From: The Barrel
By John Kingston | September 12, 2012 09:30 AM
Big pipeline projects tend to get announced with much fanfare. That’s
not the case for Energy Transfer Partners, which is seeking to add one
more north-to-south crude oil pipeline to drain the upper Midwest and
Canada of its excess crude oil.
As reporting by Platts Meghan Gordon revealed, ETP has petitioned the
US Federal Energy Regulatory Commission to allow it to make changes to
its giant Trunkline natural gas line, which now runs south-to-north,
into the upper Midwest. (You can see a map of the line on ETP’s webpage here.)
For Trunkline to cut natural gas service to places like Michigan, FERC
would need to permit it. Some of the affected states are protesting the
move in front of FERC.
But the FERC move revealed the ETP plans in an indirect way, and it
appears ETP otherwise doesn’t want to talk about its project, as Meghan
reveals in her reporting. The company has put out no press release on
it; its media people won’t talk about it. Outside of the FERC filing,
there are no public declarations about the plans anywhere.
But they’ve talked to ETP equity analysts
about it. One analyst, who requested anonymity, said: “This is going to
be a huge project to reverse this line—hundreds of millions if not a
billion dollars. So you’re going to have to ship enough barrels so that
your cost per barrel is reasonable, competitive.” ETP has discussed the
project with this analyst.
So if all projects are completed, the market would have the Seaway
reversal (which already has begun), moving crude out of the Midwest to
the tune of 850,000 b/d by 2014. The southern tail of the Keystone XL
pipeline, formerly known as MarketLink but now called the Gulf Coast
Pipeline Project, is projected to start operations out of Cushing next
year with an initial capacity of 700,000 b/d on its way to 830,000 b/d.
It also includes a 130,000 b/d Houston lateral line from Port Arthur to
Houston. MORE
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