Speaking in Hawaii, the Canadian Prime Minister (who met with the Chinese President while on the island) said:
“This does underscore the necessity of Canada making sure that we’re able to access Asian markets for our energy products, and that will be an important priority of this government going forward,”And to emphasize the point, while the Canadian Finance Minister has noted that the pipeline plan itself might not survive the delay. TransCanada Corp, who were to operate the pipeline has to retain its customers, even as the Finance Minister flies to China to market energy exports, and perhaps sell the available supply to China. And in the broader scheme of things:
Canada will seek to join a new Asian trade block as it tries to increase energy exports to the region following the U.S. decision to delay approval of TransCanada Corp.’s $7 billion Keystone XL pipeline, Prime Minister Stephen Harper said.To recap from the earlier posts in the OGPSS series on Canadian pipelines there are plans by Enbridge to build a “Northern Gateway” pipeline from the oil sands to the West Coast. And this has already found support from China. Given the irritation that the United States has just provided the Canadian Government it is worth repeating the comment by the President of Enbridge:
I challenge any of you to name one other country in the world that only has one market for its largest export. Right now our most valuable resource is landlocked in North America and isolated from the world market. That means it is often isolated from world price. The August spread between West Texas Intermediate and Brent Crude, the world price, was $22 per barrel. Canadian heavy crude has more often than not sold at a discount to U.S. light crude that goes well beyond the quality differential – simply because of lack of market.It should not be forgotten in this debate that the greatest objection to the pipeline seemed to come from Nebraska. Lest you forget Nebraska is the largest producer of corn ethanol west of the Mississippi River. It has 34 ethanol plants, converting 769 million bushels of corn a year into 2 billion gallons of ethanol. (The equivalent of 130 kbd out of the national production of around 900 kbd).
Official map of the planned pipeline from the Department of State.
TransCanada Keystone Pipeline, LLC (Keystone) is proposing to construct and operate a crude oil pipeline from Hardistry (Alberta), Canada to Patoka, Illinois (view map of project). The pipeline will be able to deliver 435,000 barrels per day (bpd) of crude oil to existing terminals in Missouri (Salisbury) and Illinois (Wood River and Patoka). The system capacity could be expanded in the future up to 591,000 bpd.
The proposed project includes 1,073 miles of new pipeline in the U.S. (Keystone Mainline). The Keystone Mainline will be comprised of 1,018 miles of 30-inch diameter pipeline from the Canadian border to Wood River, Illinois and 55 miles of 24-inch diameter pipeline from Wood River to Patoka, Illinois. Keystone may also construct an additional pipeline segment from near the Nebraska-Kansas border to Cushing, Oklahoma consisting of 291 miles of 30-inch diameter pipeline.