Enbridge Starts Construction of Valley Crossing NatGas Pipeline at Tex-Mex Border

Enbridge has started construction of the offshore border crossing section of its $1.6 billion Valley Crossing natural gas pipeline between Texas and Mexico, according to a U.S. federal filing.

The construction involves a 1000-foot section of offshore pipe that extends to the U.S.-Mexico border. The onshore sections of the pipeline have been completed.

The Valley Crossing pipeline is designed to carry up to 2.6 million cubic feet per day of gas from Texas to help Mexico meet its growing power demands.

The pipeline will connect in the Gulf of Mexico to the Sur de Texas-Tuxpan pipeline that is currently under construction. When complete, it will be the biggest gas pipeline between the two countries.

Enbridge said the pipeline remains on track to enter service in October.


Buckeye Partners Seeking to Change Pipeline Direction After First Attempt Failed

Texas-based Buckeye Partners made plans to change the direction of its gasoline pipelines in late April, but it has been been met with resistance from companies Sheetz, Giant-Eagle, and Philadelphia-area refiners.

Buckeye Partners wanted permission from federal energy regulators to specifically move gas in two directions on the Laurel Pipeline across Pennsylvania. Buckeye wanted to reverse the western segment of the pipeline since 2016. In doing so, they intend to bring low-cost Midwestern fuel to more Pennsylvania areas.

Critics disagree and claim that gas prices would rise due to these changes.

A judge with the Pennsylvania PUC sided with the pipeline’s opposition and recommended that the reversal be rejected by the commission.

After a few weeks, Buckeye decided to take the case to FERC to approve moving fuel in both directions.

A final decision has yet to be made on the reversal and is not expected until late summer. 

Central Penn Business Journal

Colonial Pipeline to Pay $3.3 Million in Fines, Damages to Alabama for 2016 Pipeline Spills

Colonial Pipeline Co will pay the state of Alabama $3.3 million in damages and penalties related to an explosion and spill on its 5,500-mile gasoline line in 2016.

The state's attorney general said the settlement is to first address environmental damage to land and water that was caused by the combined 11,800-barrel spill that happened in rural Shelby County in late 2016.

In September of 2016, nearly 7,400 barrels leaked below ground and was discovered by a mining inspector. The leak was caused by pipe fatigue due to improper soil compaction.

In October, a pipeline explosion killed one worker and injured several others after the pipeline exploded during maintenance on the line when it was accidentally struck by excavating equipment. About 4,400 barrels spilled as a result of the explosion.

The Colonial Pipeline transports more than 3 million barrels per day of gasoline, diesel, and jet fuel from the Gulf Coast to New York.


SoCalGas Pulls NatGas from Aliso Canyon to Meet Demand During Cold Months

SoCalGas withdrew natural gas this past week from the Aliso Canyon storage facility in Los Angeles for the first time since July to meet customer demand for the unseasonably cold weather.

California regulators in July let SoCalGas resume injecting fuel into the facility after it was shut down due to a massive gas leak from October 2015 to February 2016.

After the leak, the facility was upgraded to meet stricter safety requirements, but California still limited the amount of fuel that SoCalGas could store and pull from the facility in order to protect public safety.

A spokesperson for the company said additional withdrawals from Aliso Canyon may be necessary in the coming days in order to keep up with customer demand and prevent any service interruptions during the cold weather, which is currently at about 10 degrees Fahrenheit below the average in Southern California.

Many groups want Aliso Canyon shut down after the leak that released more than 5 billion cubic feet of natural gas and caused the relocation of more than 2,000 families outside of the area. But SoCalGas says the facility is needed to keep the gas system reliable.


Low U.S. Gas Stockpiles, Pipeline Delays Cause Challenge for Fuel Exports to Mexico

Low natural gas inventories in the U.S. and delays in pipeline infrastructure may slow exports this year to Mexico, which is dependent on U.S. fuel, according to analysts.

Cold temperatures pushed U.S. gas stockpiles far below the five-year average in early January, from 2.471 trillion cubic feet to 2.078 trillion cubic feet, the lowest it has been since 2014.

Analysts say operators will find it difficult to completely replenish U.S. gas inventories during the 2018 gas injection season, which will impact exports from the country.

When inventory levels are weak, operators normally put more gas into rebuilding storage than exporting it, which hampers shipments to Mexico.

Delays in the Nueva Era pipeline, which is designed to move gas from the U.S. into Mexico, is also causing challenges for Mexico to increase U.S. gas pipeline imports.

The pipeline, a joint venture between Howard Energy Partners and Grupo Clisa, was originally supposed to come online in June 2017 but has been delayed until the third quarter of 2018.


Report: Canada's Pipeline Bottleneck Causes Struggle to Stay Competitive

Pipeline projects in Canada are failing to materialize due to strong environmental opposition, causing the country to lose competitiveness as an oil and gas producer, according to a report by the C.D. Howe Institute.

In addition, fuel costs are rising in Canada as a result of the widening gap between supply and demand for pipeline capacity linking Canada and the U.S.

If Canada produced pipelines more expeditiously, its competitiveness would improve greatly, according to the report. Currently, pipeline capacity shortages in Canada are cutting profits by around $5 a barrel.

The report comes just days before Canada said it is planning to create a new system to approve major energy infrastructure projects.

