Surerus Murphy Has Begun Hiring For Kamloops Section Of Trans Mountain Pipeline

While they are still waiting on approval, Calgary-based contractor, Surerus Murphy, has begun searching for workers to assist in construction on the 5A section of a pipeline, the Kamloops and Merritt pieces. According to Heather Eddy, company director of Human Resources and development, construction is estimated to take around 30 to 34 months.

Heather stated, “when we’re fully ramped up we’ll have over 600 people working on our section of the pipeline,” and that they “really do intend to hire as many local and Indigenous employees as possible.”

The hiring process for some of the upper level positions within leadership and administration as well as the search for sub-contractors has already begun.

The start date, as well as specific job numbers for the project, are still unknown. However majority of jobs available will be for laborers and operators. Other various jobs needed will be mechanics, welders, environmental advisers, health and safety personnel, human resource and procurement specialists. Heather Eddy and her team are currently taking resumes for all positions in order to keep on file for when they are ready to start hiring.

Surerus Murphy will require all workers for the project to be trained in pipeline construction safety through a classroom course that is normally around $100 to $125.

Source: Kamploops Matters

Total Plans To Purchase LNG From Tellurian’s Driftwood Project

On Wednesday, Tellurian Inc. reported that parts of French oil major Total SA will be buying one million tons per annum (mtpa) of LNG from the $30 billion Driftwood export project in Louisiana. Total plans to purchase an extra 1.5 mtpa of LNG from Tellurian’s off take volumes, invest $500 million in Driftwood Holdings LP, and buy about $200 million of Tellurian shares.

The Driftwood Pipeline LLC, controlled by Tellurian, has been looking into the construction of a pipeline that would deliver gas to the Driftwood LNG facility. It would run 96 miles in length, consisting of 74 miles of 48-inch pipe, and transport 4 bcf/d of natural gas on average to the facility. The expected production by Driftwood is about 4 billion cubic feet per day (bcfd) of natural gas, which is enough energy for about 5 million U.S. homes for a day.

If Tellurian’s final investment decision is made in 2019, the Driftwood plant could begin service in 2023. When the final decision is made, Total’s aggregate investment in Tellurian is estimated to be around $907 million.

According to the U.S. Energy Information Administration, Total’s world demand for LNG is expected to rise by almost 100 mtpa by 2023. Currently their demand sits at a record high of 316 mtpa.

Tellurian is unique among most U.S. LNG export projects as they offer customers the ability to invest in a full range of services, such as production, pipelines and liquefaction.

Pipeline & Gas Journal

Plains Midstream Now Expanding Formerly Leaked Pipeline

Years after two large oil spills and a $1.3 million fine, Plains Midstream Canada has recently announced plans to expand its Rangeland crude oil pipeline that spreads from Edmonton, Alberta to the U.S. Border.

Plains Midstream Canada’s plans include doubling capacity between Edmonton and Sundre to 100,000 bpd and increasing their system that starts in Sundre and continues south to the border from 20,000 bpd to 100,000. These expansions will be subject to acquiring permits and regulatory approvals and are set to begin minor services later in 2019 and full services in 2021. The new expansions should connect to projects in Montana and Wyoming and eventually deliver crude Canadian oil to Texas.

Plains Midstream's website states that the company has spent $110 million on environmental cleanup efforts for both of their oil spills in 2011 and 2012.

Source: BNN Bloomberg

Cheniere’s Sabine Pass Storage Tanks Shut Down

Recently, two Louisiana Sabine LNG storage tanks leaked on the Sabine Pass export terminal. Consequentially, U.S. Energy and safety regulators, such as the U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration (PHMSA) and the Federal Energy Regulatory Commission (FERC), denied authorization for Cheniere Energy Inc. to return these tanks back to service.

Discovered on January 22, 2018 by some plant workers was a 1 to 6 foot long crack in one tank leaking into an outer layer. Cheniere’s two tanks were quickly shut down by PHMSA on February 8, 2018 and they were told by agencies that any service returned to a tank before safety requirements were met would be at their own risk.

While Cheniere agreed in April of 2018 that they would begin correcting issues, regulators have reported that the company has “failed to comply" in some instances of testing equipment and providing documentation.

