 Nebraska counties on its way south.
Peter Lidiak, director of the American Petroleum Institute's
petroleum segment, said TransCanada is one of several Canadian
companies strengthening its energy connection with the U.S.
"The important thing is we're looking to secure reliable supplies
that provide stability in energy sources," Lidiak said from
Washington, D.C. "And increased use of pipelines to bring oil from
Canada, which is a close ally and a friendly country to the U.S., is
just that. It produces stability and better reliability."
Lidiak said Canada is already a major supplier to the U.S. "The
projections I've seen tell me that Canadian oil production could go
from 1.1 million barrels (per day) to 4.4 million in 2020."
Rauh said there is no business connection between what
TransCanada is doing and plans for a major oil refinery in southeast
However, "it's the same development of oil in Canada that has
driven the need for the Keystone pipeline and the evaluation of the
second project and is likely influencing the location of the
refinery in South Dakota."
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