The Marcellus/Utica projects discussed so far focus exclusively—or at least primarily—on moving gas from the two shale plays to local gas distribution companies, industrial customers and power generators into nearby regions. Another subset of gas pipeline projects is aimed at moving Marcellus and Utica gas to new LNG export facilities being developed along the Gulf Coast.
Most of these projects involve reworking existing south-to-north pipelines to make them bidirectional and allow gas to move south. Others, like Columbia Gas Transmission's recently proposed $310-million, 34-mile Cameron Access pipeline to the Cameron LNG export facility now under construction in Louisiana, involve building new pipeline spurs to connect these now bidirectional mainlines to LNG exporters.
While a number of major gas pipeline projects are under construction or in the planning stage, other types of hydrocarbon pipelines are in the works as well. TransCanada's controversial Keystone XL pipeline, which would move western Canadian oil 1,200 miles from eastern Alberta to southern Nebraska, has attracted the most attention by far, in part because it would ease the delivery of oil-sands crude to market. But the $8-billion project—which remains in limbo, awaiting a final environmental assessment and U.S. State Dept. action—has always been only one of many proposed oil pipelines.
TransCanada Goes Big, Heads East
In fact, the largest North American oil pipeline now under development is TransCanada's proposed Energy East job. The $12-billion project by 2018 will convert to oil service some 1,800 miles of existing natural gas pipeline from Burstall, Saskatchewan, to Cornwall, Ontario, and add roughly 1,000 miles of new line at the eastern and western ends to allow delivery of oil from eastern Alberta to Quebec and New Brunswick.
The Energy East project is still working its way through the Canadian regulatory process. As with Keystone XL and other large pipeline projects, Energy East faces opposition from environmental groups, but TransCanada argues that it is safer—and better for the environment—to move oil by pipeline than by rail, the only other real alternative.
TransCanada also is planning the $600-million Upland Pipeline, which will move up to 300,000 barrels per day (MBbl/d) from the Bakken shale region in western North Dakota about 200 miles north to an interconnection with Energy East at Moosomin, Saskatchewan. Again, the developer hopes to have the pipeline online by 2018.
"I think we're in the middle of a multiyear build-out" of new oil pipelines needed to more efficiently deliver crude oil to market, says James O'Neil, president and CEO of Quanta Services, a major builder of oil and gas pipelines in the U.S. and Canada. "We're very bullish on this market" for oil pipelines. He's optimistic about the market for natural gas pipelines too.
Just this month, Quanta's Price Gregory International unit is starting installation of 79 miles of 36-in.-dia pipe for an oil link called Line 78 that Enbridge is developing between Pontiac, Ill., and Griffith, Ind.; the project will be completed this fall.
