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CAPP touts more pipelines, fossil production despite prospects for falling demand

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“CAPP’s analysis always points to the dire need for new pipeline capacity, regardless of what’s happened with new pipeline development and tar sands/oil sands cancellations.”

The Energy Mix by

While forecasts pile up predicting a drop-off in demand for fossil transportation and heating fuels, Canada’s oil and gas producers see nothing but open throttles ahead for crude extracted from high-carbon bitumen and delivered to world markets by more pipelines.

In its 2017 Crude Oil Forecast, Markets and Transportation report, the Canadian Association of Petroleum Producers (CAPP) predicts that “Canada will need more pipelines built through to 2030 to transport an additional 1.3 million barrels per day of oilsands production to markets across North America and around the world,” according to industry monitor JWN Energy.

Existing lines, with a capacity of four million barrels per day, handle Canada’s existing petroleum production of 3.85 million barrels with room to spare. But with the expansion in output it envisions, the fossil lobby group forecasts that pipelines “will need to move more than 5.5 million barrels per day” by 2030. That growth “will exceed existing pipeline transportation capacity,” JWN writes, “highlighting the urgent need for pipelines heading east, west, and south.”

“Increased pipeline capacity to reach more Canadians and new, growing markets around the world will ensure Canada remains globally competitive,” CAPP asserts. But its expectations may be built on (tar-free) sand. A growing number of mainstream media outlets are reporting that oil’s day is done, and that the sun may go down much sooner than oil’s producers might like to believe.

“This is What the Demise of Oil Looks Like,” Bloomberg headlined a collection of forecasts showing how the influence of increasing energy efficiency, technology change, electric vehicles, and fuel-switching to renewable energy at plummeting prices will erode the International Energy Agency’s forecast that oil demand will rise more than 10% by 2040. CAPP, for its part, assumes that demand for some of the world’s most expensive—as well as highest-carbon—oil will grow by more than 34% a decade earlier.

Last year, an independent analysis based on CAPP’s own data from its 2015 Crude Oil Forecast demonstrated that Canada does not, in fact, need any new pipeline capacity.

Oil Change International was downright sanguine in its on-the-spot analysis of the CAPP release. “This ritual happens every June, and presumably CAPP hopes no one will actually compare the consistency of what it says each year,” writes Senior Campaign Adviser Greg Muttitt.

But after doing precisely that analysis, Oil Changes comes back with two observations: CAPP’s analysis always points to the dire need for new pipeline capacity, regardless of what’s happened with new pipeline development and tar sands/oil sands cancellations. And this year, a close look shows shifting numbers and assumptions that call the whole release into question.

“In reality, there’s enough pipeline space for all the [new production] projects that are currently being built; you only need new pipelines if you’re planning a massive expansion, and ignoring the Paris Agreement,” Muttitt concludes. “We’ve now closely followed six iterations of the CAPP graph of pipelines. And it’s fair to say they’ve got progressively more far-fetched over the years. But that’s what alternative facts are all about.”

See article here……


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