Environmental COncerns

Although California refineries initially met the criteria that spurred development of crude-by-rail (CBR) shipments to other coastal regions (lack of pipeline infrastructure and wide crude price differentials between stranded inland supplies and coastal alternatives) neither rail shipments or terminal build outs have made much of a dent in the Golden States’ crude supply. At their height in December 2013 CBR shipments into California reached 36 Mb/d – just 2% of the State’s 1.9 MMb/d refining capacity and they have since dwindled to a trickle. Today we examine the low pace of shipments.

Exporting large volumes of Western Canadian gas as liquefied natural gas (LNG) would help resolve the region’s growing gas glut. The government of British Columbia has set a goal of having three major LNG export facilities in operation by 2020, and already is counting the money it expects to make in LNG-related taxes. But while more than a dozen liquefaction/export projects are under development in BC, none of them is a sure thing yet, and LNG sales and purchase agreements with utilities and others in the Asia/Pacific region have been slow in coming. Today we begin a series that considers whether our northern neighbor’s chance to supply gas to Japan, China, and South Korea may be Slip Sliding Away.