Shell cancels oilsands project over lack of pipeline capacity

[Cory1]

I think it's got less to do with pipeline accessibility/capacity then they want us to think.

We were contracted by shell to design and build pipelines from the CC facility to a major oil hub in alberta where they had already signed pipeline capacity and transport agreements to a major refinery on the gulf.

They already delayed the project a year citing oil prices, put the P/L project on hold 6 months ago, now they come out indicating its due to lack of capacity and market accessibility.... I call bs if oil $100US/bbl they'd still be moving forward and find a way to get it to market with existing capacity.

Blaming low oil prices won't get them anywhere so instead they put the pressure the government on to approve some of the mega pipelines which would benefit all of thier existing operations.

[Penner]

This project was killed back in March of this year. Only now being released officially to the public.

Need 1 of the 3 P/L's or a Upgraders to be built. Oil at $80BBL wouldn't hurt either. Dollar where it is at is a good thing.

[Okotokian]

Originally Posted by hal53

The fact that the budget didn't have anything in it regarding pipelines, or anything to stimulate the oil patch , could as well have been the reason they said to heck with it we'll spend money elsewhere....

Well if they cancelled because they didn't get a handout, I say GREAT, the cancellation was long overdue..

[hal53]

Originally Posted by 79ford

Nah, actually at home reading a book called sucker rod pumping hand book : production engineering fundamentals and long stroke pumping by Gabor Takacs. i generally dont mix my upstream information hobby with work, it wouldnt be fair to the corporation.

I would say the fact rail car shipping in a low commodity price environment doesnt make sense has more to do with the project cancellation than lack of pipeline capacity...... if oil were 100$ right now Shell would be building that project and loading it on a train then worrying about the pipeline later.

Like Shell says, they got money and some projects are looking better right now. Tarsands at 30$ barrel isnt one of the good ideas Shell is making a good decision right ol buddy?

Attaboy!, keep reading, I like listening to guys who have read a book and are now experts on a given subject without ever getting their hands dirty.....

[ESOXangler]

Shell prefers the easy money of Nigeria. Those Dutch corporations aren't all that different from the Belgiums when it comes to extracting resources! north American production is under too much scrutiny for them to be comfortable!

[loyaleddie]

Originally Posted by Bluedog

SHELL can only blame themselves, They engineered a big white Elephant!
DUE TO OVERWHELMING INCOMPATANCE!

Agreed...

Pretty somber all around camp today

[levigne25]

Originally Posted by fish_e_o

pipelines are the safest way to transport oil we should all be pushing for it

Say no to keystone pipeline , if there are no pipeline then they have to build more refineries , more refineries more work here , More maintenance/shutdowns . Pipeline only brings temporary work

[loyaleddie]

Originally Posted by igorot

Its not a white elephant as it was not canceled or abandoned, it was place on hold. There is a big difference. Not sure about "incompatance"

Ummm...yup it very much done....

[raab]

Originally Posted by levigne25

Say no to keystone pipeline , if there are no pipeline then they have to build more refineries , more refineries more work here , More maintenance/shutdowns . Pipeline only brings temporary work

Still need pipelinesto get the refined products to market...

[Dog hunter]

We are cutting a 66km pipeline right of way north of wab this winter, thats all i know

[levigne25]

Originally Posted by raab

Still need pipelinesto get the refined products to market...

So your saying that can't be done without the keystone pipeline ?

[hal53]

Originally Posted by levigne25

So your saying that can't be done without the keystone pipeline ?

Where are you going to build your refinery?

[Ice Fishing Maniac]

Originally Posted by Penner

This project was killed back in March of this year. Only now being released officially to the public.

Need 1 of the 3 P/L's or a Upgraders to be built. Oil at $80BBL wouldn't hurt either. Dollar where it is at is a good thing.

Don't think so. I had people onsite from June till just last week. We finished up. Structures were being erected, well pads were being built, rigs were drilling.

