• 2 days PDVSA Booted From Caribbean Terminal Over Unpaid Bills
  • 2 days Russia Warns Ukraine Against Recovering Oil Off The Coast Of Crimea
  • 2 days Syrian Rebels Relinquish Control Of Major Gas Field
  • 2 days Schlumberger Warns Of Moderating Investment In North America
  • 2 days Oil Prices Set For Weekly Loss As Profit Taking Trumps Mideast Tensions
  • 2 days Energy Regulators Look To Guard Grid From Cyberattacks
  • 2 days Mexico Says OPEC Has Not Approached It For Deal Extension
  • 2 days New Video Game Targets Oil Infrastructure
  • 2 days Shell Restarts Bonny Light Exports
  • 2 days Russia’s Rosneft To Take Majority In Kurdish Oil Pipeline
  • 3 days Iraq Struggles To Replace Damaged Kirkuk Equipment As Output Falls
  • 3 days British Utility Companies Brace For Major Reforms
  • 3 days Montenegro A ‘Sweet Spot’ Of Untapped Oil, Gas In The Adriatic
  • 3 days Rosneft CEO: Rising U.S. Shale A Downside Risk To Oil Prices
  • 3 days Brazil Could Invite More Bids For Unsold Pre-Salt Oil Blocks
  • 3 days OPEC/Non-OPEC Seek Consensus On Deal Before Nov Summit
  • 3 days London Stock Exchange Boss Defends Push To Win Aramco IPO
  • 3 days Rosneft Signs $400M Deal With Kurdistan
  • 3 days Kinder Morgan Warns About Trans Mountain Delays
  • 4 days India, China, U.S., Complain Of Venezuelan Crude Oil Quality Issues
  • 4 days Kurdish Kirkuk-Ceyhan Crude Oil Flows Plunge To 225,000 Bpd
  • 4 days Russia, Saudis Team Up To Boost Fracking Tech
  • 4 days Conflicting News Spurs Doubt On Aramco IPO
  • 4 days Exxon Starts Production At New Refinery In Texas
  • 4 days Iraq Asks BP To Redevelop Kirkuk Oil Fields
  • 5 days Oil Prices Rise After U.S. API Reports Strong Crude Inventory Draw
  • 5 days Oil Gains Spur Growth In Canada’s Oil Cities
  • 5 days China To Take 5% Of Rosneft’s Output In New Deal
  • 5 days UAE Oil Giant Seeks Partnership For Possible IPO
  • 5 days Planting Trees Could Cut Emissions As Much As Quitting Oil
  • 5 days VW Fails To Secure Critical Commodity For EVs
  • 5 days Enbridge Pipeline Expansion Finally Approved
  • 5 days Iraqi Forces Seize Control Of North Oil Co Fields In Kirkuk
  • 5 days OPEC Oil Deal Compliance Falls To 86%
  • 6 days U.S. Oil Production To Increase in November As Rig Count Falls
  • 6 days Gazprom Neft Unhappy With OPEC-Russia Production Cut Deal
  • 6 days Disputed Venezuelan Vote Could Lead To More Sanctions, Clashes
  • 6 days EU Urges U.S. Congress To Protect Iran Nuclear Deal
  • 6 days Oil Rig Explosion In Louisiana Leaves 7 Injured, 1 Still Missing
  • 6 days Aramco Says No Plans To Shelve IPO
China Drives Natural Gas Demand Boom

China Drives Natural Gas Demand Boom

China is poised to surpass…

2 Red Flags For The World’s Top Shale Play

2 Red Flags For The World’s Top Shale Play

Changing legislation and taxation for…

Natural Gas Pipelines are Being Converted to Carry Crude Oil

Natural Gas Pipelines are Being Converted to Carry Crude Oil

The abundant supply of natural gas from just a few shale fields has changed the natural gas landscape in the US, meaning that a lot of the traditional natural gas pipelines, which don’t run near the new fields, are no longer needed, or a running at far lower capacity as demand for their use has dropped.

Fortuitously, the decline in demand for supplying natural gas along these routes has coincided with an increased demand for transporting crude oil. Putting two and two together, the pipeline companies are looking to convert their natural gas pipelines into oil carriers.

Another benefit of converting existing gas pipelines to transport is the avoidance of drawn out legal and bureaucratic battles to achieve permission to build new pipelines. Ken Beckman, and energy analyst at International Gas Consulting, said that “the Keystone Pipeline approval has been so painful that the ability to convert something in the ground that already has right-of-way approvals is exceedingly appealing.”

Related Article: TransCanada Awarded Contract to Build $1 Billion Natural Gas Pipeline in Mexico

TransCanada has announced that it will make a decision early next year as to whether it will convert part of its natural gas mainline to deliver light sweet crude from North Dakota to refineries in East Canada and the US. The pipeline is no longer in demand as production from the Marcellus and Bakken plays continues to increase, reducing the demand for gas from Alberta.

Crude oil production from the Bakken in North Dakota has reached record levels and looks set to continue growing. Kinder Morgan are thinking of converting the Pony Express Pipeline from natural gas to crude, with deliveries predicted to start around the end of 2014.

By. Joao Peixe of Oilprice.com



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News