Canadian Crude Oil Exports Decline On Keystone Pipeline Leaks
Canadian crude oil exports fell 2.4 percent in November as the United States dropped imports from its northern neighbor to 3.26 million barrels per day, according to a new report by Reuters.
An 80,000-bpd drop came as the Keystone pipeline was forced to shut down following a leak in South Dakota a couple of months ago. Since then, the TransCanada line has resumed operations, but capacity has been curtailed 20 percent owing to orders by U.S. regulators.
Canada has also ramped up its purchases of American crude, tallying a 127,000-bpd increase in November to a total of 413,000 bpd. The country also imports from Saudi Arabia, Nigeria and Norway, data from last year shows.
The existing Keystone pipeline, which could be upgraded to the controversial Keystone XL pipeline, leaks more often and more oil than TransCanada Corp predicted in communications to regulators and lawmakers during approval hearings, according to an earlier report by Reuters.
“They testified that this is going to be a state-of-the-art pipeline,” one of South Dakota’s Public Utilities commissioners, Gary Hanson, said in November. “We want to know the pipeline is going to operate in a fashion that is safe and reliable. So far it’s not going well.”
Nebraska cleared one of the last hurdles for the Keystone XL pipeline last year. The state’s Public Service Commission voted 3-2 in favor of the project, which would give TransCanada permission to build the pipeline through the state. Nebraska had been the last thorn in Keystone XL’s side after the Trump administration gave the greenlight earlier this year.
But while the approval is a massive victory for TransCanada – share prices surged nearly 2 percent immediately after the announcement – the firm still needs to make a final investment decision on the project, and the oil market is dramatically different than it was a decade ago when the project was initially drawn up.
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