The pipeline conundrum.

The US runs (I think), 7 different bulk oil storage facilities across the US.   Cushing Ill. is the largest of these and draws of ships in the Gulf as well as inland pipelines.  Obama took bold strides in securing the US supply by building over 12,000 miles of new pipeline to hook these storage facilities together. Cushing can now draw off the other facilities like North Dakota, for supply. This takes a huge pressure off the supply and demand scenario visited for so many years. This also gives the reason why the US wants to keep the oil on rail.  After cars are in the US the oil companies can re-route them any place they want.

While this is going on the US is building more pipelines into Mexico to move more natural gas, condensate and crude.

They can tweak supply while they play market magic. Obama cut off Saudi Arabia from the Gulf states opening the refineries to Mexico. Trump mitigated this.

Condensate out of the Balkan presented a problem. It is high in the condensate.  The Condensate is used to make Airplane gas and Car Gas and to blend P50 and so on. It cannot be re-injected as this simply thins out the crude and adds costs to refining as the condensate is put through several times. Condensate is actually a surplus to the refinery action which is designed to make heating and fuel oil. Not every refinery produces gasoline (condensate)

The export of Condensate from the US was illegal by US law. So, Trump opened up the export of Condensate to Mexico for the first time in US history! Now Mexico can produce all the gasoline blends and diesel blends and will enter into export agreements for the same, something Canada can’t do because of the US protestors active in Canada.   I’m pretty sure there will be no resolution in the Eastern pipelines any time soon and I am just as certain a harsher stand will have to be taken against the protesters who don’t really know what they are protesting against, or for.

From <https://ipolitics.ca/2018/11/16/cracking-the-puzzle-of-canadas-pipeline-problem/&gt;

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.