Cheniere claims they have “been responsive and forthcoming throughout this process and will continue to be,” and they “will provide a formal response” to the claims agencies have made about them.

In order for Cheniere to return the tanks to service, a structural re-inspection of all five LNG storage tanks in Sabine, capable of holding 17 bcf, and an installation of specific devices to alert them of leaks is required.

Source: Reuters

Plains' Canadian Pipeline Expansion Will Connect To Texas

Plains All American has proposed pipeline expansions in Canada, Montana and Wyoming in order to connect to the $2.5 billion Red Oak pipeline system that Houston’s Phillips 66 and Plains are building from Oklahoma to Houston, Beaumont and Corpus Christi. While the Keystone XL pipeline project is still fighting legal battles, these expansions, set to complete in 2021, would allow more Canadian crude oil to reach Houston and the Gulf Coast.

Tyler Rimbey, executive Vice President for Canadian Plains stated, “We remain focused on leveraging our existing systems in creative ways to meet the growing needs of our customers.”

The reasonably priced expansions include Plains’ Western Corridor pipeline in Montana and Wyoming to grow as well as their Rangeland Pipeline, running from Edmonton to the U.S./Canadian border, to increase by 2X.

The Red Oak pipelines will be located from an oil storage hub in Cushing, Oklahoma to Wichita Falls, Texas and handle a mix of Canadian and Texas crude oil. From Wichita Falls, the pipelines should connect to systems from the Permian Basin, then lead towards Sealy and onwards to different refining and port hubs in Corpus Christi, Ingleside, Houston and Beaumont.

Houston Chronicle

Dominion Canceling Sweden Valley NatGas Project

Dominion Energy has pulled the plug on its $48 million Sweden Valley natural gas project, citing a protracted approval process by the FERC as the reason.

The Marcellus shale natural gas project from Pennsylvania to markets in Eastern Ohio will fall short on its contractual demands for its gas.

In a letter to FERC, Dominion said that the environmental assessment issued last August concluded "if Dominion constructs and operates the proposed facilities in accordance with its application and supplements, and the staff's recommended mitigation measures below, approval of the Project would not constitute a major federal action significantly affecting the quality of the human environment."

A former FERC commissioner said in an email that "in many cases, pipeline applicants request decision dates in order to be able to meet construction schedules and fulfill contractual obligations to the shippers who will transport natural gas using the newly constructed pipeline capacity."

Pipeline Tech Journal

Kinder Morgan Announces Pipeline Expansion in North Dakota

Kinder Morgan announced that the company is evaluating how much more capacity it will need to expand the Hiland Crude system based on the level of interest and the volume commitments it secures.

It's the third announcement of a major pipeline project in the state over the past month for carrying more Bakken oil out of North Dakota.

Currently, Hiland Crude system carries 88,000 barrels of oil each day from McKenzie County to Wyoming. From a hub there, Tallgrass Express transports up to 375,000 barrels per day to three refineries and a terminal in Oklahoma with its Pony Express Pipeline.

Tallgrass may also consider expanding the Pony Express line, Kinder Morgan spokeswoman Katherine Hill told the Bismarck Tribune.


Enbridge Announced Open Seasons on Express Pipeline

Open seasons for existing and expanded capacities on the Express Pipeline Limited Partnership pipeline in Canada has been announced by Enbridge Inc. The service originates at Hardisty, Alberta and has delivery points on the Express Pipeline LLC pipeline in the US.

"Given the shortage of pipeline capacity out of the Western Canadian Sedimentary Basin, Enbridge has been exploring options to provide industry with incremental near-term capacity," said Guy Jarvis, Executive Vice President Liquids Pipelines. "The efficient expansion capacity on the Express Pipeline being offered in this open season will provide additional takeaway capacity, which we believe will be well received by the shipping community."

The open season for existing capacity will begin at 8 am MDT on 3 July 2019 and end at 12 pm MDT on 7 August 2019 and the open season for expanded capacity will begin at 8 am MDT on 3 July 2019 and end at 12 pm MDT on 23 August 2019.


