Quote:
Originally Posted by WarrenC12
Refineries are at max capacity and nobody is building any more. Nothing suggests more pipeline capacity would increase gasoline supply. TM2 is for bitumen export, 100%.
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1. Except for the brand new $9.4 billion dollar Sturgeon refinery coming online right now near Edmonton, which is currently producing about 35,000 barrels of diesel per day. And this is only just the first phase; by the completion of all three phases, Sturgeon is capable of processing 150,000 barrels of oil per day.
2. Reducing pipeline constraints will allow more refined product to be shipped to the PNW from Alberta, which has a production surplus of refined product. Remember, BC gets 55,000 barrels per day of refined fuel from Alberta from the existing Trans Mountain pipeline, while 30,000 barrels a day comes from Washington State refineries.
3. The expanded Trans Mountain pipeline also includes expansion of the Sumas spur line, which feeds Washington state refineries. Currently, 54% of the capacity the current pipeline supplies goes to Washington State along the Sumas spur.
Remember, Washington state refineries mostly run on Alaskan crude, supplemented by crude oil coming from pipelines, and from rail:
https://fortress.wa.gov/ecy/publications/documents/1808005.pdf
The US market is broken into Petroleum Administration for Defense Districts (PADDs) and PADD 5 (the West Coast, Alaska and Hawaii) is not effectively interconnected to the rest of the US by pipelines. As such it mostly must be self-sufficient or must import oil.
The thing is, Alaska's oil fields are starting to run dry:
https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MCRFPAK2&f=A
Because Alaska's production of crude oil is in continual decline, barring a major oil discovery in Alaska that's relatively easy to access, PADD 5 is experiencing a supply shortage of crude oil, which is causing pressure on pricing for refined products.
As such, in recent years, the Washington state refineries have been looking for alternative sources of crude, and they've been sourcing from both whatever they can get from Trans Mountain, and via oil by rail shipments (mostly Bakken crude with some Canadian oil sands supply as well), which currently make up over 25% of Washington state's imports.
Right now, the current pipeline is over 30% over subscribed by shippers looking to ship through the pipeline, and Trans Mountain has been running at capacity for years:
https://www.neb-one.gc.ca/nrg/ntgrtd/trnsprttn/2016/ppln-cpcty-eng.html#s12
4. The expansion of Trans Mountain also includes the refurbishment of the existing pipeline, which would be set aside for the transport of lighter grades of crude and refined product, thereby reducing bottlenecks on the existing pipeline.