Yes engineering redesign -can't design a facility to work down in New Orleans and expect it to be the same in northern Alberta; and oil price delayed the project as as announced back in the spring. Some prep work was still being done. Talk was 2017-2018. Now it's sounds like full shut down indefinitely.

Sure going to hurt local businesses and the new hotels that just opened (Chateau Nova) along with others. Some new commercial / industrial shops being built.

Doesn't help either Baytex and Murphy and Penn West cutting back big time in the Seal Lake operations as well.

So much for the 2 new local rail car loading facilities that were built in the last 2 years.
Same with the new rail car storage loading/unloading of Carmon Creek facility structures that was built at the DMI pulp mill in summer of 2014.
It will be a long slow winter for a lot of people in Peace River and surrounding areas.

[rry]

Rail is the worst form of transportation for oil.... Pipelines are the safest way to transport oil no questions...

[Kim473]

Originally Posted by rry

Rail is the worst form of transportation for oil.... Pipelines are the safest way to transport oil no questions...

And how traffic would be effected with shorter trains traveling through the cities?

If the polititions were smart, they would make some tax reliefs for these companies and pipe lines would be on the go across the country. And a few refineries would be half built. Just think of the jobs created if these things were on the go. 10's of thousands ! Canada could be self supported in reguards to energy in less than 10 years. Spend less money on refugees and bankrupt/poor countries and put it towards tax refief for these projects.

We need somebody like Defenbaker to lead this country again for 10 years, someone that doesn't have there hands in there pocket and head up there butt.

[propliner]

There gonna ragret there incompatance lol. I can't read this anymore.

[jip911]

Having been directly involved in this project for over 2 years now there are snippets of fact in half the posts here...
This project has been plagued with engineering delays and re-designs since day one and portions of this project (oil/water treating) have been on hold for quite some time.

The power generation portion has been forging ahead albeit slower than initially forecasted while engineering has worked out how to modify the design to operate without the rest of the facility being constructed. The turbines will be run in simple cycle which means this will be very expensive power to generate...

All I can say about "pipeline capacity" is like many things in life.... Don't believe everything you read in the paper...

J

[Brandon5555]

Originally Posted by CaberTosser

It would be a good time to build while fuel prices are low and contractors are hungry for work, the labor pool is deep and margins a little more enticing.

I noticed after the election that CP's stock had a solid bump up, if pipelines are to be hamstringed then rail is a solid investment.

Hard to say. Snotley was going on about the fancy pipeline going east. If that goes through won't be much need for oil trains considering they go from hardisty straight to Chicago.

[Brandon5555]

Originally Posted by rry

Rail is the worst form of transportation for oil.... Pipelines are the safest way to transport oil no questions...

Actually it's not the worst. Sure Lac magantic was bad but it wasn't because of "rail transportation". It was because of a grey area in leaving trains unattended. Allot has changed since believe it or not. What if some wackadoodle blew up a pipeline with an ied near a town? Same kind of result. Just as likely to happen

[Penner]

Originally Posted by Ice Fishing Maniac

Don't think so. I had people onsite from June till just last week. We finished up. Structures were being erected, well pads were being built, rigs were drilling.

Trust me they killed it in March when they put the brakes on everything substantial hoping for good news on either the P/L's or the price per BBL which hasn't materialized. Skeleton work up until now was being completed on things that Shell already committed to as well as to bring it to a point where they can stop everything as cleanly as possible.

[Penner]

Originally Posted by rry

Rail is the worst form of transportation for oil.... Pipelines are the safest way to transport oil no questions...

I would suggest ocean tankers would be the worst with rail being a close second for 2 reasons. Way easier to clean up a oil spill on land than on/in water. Alberta oil may not be as GHG friendly interms of what energy it needs to be extracted so its considered "dirty oil", but most people don't realize that much of ocean tanker oil is produced where hundreds of thousands of people have had their blood spilled for that oil to be exacted "bloody oil". At the end of the day both oils produce the same GHG emissions coming out of our tailpipes.