Binding Open Season Announced for the Keystone Pipeline

TC Energy, formerly known as TransCanada has announced an open season to solicit binding commitments for crude oil transportation services on the Keystone Pipeline System.

The pipeline runs from Hardisty, Alberta to markets on the US Gulf Coast.

Interested parties may submit binding bids for transportation capacity during the open season that will close at 12 pm MT on 19 July 2019.


Open Season Announced for Saddlehorn Pipeline Expansion

Saddlehorn Pipeline Company, LLC has announced the expansion of Saddlehorn pipeline and has launched an open season to solicit long-term commitments for capacity on the pipeline system. The company will also add the new Ft. Laramie origin by leasing capacity on third-party pipelines.

The pipeline’s current transportation capacity is 190,000 barrels per day of crude oil and condensate from the DJ and Powder River Basins to storage facilities in Cushing, Oklahoma owned by Magellan and Plains. The expansion will increase pipeline’s capacity by up to 100,000 barrels per day, which will mark a new total capacity of 290,000 barrels per day.

Following the addition of incremental pumping and storage capabilities, the higher capacity is expected to be available in late 2020. The company announced that interested customers must submit binding commitments by 12:00 p.m. Central Time on 31 July, 2019.


UGI to Buy Assets from TC Energy for $1.28 Billion

UGI Corp, a Pennsylvania based energy distributor would buy some assets of Columbia Midstream Group from TC Energy Corp, formerly known as TransCanada. The deal is set for nearly $1.28 billion to expand UGI’s midstream business.

“This transaction expands our midstream capabilities in the prolific gas producing region of the Southwest Appalachian Basin and provides an initial investment into both wet gas gathering and processing,” John Walsh, the chief executive officer of UGI, said.

With this deal, TC Energy could help finance the oft-delayed and controversial Keystone XL pipeline project and the new high-profile Coastal GasLink system project. These projects are likely to generate higher returns than these legacy assets.

Columbia Midstream Group operates in the Appalachian Basin and owns four natural gas gathering systems. It also has an interest in a company with gathering, processing and liquids assets, and a pipeline that runs through western Pennsylvania, eastern Ohio and northern West Virginia.


Open Season Announced for Bakken Crude Transportation

A binding joint tariff open season to solicit commitments for crude oil transportation service was announced by Kinder Morgan and Tallgrass Energy.

The crude oil transportation services starts from Bakken origin points on the Hiland Crude system, which is currently capable of moving approximately 88,000 barrel per day from Bakken origin points to Guernsey, WY.

Then through the Pony Express system, which is currently capable of moving approximately 375,000 barrel per day from Guernsey to Cushing, OK, connecting to three refineries along the way.

The binding open season begins July 1, 2019, at 4 p.m. Central Time and is expected to end on July 28, 2019, at 5 p.m. Central Time. Upon completion of a confidentiality agreement, additional documents and details related to the open season will be made available.


Cactus II Oil Pipeline to Begin Line Fill in a Week

Plains All American Pipeline LP’s Cactus II oil pipeline system will commence line fill within a week, a source with direct knowledge of the matter said. The Cactus II has the capacity of 670,000 barrel per day and runs from Permian Basin to the Corpus Christi, Texas area.

Cactus II project is progressing on schedule for initial service by the end of the third quarter of 2019, the pipeline operator said last month. Commodities merchant Trafigura signed a long-term agreement with Plains last year to transport a total of 300,000 bpd of crude and condensate on the Cactus II pipeline.

“We have over 90% of the pipe in the ground and we’re working diligently toward completion,” a company executive said during its investor day about two weeks ago. Concho Resources Inc., and Anadarko Petroleum Corp are the other two shippers on the Cactus II line.


$145 Million Deal to Buy Shell Canada Gas Assets by Pieridae Energy

Pieridae Energy, based in Canada will buy gas assets from Royal Dutch Shell for 145 million, Pieridae said on Wednesday. This will secure supply for Pieridae’s proposed Goldboro LNG plant in Nova Scotia, which will be Canada’s first east coast LNG project, producing 10 million tons per year.

