Sunday, August 30, 2009

Alberta Clipper

Canada is hard at work providing heavy crude oil to the U.S. This article reports the U.S. approval of the Enbridge Alberta Clipper project (Link to project details). According to Enbridge the pipeline will carry 450,000 bbl/day in addition to another 1.6 bbl/day carried by other pipelines.

What does this mean to projects like the Alaska Gas Pipeline? - Nothing directly other than we should take note of the ongoing current and future demands for gas to fuel extraction of oil from the Canadian tar sands. Oil extraction requires about 1 BTU of energy for every 6 BTU of oil produced.

By my estimation production of 450,000 BOE/D tar sand oil requires about 435 MMSCFD of gas or about one tenth of the capacity of the Alaska Gas Pipeline. That gas has to come from somewhere and it might as well be from Alaska.

Projects like the Alberta Clipper and the Keystone Pipeline (500,000 bbl/d) point to the need to supply the Canadian Tar Sand projects with natural gas for the long term.

Maybe $2.75/MMBTU shale gas from East Texas can do the job, but then again maybe not.

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