Keystone XL Pipeline Permit is Cancelled

[Pineywoods]

Canceling the Keystone Pipeline costs over 11,000 construction jobs and 42,100 jobs throughout the US during the construction process according to the US State Department.

Canceling the Trump border wall will cost 10,000 jobs.

-Gateway Pundit

[Ironman]

It's an expansion of an existing line, but with some other/new legs. Keystone is operating, Keystone XL is the expansion/new line. Reality being, the pipe was really no longer needed. It a low impact "win" for Biden to show the greenies. Probably also see him ban new oil and gas leases on federal lands (announced a pause today). Another small win, but reality is that most/all of the good leases are already leased, rest is more exploration or has other challenges.

Canada needs to build more to their west coast, because its all going to get exported to Asia anyway.

Low impact win? Tell that to everyone benefiting from the construction of the pipeline.

[CWP]

Low impact win? Tell that to everyone benefiting from the construction of the pipeline.

It causes no immediate impact at all is my point.

If the pipe were to get built, yes there would be the contract jobs to build it. But I think it can also be argued that the benefits of KXL accrue more to Canada than to the US.

Keeping Canadian barrels out of the US market incrementally benefits US crude oil pricing (less supply, same demand). This also keeps Canadian pricing more challenged (they have to price the cheapest to get their barrels into the existing pipes) so US marketers and refiners can buy the discounted Canadian barrels cheaper than waterborne heavy barrels. It will flow on existing pipes, and yes, incrementally some will go rail...at least until Canada builds west (Transmountain expansion, which itself is facing challenges from Canadian enviros and First Nations).

Basically if we were to build this pipeline we get the short-term benefit of contract jobs for its construction, but Canadians get the long-term benefit of a home for their barrels and higher Canadian crude prices (they are net exporters). Incrementally benefitting US prices probably does us more good than helping Canadian prices. May keep some oilfield jobs in place, after we've already lost so many.

KXL was first proposed in 2008. Back then it was needed. But since then US crude production has risen from 5 million barrels per day to 13 (and now 10-11 with the COVID and OPEC induced pullback). KXL was designed for a different time. Before it would even come online there are other expansions that will more than meet the needs of Canada, and the US already has enough crude on our hands. Free markets fixed the hole. Politics certainly intervened and delayed this particular pipeline, but the market found a way around it.

So, to me the headlines make it a easy win for greens and an easy argument for opponents, but its not really a big loss. The big real pipeline risk is with Dakota Access. Shutting down an existing pipeline transporting US crude to US refiners will likely bring a lot of issues on many levels. Watch that one closely.

[texansfan]

It causes no immediate impact at all is my point.

If the pipe were to get built, yes there would be the contract jobs to build it. But I think it can also be argued that the benefits of KXL accrue more to Canada than to the US.

Keeping Canadian barrels out of the US market incrementally benefits US crude oil pricing (less supply, same demand). This also keeps Canadian pricing more challenged (they have to price the cheapest to get their barrels into the existing pipes) so US marketers and refiners can buy the discounted Canadian barrels cheaper than waterborne heavy barrels. It will flow on existing pipes, and yes, incrementally some will go rail...at least until Canada builds west (Transmountain expansion, which itself is facing challenges from Canadian enviros and First Nations).

Basically if we were to build this pipeline we get the short-term benefit of contract jobs for its construction, but Canadians get the long-term benefit of a home for their barrels and higher Canadian crude prices (they are net exporters). Incrementally benefitting US prices probably does us more good than helping Canadian prices. May keep some oilfield jobs in place, after we've already lost so many.

KXL was first proposed in 2008. Back then it was needed. But since then US crude production has risen from 5 million barrels per day to 13 (and now 10-11 with the COVID and OPEC induced pullback). KXL was designed for a different time. Before it would even come online there are other expansions that will more than meet the needs of Canada, and the US already has enough crude on our hands. Free markets fixed the hole. Politics certainly intervened and delayed this particular pipeline, but the market found a way around it.

So, to me the headlines make it a easy win for greens and an easy argument for opponents, but its not really a big loss. The big real pipeline risk is with Dakota Access. Shutting down an existing pipeline transporting US crude to US refiners will likely bring a lot of issues on many levels. Watch that one closely.

Shhh...

[Ironman]

It causes no immediate impact at all is my point.

If the pipe were to get built, yes there would be the contract jobs to build it. But I think it can also be argued that the benefits of KXL accrue more to Canada than to the US.