“Not only does this deal help us secure the remaining conventional natural gas supply needed for the first train of the Goldboro LNG project, it makes Pieridae a major player in the Alberta midstream and upstream industry,” said Pieridae Chief Executive Alfred Sorensen.

All of Shell’s midstream and upstream assets in the southern Alberta Foothills area is included in the deal and these assets will produce 29,000 barrels of natural gas, natural gas liquids and condensate. Also Shell said in a statement that Pieridae will retain all site-based Shell employees and some Calgary-based employees who support the Foothills assets.

“We are pleased they (the assets) are going to a buyer with a strong focus on safety, community and environmental stewardship, and one that is well placed to take these assets to the next stage of their development,” Shell Canada President Michael Crothers said.


Dominion Energy Appeals to U.S. Supreme Court to Defend Atlantic Coast Pipeline

In December, the Fourth U.S. Circuit Court of Appeals dismissed a permit allowing the Atlantic Coast natural gas pipeline to cross the Appalachian Trail in Virginia.

According to the court, the Forest Service does not have authority to give permission for pipeline construction on federal land, however Dominion Energy and the U.S. Department of Justice recently made an appeal to the Supreme Court to overturn this decision.

56 pipelines are already in place crossing through the Appalachian Trail, and if the Atlantic Coast pipeline is not allowed through, Dominion observes that it could make the Trail into a barrier between consumers in the east and resource-rich areas in the west.

Josh Price, senior analyst at Heigh Capital Markets, says, “We believe the [Supreme] Court may view this as an issue of national importance…if the court declines to take up the case or upholds the ruling, we anticipate [Atlantic Coast] owners may cancel the projects.”

Seeking Alpha

Michigan AG and Enbridge at Odds Over Oil Pipeline in Great Lakes

On Thursday, the attorney general of Michigan filed suit to shut down Enbridge’s 66-year-old twin pipelines in the Great Lakes. He said there is an “unacceptable risk” making it dangerous for the state to wait 5 to 10 years for replacements to get built.

Additionally, this past week, Democrat Dana Nessel dismissed the legality of a deal former Republican Gov. Rick Snyder and Enbridge had made allowing the company to continue adding a tunnel below their Line 5. Since the deal was made, Democratic Gov. Gretchen Whitmer and Enbridge have been in talks with Whitmer pushing for the project to be finished in 2 years, while Enbridge arguing they could not finish before 2024.

Nessel says she has “consistently stated that Enbridge’s pipelines in the Straits need to be shut down as soon as possible because they present an unacceptable risk to the Great Lakes…because of the very real risk of further anchor strikes, the inherent risks of pipeline operations and the foreseeable, catastrophic effects if an oil spill occurs at the Straits."

In opposition to their pipelines being shut down, Enbridge spokesman Ryan Duffy has stated their decommission would be a “serious disruption” to Michigan’s energy market and supply. Line 5 provides 55% of Michigan’s propane needs, as well as 65% for northern Michigan and the Upper Peninsula, and a large portion of aviation fuel at the Detroit Metro Airport.

Duffy adds that Enbridge “remains open to discussions with the governor,” and “is deeply committed to being part of Michigan’s future. We believe the Straits tunnel is the best way to protect the community and the Great Lakes while safely meeting Michigan’s energy needs.”

The pipes were put into operation in 1953 and, as Enbridge has said, are able to operate “indefinitely,” however opponents worry the construction on the tunnel encasing the Line 5 could prolong a possible unprotected accident or spill in the Straits area. Nessel’s suit addresses the anchor strike possibility and calls on an Ingham County judge to overrule the operation of the pipelines as they violate the public trust doctrine and the Michigan Environmental Protection Act as they have the plausibility of causing pollution and destroying natural resources.

Enbridge has brought to attention the safety actions they have put in place to prevent anchor strikes and has requested continued talks with Governor Whitmer with an independent moderator to assist in facilitating discussion as well as pausing their lawsuit filed against her.


Flint Hills May Sell Their Texas Crude Export Terminal

U.S. oil refiner, Flint Hills Resources, recently hired JP Morgan Chase to assist in marketing the assets of their crude export terminal in Ingleside, Texas. Flint Hills is considering finding a partner for the operation or simply selling it on its own. The terminal is a connecting point for several pipelines, including some owned by Phillips 66 and Plains All American Pipeline LP.

