Letter: Observers question need for pipeline
Much has been written and debated recently concerning the proposed placement of the Sandpiper oil pipeline across our vulnerable lake country and its highly susceptible aquifers. However, could we have that proverbial "cart before the horse"? Now we are discovering that the actual need for this pipeline is being questioned from within the oil industry.
Enbridge and Canada's New Democratic Party claim the Sandpiper will result in "increased pipeline capacity to transport growing volumes of North American crude petroleum" leading to "increased flexibility ... benefiting regional refineries and consumers." Apparently many oil shippers and local refineries do not agree. According to a protest by shippers of a proposed Enbridge surcharge posted to the Federal Energy Regulatory Commission by St. Paul Park Refining Co. "... the proposed expansion pipeline and expansion surcharge (a) are not needed, (b) do not have broad shipper support, and (c) will provide no benefit to shippers ..."
Another company protesting with FERC, Concord Energy, a major oil shipper, states that during the most recent open season allowing shippers to commit to use of this pipeline, only 15 shippers - 8 percent of the total number of shippers on the NDP pipeline - were sufficiently interested. Concord Energy states: "It is clear that NDP's current petition represents an effort by the pipeline to use the commission's processes to require captive shippers to finance and pay for a project that a majority of the shipping community does not want or need."
One can see how existing shippers, who use NDP pipes to carry oil to Clearbrook, would cry foul at NDP for attempting to build, on their backs, a pipeline that they agree is unnecessary. SPPRC, being one of two main refineries in Minnesota further points out "the effect will be to increase the refined product prices paid by the customers of SPPRC." That's us.
SPPRC and other shipper parties have expressed serious doubts that the proposed expansion pipeline is necessary.
Their studies show that "there will be more than 2.25 million barrels per day (bpd) of takeaway capacity (pipelines, rail and North Dakota refineries) in place by the end of 2015, prior to Sandpiper's proposed start. The NDP's own study adopts a production forecast indicating that Bakken production will peak at approximately 1.4 million bpd in the 2025-27 time frame, after which it will decline. Thus, there will continue to be sufficient takeaway capacity to handle all of the current and future Bakken production through the 2035 period, leaving no logistical need for the Sandpiper Project."
Either Enbridge is building a "house of cards" or they are being disingenuous by trumping false demand from Bakken as a cover for their real intention, to ship dirty tar sands oil from Alberta to "downstream markets" on the East Coast or outside the U.S. Think they can't? Enbridge's subsidiary, Tidal Energy Marketing, has obtained a license from the U.S. government to re-export Canadian oil from U.S. shores.
Minnesotans would be required to take on all the risks with none of the benefits.