Canada Prime Minister Justin Trudeau said Thursday in a radio interview that the federal government ensures that Kinder Morgan's Trans Mountain oil pipeline expansion will be built as the country is in desperate need to move oil to market.

Oil Price

Magellan Midstream Fuel Pipeline Leaks 500 Barrels of Gasoline in Minnesota

Magellan Midstream Partners on Monday said it estimates a total of 500 barrels of gasoline leaked from its 12-inch pipeline system in Eagan, Minnesota.

The leak was caused by third-party excavation equipment, according to Magellan Midstream.

Several roads near the area were temporarily closed down, and some businesses in the immediate area were evacuated.

Emergency responders and regulators are on site, but Magellan said it does not yet have a definitive timeline for repairs to be complete.


Colonial Pipeline, Enterprise Products Partners Teaming Up for Fuel Exports from Beaumont Terminal

Colonial Pipeline and Enterprise Products Partners are teaming up to boost exports from the Beaumont refined oil products terminal in Texas to rival the Houston Ship Channel.

Colonial Pipeline is offering marine logistic services and access to as much as 2 million barrels of new storage at Enterprise's facility in Beaumont. Colonial's shippers will be able to move fuel from 13 Gulf Coast refineries to the Beaumont terminal.

The Colonial Pipeline transports more than 3 million barrels per day of gasoline, diesel, and other fuel from the Gulf Coast to the northeast, making it the largest refined products system in the U.S.

International demand for refined products has been on the rise, causing U.S. exports to surge.


Explorer Pipeline Starts Two Fuel Pipelines This Week; Colonial Pipeline Restarts Lines After Storm

Explorer Pipeline's 28-inch fuel pipeline and 24-inch fuel pipeline that run from Texas to Oklahoma and Oklahoma to the Midwest respectively, began operations as scheduled early this week, easing concerns over a fuel supply crunch.

The 28-inch fuel pipeline began Sunday, and the 24-inch fuel pipeline began Monday, according to a statement.

The startups are easing concerns over a fuel supply crunch after Tropical Storm Harvey shutdown nearly a quarter of the U.S. refinery capacity and sent gasoline futures prices to a two-year high.

Explorer Pipeline is owned by Phillips 66, Marathon, Sunoco Logistics, and Shell.

Colonial Pipeline also announced Monday that it restarted one of its major fuel lines that was shut during the Harvey storms and will restart another line on Tuesday.

Colonial is the biggest U.S. fuel system, connecting Texas refineries with markets in the Northeast and transporting more than 3 million barrels a day of gasoline.


Texas Refineries Begin to Restart After Major Shutdown Due to Storm Harvey

Gasoline prices are slowly falling and oil prices are rising as of Tuesday after refineries in the Gulf Coast slowly begin to restart after nearly a quarter of the U.S. refining capacity was shut down last week during Hurricane Harvey.

Harvey blasted the Gulf Coast and other areas of southeastern Texas, including the city of Houston, on August 25 and hovered over the area for nearly a week, dropping trillions of gallons of water onto the state.

As of Monday afternoon, eight U.S. oil refineries with 2.1 million barrels per day of refining capacity were still shut, according to the Department of Energy.

Texas is slowly beginning its recovery as oil pipelines and refineries begin to start operations again, raising the demand for crude and easing fears of a fuel supply shortage.


Colonial Pipeline to Shutdown Key Fuel Pipeline Due to Harvey Floods

Colonial Pipeline announced it will shut down a key gasoline line that supplies the South due to Tropical Storm Harvey-related refinery shutdowns in Houston and the storm’s effect on Colonial’s facilities in Lake Charles, Louisiana.

The line, which provides nearly 40 percent of the South’s gasoline, will be shut down Thursday, according to the company.

Colonial Pipeline already shut down its other mainline that transports diesel and aviation fuels.

Colonial’s shutdown will surely raise gasoline prices as it did when the line was shut down in September, 2016 due to a leak and gas spill. But prices have been on the rise ever since storm Harvey dumped more than four feet of rain on southeastern Texas over the last week.

Harvey caused shutdown of over 20 percent of the Gulf Coast’s oil refining capacity due to floods.

At least eight refineries in the area were also shut down, according to AAA.

Colonial Pipeline said its system would resume operations once the company can ensure that its facilities are safe and able to move product.

The Colonial Pipeline runs from Houston to New York and makes up more than 5,500 miles of pipeline.


Colonial Pipeline Company Fills Largest U.S. Gasoline Pipeline As Demand in Northeast Recovers

Colonial Pipeline is back to rationing space on its gasoline pipeline, the largest gasoline pipeline in the U.S., as demand moves more fuel to the East Coast and prices grow stronger.

Colonial Pipeline's Line 1 ran below capacity for about 45 days starting in July but has now restarted its practice of rationing space and froze shippers' ability to nominate more fuels this month in order to maintain the line's five-day cycle shipping frequency.

Demand to ship fuel on the line had fallen below capacity for the first time in six years last June as traders and refiners increased exports instead of shipping to the northeast where stockpiles were bloated.

The summer season has driven up demand, resulting in inventories to fall more in line with the five-year average in recent weeks.

The gasoline pipeline carries approximately 1.3 billion barrels a day from a refining hub near Houston to northern, high-demand locations like New York City.