Andy Saenz stated, “we want to understand how the market values the asset and whether there is an opportunity to utilize the terminal better than we are today.”

Flint Hills has shared that they are growing storage capacity at Ingleside terminal by 1 million barrels to 3.5 million and have raised the site's vessel loading capacity from 200,000 barrels per day to 380,000 barrels per day.


Enbridge Supported by Wisconsin Supreme Court in Dane County Case

A ruling from the Wisconsin Supreme Court has allowed Enbridge Energy to continue on with their pipeline project in Dane County without any additional insurance, despite the local government putting a requirement on Enbridge’s permit for a $25 million environmental liability policy.

Wisconsin lawmakers stepped in and passed a provision blocking local municipalities from putting liability requirements on an operator if they already had sufficient insurance. After a couple back and forths of courts contesting Enbridge’s quality of insurance, the high court ruled that Enbridge does have comprehensive insurance. According to Enbridge, they have $860 million worth of general liability insurance, including coverage for ’sudden and accidental’ pollution.

Despite the ruling, several people within local government have been adamant that Enbridge has yet to provide proof of adequate insurance for ’sudden and accidental’ cases. Concerned about the decision, Patricia Hammel, a landowner’s attorney, stated that it “allows Enbridge to operate the largest tar sands pipeline in the U.S. across Wisconsin without adequate insurance and exposes our people, land and water to the consequences of a catastrophic spill.”

Enbridge’s oil spill in 2010, in southwest Michigan, polluted almost 40 miles of the Kalamazoo River and cost them $1.2. billion. In addition, the United States fined them for missing deadlines on pipeline inspections prior to the spill, costing them an extra $1.8 million. The cleanup lasted until 2014.

Meanwhile, Enbridge has finished their $1.5 billion pipeline make-over and built the Waterloo pump station, which, according to a spokeswoman of Enbridge, Jennifer Smith, is necessary in order to “ensure a reliable source of energy for decades to come.”


Archrock Gains Elite Compression for $410 Million

Elite Compression Services will be passing down a handful of assets to Houston-based Archrock, an energy infrastructure company, after closing a $410 million cash and stock deal. Archrock’s current 3.5 million-horsepower operations should increase by 430,000 large-horsepower compression assets.

Regarding these assets, Archrock President & CEO, Brad Childers, says “more than 80%…are contracted for more than three years with blue-chip customers. In addition, this transaction adds basin density in our core areas, with more than 70% of the units deployed in the Eagle Ford and South Texas region, and the concurrent sale of non-core equipment further standardizes our asset portfolio.”

Archrock is also planning on selling $30 million of 80,000 horsepower of non-core compression assets to JDH Capital portfolio company Harvest Midstream in order to help their operations by increasing standardization.


Kinder Morgan Approved by Court to Continue with $2 Billion Pipeline Project

On Tuesday, a Texas judge ruled that Kinder Morgan Inc. does not need approval from the Texas energy regulator in order to start working on a $2 billion natural gas pipeline project. Based on the new ruling, land can be taken and utilized by pipeline operators, if they qualify as utilities, for the public good without landowner’s consent. Standards for routing pipeline projects or private land-takings are no longer required by the Texas Railroad Commission (TRC).

Prior to the ruling, a lawsuit was made by some Texas landowners and officials who argued the TRC was not properly supervising or seeking public approval for Kinder Morgan’s Permian Highway pipeline. Kinder Morgan’s counterargument was that the decision was in the state legislature’s hands when it came to changes in the pipeline permitting process.

Tom Martin, a Kinder Morgan Executive, stated after the ruling that, “the court’s finding validates the process established in Texas for the development of natural gas utility projects.”

The pipeline is set to be about 400 miles long, stretching from West Texas to the United States Gulf Coast and carrying 2 billion cubit feet every day of natural gas. Landowners worry that “sensitive environmental features,” along the lines of endangered species habitats, residential neighborhoods and historic sites, will be affected. An advocate for Texas landowner’s rights, the Texas Real Estate Advocacy and Defense Coalition, is considering further legal actions.