Because ocean tanker or "bloody" oil doesn't come from our backyard (not in our immediate line-of-sight), that its likely impossible to stop "bloody oil" from happening, and because nowadays its hip to be pro-green, people of the world who wear granola lined panties then focus on Alberta oil.

[Penner]

Originally Posted by levigne25

So your saying that can't be done without the keystone pipeline ?

Energy East is best for Alberta and Canada. Screw Hillary!

[Apex162]

Does someone know who did the engineering on this job?

[rry]

Originally Posted by Penner

I would suggest ocean tankers would be the worst with rail being a close second for 2 reasons. Way easier to clean up a oil spill on land than on/in water. Alberta oil may not be as GHG friendly interms of what energy it needs to be extracted so its considered "dirty oil", but most people don't realize that much of ocean tanker oil is produced where hundreds of thousands of people have had their blood spilled for that oil to be exacted "bloody oil". At the end of the day both oils produce the same GHG emissions coming out of our tailpipes.

Because ocean tanker or "bloody" oil doesn't come from our backyard (not in our immediate line-of-sight), that its likely impossible to stop "bloody oil" from happening, and because nowadays its hip to be pro-green, people of the world who wear granola lined panties then focus on Alberta oil.

Sorry I should have stayed land transportation across North America...

[raab]

Originally Posted by Penner

I would suggest ocean tankers would be the worst with rail being a close second for 2 reasons. Way easier to clean up a oil spill on land than on/in water. Alberta oil may not be as GHG friendly interms of what energy it needs to be extracted so its considered "dirty oil", but most people don't realize that much of ocean tanker oil is produced where hundreds of thousands of people have had their blood spilled for that oil to be exacted "bloody oil". At the end of the day both oils produce the same GHG emissions coming out of our tailpipes.

Because ocean tanker or "bloody" oil doesn't come from our backyard (not in our immediate line-of-sight), that its likely impossible to stop "bloody oil" from happening, and because nowadays its hip to be pro-green, people of the world who wear granola lined panties then focus on Alberta oil.

Rail isn't that bad. Theres been a lot of changes since lac megantic. If a railcar goes off the rails you know immediately and response happens right away. With a pipeline its my understanding that it can spill several thousands of litres before a sensor will report the problem. Pipeline is definitely more efficient but safer I'm not so sure.

[hal53]

Originally Posted by raab

Rail isn't that bad. Theres been a lot of changes since lac megantic. If a railcar goes off the rails you know immediately and response happens right away. With a pipeline its my understanding that it can spill several thousands of litres before a sensor will report the problem. Pipeline is definitely more efficient but safer I'm not so sure.

How many pipelines run right thru the middle of every city/town on their route?

[Bluedog]

Originally Posted by Apex162

Does someone know who did the engineering on this job?

SHELL did most of it themselves in the NEW ORLEANS office.........LOL
Jacobs in Houston and Calgary helped.
Its a crying same we let these Dutch b@$t@*ds operate in our country!

[raab]

Originally Posted by hal53

How many pipelines run right thru the middle of every city/town on their route?

I guarantee more then you think there are. Pipeline signs everywhere around edmonton. And as I said before I don't think it's that dangerous right now. They take several safety precautions with crude trains to ensure they arrive to the customer safely. Train is definitely less efficient but I don't think it's much more dangerous then pipeline if we're talking from a straight safety standpoint.

[hal53]

Originally Posted by raab

I guarantee more then you think there are. Pipeline signs everywhere around edmonton. And as I said before I don't think it's that dangerous right now. They take several safety precautions with crude trains to ensure they arrive to the customer safely. Train is definitely less efficient but I don't think it's much more dangerous then pipeline if we're talking from a straight safety standpoint.

I said every city/town on their route, not a gathering point to a refinery row like Edmonton is....and if you're talking from a straight safety stand point...you're wrong...

[raab]

Originally Posted by hal53

I said every city/town on their route, not a gathering point to a refinery row like Edmonton is....and if you're talking from a straight safety stand point...you're wrong...

Why do you think it's more dangerous by rail?