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Keystone XL Pipeline Dead

This is a discussion on Keystone XL Pipeline Dead within the Current Events forums, part of the Tech Support Forum category. All of this obscured the fact that this pipeline would neither be the silver bullet to the U.S. economy proclaimed


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Old 11-06-2015, 10:37 AM   #1
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All of this obscured the fact that this pipeline would neither be the silver bullet to the U.S. economy proclaimed by some, or the death knell to climate proclaimed by others.
LINK to Announcement

Don't you just hate it when he shows his true middle-of-the-road stance?
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Old 11-06-2015, 10:57 AM   #2
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Not a big deal . . The economics did not work at today's crude price
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Old 11-07-2015, 08:12 PM   #3
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Not a big deal . . The economics did not work at today's crude price
Then why didn't TransCcanada just withdraw their application?

The cynic in me thinks they wanted it to be rejected so they could justify the vast expense they've incurred to their shareholders. But what do I know - maybe $100's of millions is peanuts to TC?
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Old 11-08-2015, 06:21 AM   #4
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They asked for the approval to be suspended, thus protecting their earnings. Once the project is killed, all deferred costs have to be written off and charged to current year earnings. My guess is that will be a big hit to their statements. If the approval was suspended, they would have a case to keep the deferred project costs on the balance sheet.

No insider knowledge, but that is common strategy when a very expensive project washes out.

The other advantage is to retain the value the project may have to an interested 3rd party that might want to take up the fight later. I expect they are working on an alternative project that might allow them to hold onto the deferred costs and apply to the new one. ( not easy, but with the financial impact, they will be grasping all available straws )

Fun and games!
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Old 11-08-2015, 02:40 PM   #5
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Not a big deal . . The economics did not work at today's crude price
Shale is to expensive right now to harvest since the Saudis won't cut back their production which is why, right now, gas prices are so cheap...

The keystone pipeline however I think they wanted to build it right now on the cheap while the costs are lower so when shale production picks up they will already have the infrastructure to move it
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Old 11-08-2015, 03:02 PM   #6
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Someone will now likely build a smaller pipeline to move crude from N. Dakota to Cushing . . ( Cushing south is already complete . . plenty of "big kids" playing there! ) but it would not have the political barriers a Canadian one had and could take advantage of the lower construction costs now.

It would have to be a consortium of producers since none of the "Big Kids" are playing up there now. Low prices are driving the bit players into bankruptcy now, so it is not going to be an easy to develop a viable consortium . . might take some of the majors to get interested. . . . ( Almost all pipelines in the US are joint ventures )

Thought it was interesting that Lindsay Graham and others wanting to make political hay out of the decision claim this is a boon to the OPEC countries that want to kill us. .
We currently import around 300 million BBls a month, less than 85 from OPEC and that number is dropping drastically. Canada is and will remain the country that we import the largest volumes from and it has been while since they wanted to kill us.

One would think Graham & Co. would know that, but facts that do not fit the narrative seem to fade from memory quickly
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Old 11-09-2015, 09:56 AM   #7
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That makes more sense, and as long as the Saudis continue to not drop production we will lose alot of the small players, which of course is their goal, but with an inintended side effect of further hurting the Russian oil economy... If we were smart would would increase our import purchases of oil for our reserves and grow them on the cheap from any outside source we can...
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