Keeping Canadian barrels out of the US market incrementally benefits US crude oil pricing (less supply, same demand). This also keeps Canadian pricing more challenged (they have to price the cheapest to get their barrels into the existing pipes) so US marketers and refiners can buy the discounted Canadian barrels cheaper than waterborne heavy barrels. It will flow on existing pipes, and yes, incrementally some will go rail...at least until Canada builds west (Transmountain expansion, which itself is facing challenges from Canadian enviros and First Nations).

Basically if we were to build this pipeline we get the short-term benefit of contract jobs for its construction, but Canadians get the long-term benefit of a home for their barrels and higher Canadian crude prices (they are net exporters). Incrementally benefitting US prices probably does us more good than helping Canadian prices. May keep some oilfield jobs in place, after we've already lost so many.

KXL was first proposed in 2008. Back then it was needed. But since then US crude production has risen from 5 million barrels per day to 13 (and now 10-11 with the COVID and OPEC induced pullback). KXL was designed for a different time. Before it would even come online there are other expansions that will more than meet the needs of Canada, and the US already has enough crude on our hands. Free markets fixed the hole. Politics certainly intervened and delayed this particular pipeline, but the market found a way around it.

So, to me the headlines make it a easy win for greens and an easy argument for opponents, but its not really a big loss. The big real pipeline risk is with Dakota Access. Shutting down an existing pipeline transporting US crude to US refiners will likely bring a lot of issues on many levels. Watch that one closely.

Want to set an over or under on what fuel prices will be in our country a year from now?

[CWP]

Want to set an over or under on what fuel prices will be in our country a year from now?

KXL would have no impact on that since it would take at least a year to build and get into service.

That said, commodity prices calls are widow-makers...and right now is extra interesting since we have no idea when society gets back rolling. Aside from that, the current crude price is essentially a false price, because OPEC and Russia have so much crude artificially off the market. So they have a pretty strong hand right now. They can flood the market to attempt to put a finishing touch on US shale, or they can slowly regulate the market higher. Eventually we will get there and we are due for at least one more bull run in crude prices. The US is underinvesting in supply right now, that's for sure.

Dodging the actual question, but I guess my spitball answer, assuming for "fuel" we are saying the rough Texas price of regular unleaded gasoline, I'd draw the line in the $2.50-2.75/gal area, so higher. We will get another run above $3, but just not sure if its 2021, 2022, or 2023.

[Ironman]

Point being, this is just the first step, of many, Biden has made that will crush the O&G industry.

[S-3 Ranch]

[B “Joe Biden secured the victory in the elections, promising to deliver a green new deal and signaling a likely re-engagement with Iran. ]” [/B][focuseconomic]
I expected the green new deal, but Iran my memory was short and forgot he was part of the Iranian money grab in Obama admin
I guess we will start getting cozy with Iranian state

[CWP]

Point being, this is just the first step, of many, Biden has made that will crush the O&G industry.

Like I said, I think this actually helps, very very slightly, the US O&G industry by benefitting medium-term pricing.

I don't think Biden will be a friend to US O&G, but I'm positioned to think that he's not out to hurt O&G as much as try to help renewables. I can see several low-impact things like this to claim a few wins and then move on to other fights and trying to drum-up money to fund renewables. A ban on new federal leases is easy (maybe even banning fracing on new leases), sounds like a big deal, but doesn't change much. They did just put a 60 day pause, we will see if/how it expands.

Time will tell, and its certainly uncertain (pun intended). The GA Senate losses don't help, that's for sure, But the margin is pretty thin, need to win some Republican support to do anything too monumental. The wildcard is that both Obama and Trump have set a pretty big precedent with executive order usage. Obama opened the gate and Trump ran with it.

[Acameron52]

He’s a dirt bag.

[huntandfishguy6]

I just read that one of the unions wasn't happy with this new development. But what were they expecting, he promised he would kill the project, and he did.

[jkw08]

Had read somewhere a while back that Canada had put up a gob of investment money for the project, and most of the line in Canada had been laid already, no wonder Canada is ******...


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[OldRiverRat]

Keystone XL Pipeline Permit is Cancelled

There will be more economic impact. All those barrels would have landed in the us gulf coast, occupying more storage space (infrastructure which creates jobs) and would have increased exports which would lead to more port revenue. There would have been more incremental refining as well which would have an economic impact.
Eventually the bbls will move, and t will just be railed which has way more negative impact on the environment so
Once again the dumb&&& liberals have created a bigger problem than they solved


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[47]

800,000 barrels /day.

[Texas452]

I’m not a bit surprised.
These people are just getting started there is no common sense involved,everything is an agenda.
Remember the Obama economy pretty dismal.
After all we do have the kids running the household again!