Canadian exports, consistently the United States’ number one source of imported crude oil and refined products, have averaged almost 2.5 million barrels a day (mbd) so far this year. Pipeline supplies of crude oil to the Northern Tier – the area bordering Canada from the Great Lakes to the Pacific – are critical since most of that oil is the feedstock for the refineries in the Midwest.  Once the oil is refined into fuels – gasoline, diesel, jet fuel - it is distributed in a series of interconnecting pipelines throughout the region.  The growth in production from the oil sands in Western Canada will provide a long-term secure source of supply to meet the U.S. projected 15% growth in oil imports by 2020.  To transport this growing supply, several pipeline companies are working on capacity expansions.

Enbridge Pipelines

Enbridge Pipelines, the world’s longest crude oil and petroleum products pipeline system, is expanding its system in the U.S. as well as Canada.  The company is planning three expansion projects along its Lakehead System, the U.S. portion of its main line that stretches from Alberta, Canada through Pembina County, North Dakota and around the Great Lakes.  One of the projects, the Southern Access Program, includes an expansion of Enbridge’s crude oil pipeline system.   The first stage will include construction of 321 miles of new pipeline along the route of the Lakehead System in Wisconsin, scheduled for operation in 2008. (See accompanying map.) The second stage involves construction of 133 miles of new pipe within existing Enbridge pipeline easements from the Delavan pumping station near Whitewater, Wisconsin to Flanagan, Illinois and interconnecting with the Spearhead System west of Chicago.  Construction of an extension to Southern Access from Flanagan, Illinois to Patoka, Illinois, a traditional pipeline hub, is planned to begin next year and be operational in 2009. 

To address the demand for diluents, the light hydrocarbons required to transport heavy oil and bitumen being produced in increasing volumes from the oil sands in Western Canada, Enbridge has planned to construct the Southern Lights Pipeline.  The project is a planned petroleum pipeline that will transport diluents from the Chicago area through the Midwest to Alberta.  The 180,000 barrels per day pipeline will include new construction and use of segments of existing Enbridge pipelines that will be reversed for south-to-north service.  The pipeline is targeted to be in service by 2010. 
 
The Alberta Clipper, a proposed 1,000 mile crude oil pipeline from Hardisty, Alberta to Superior, Wisconsin, is Enbridge’s proposal to transport the growing supply from Western Canada.   The pipeline would increase the Enbridge system by 450,000 barrels per day and would feed into the Southern Access and Southern Lights projects along the existing pipeline route.  Construction for the Alberta Clipper system will begin once Southern Access and Southern Lights are completed.

Just as oil sands production is increasing to the North, increased oil production in the U.S. Rocky Mountains and North Dakota has also led to the need for the construction of new pipelines to move oil east.  To meet the increased crude oil production in North Dakota and Montana Enbridge is expanding its North Dakota System.  The expansion will improve access to the company’s Lakehead System and the project includes new or upgraded pump stations, additional tanks and a new 52 mile pipeline segment parallel to existing gathering pipe, increasing capacity by up to 45,000 barrels per day year-round.    

TransCanada Keystone Pipeline

The TransCanada Keystone Pipeline is a competing system to Enbridge’s Southern Access Program.  More than 1,800 miles of crude pipeline is to be constructed from Hardisty, Alberta to Patoka, Illinois with a capacity of 435,000 barrels a day. 

Approximately 1,070 miles of the new pipeline will be constructed in the U.S., a majority of which will be set along existing utility corridors.   In addition, the project will include 230 miles of new pipeline in Canada and the conversion of 530 miles of existing TransCanada pipeline from natural gas to oil transmission.  The conversion has been approved by the National Energy Board of Canada.  TransCanada has also announced a 291 mile extension of its pipeline from the Nebraska/Kansas border to Cushing, Oklahoma, an increase in capacity from 435,000 barrels per day to 590,000 barrels per day.  This line will also make use of existing rights-of-way wherever possible. The pipeline is planned to be in service in 2009. 

Kinder Morgan Canada

Kinder Morgan Canada, formerly Terasen Pipelines Inc., has expansion phases under way to increase capacity on its 715-mile Trans Mountain pipeline which supplies most of the petroleum products in British Columbia’s lower mainland and refineries in Washington State with crude oil.  The project includes expansion of the Trans Mountain pump station and “looping” the existing pipeline (i.e., adding a parallel segment) to create a dual pipeline system.  The Anchor Loop, which will increase capacity from 260,000 barrels per day to 300,000 barrels per day by the end of 2008, involves looping a 98-mile segment of the existing pipeline between Alberta and Jackman, British Columbia and the addition of two new pump stations. 

BP Pipelines

BP Pipelines (North America) is gearing up for an open season for a proposed pipeline reversal project that would deliver light Canadian crude from the Chicago area to Cushing, Oklahoma.  With adequate shipper support, reversal of the existing 600-mile long crude oil pipeline, referred to as the BP No. 1 Pipeline, could be in service in mid-2009.

Minnesota Pipeline Company, LP

Minnesota Pipe Line Company, operated by Koch Pipeline Company, LP, is working on constructing the MinnCan Project.  From its origin in Clearbrook, Minnesota the 300-mile pipeline will follow a southeasterly route to the Flint Hills Resources Refinery in Rosemount, Minnesota, skirting south of the Twin Cities on its way.  From Rosemount, it will connect through an existing pipeline to Marathon Petroleum Company’s St. Paul Park Refinery.  Upon completion of the line, 165,000 barrels per day could flow to supplement an existing line which is now at capacity.   Slightly more than half of the pipeline would run along an existing pipeline, with the rest along a new right-of-way that follows an existing road.  The Minnesota Public Utilities Commission approved both the certificate of need and the route of the pipeline.  Construction is scheduled to start in mid-2007.   

Note: For more information on the Alberta Oil Sands development, see http://www.ags.gov.ab.ca/activities/CBM/alberta_oil_sands2.html