north american pipelines

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North American Pipelines

January 12, 2017

Golden Age Investment Club

Sources of Oil and Gas US Sources and Consumers of EnergyMajor Trends: Coal to Renewables & Gas (Utilities)

Petroleum to Electrical (Private Cars)

CO2 emissions 2015 USA

Trend: Convert Coal to Natural gas

CO2 EmissionsCoal vs Natural Gas

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Current Cost of Tar Sands Oil Natural Gas content US$3/bbl

Cost of new Oil Sands ProjectsNational Post January 22, 2015

Current production 2,400 b/dOil & Gas Journal April 4, 2016

>64 projects cancelled since 2014800,000 b/d under construction

US - Sources of OilEagleville TX 238 mm barrels (vs 80B largest in the world)

Spraberry TX 99 mm barrelsPudhoe Bay AK 79 mm barrels

Oil Pipeline ProposalsExceed additional production of 850,000 b/d by 2021 by a wide margin

Oversupply will contravene Paris Agreement

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Proposed New Capacity2,960,000 b/d

• Kinder Morgan– Trans Mountain 890,000 b/d from 300,000. Export to

Far East

• Enbridge– Line 3 760,000 b/d from 380,000. US Mid-West– Line 9B reversal 300,000 from 240,000. Eastern

Canada and Export to Europe

• Trans-Canada– Keystone XL 590,000 b/d. US Mid-West– Energy East 1,100,000 b/d. Eastern Canada and

export to Europe

Environmental Issues

• Kinder Morgan– Trans Mountain

Orca’sDangerous shipping lanes and frequent ferriesResidential communities nearby

• Enbridge – Dakota Access

Standing Rock protests, Army Corps engineer environmental review Missouri river crossing

– Line 3 expansion Appeal Assembly of First Nations

• Trans-Canada – Energy East

St. Lawrence river crossing in Quebec, Major of Montreal

US – Sources of Natural GasMarcellus 2836B CuFT

Newark TX 1951B CuFTHainesville LA 1425B CuFT

San Juan CO&NM 1025B CuFT

Natural Gas PipelinesNot affected by overseas supplies … yet

West to East mainline oversupplyPacific NW LNG

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Columbia PipelinesAcquired by Trans Canada

Spectra Energy PipelinesAcquisition by Enbridge pending approval

2007-2011 Natural Gas Prices Natural Gas vs Oil per mmBTUThese lines will likely converge again