Canada to become next OPEC

Canada to become next OPEC
Pipeline into U.S. gets regulatory approval

The United States' oil dependence on Canada, already America's largest supplier, is about to grow under a plan to build a new pipeline to transport oil from the tar sands of Alberta into the central part of the nation.

TransCanada Corporation, a public company traded on the New York Stock Exchange, has announced the TransCanada Keystone Pipeline has been given a final Environmental Impact Statement approval from the U.S. Department of State because of the limited adverse environmental impacts that are expected.

The approval is the result of nearly two years of analysis of the project proposal by more than a dozen U.S. federal agencies and other interested stakeholders.

Now that the EIS is finished, TransCanada expects to receive authorization soon to begin the construction and operation of the pipeline at the U.S./Canada border crossing.

The pipeline, planned for 2,148 miles, will bring oil from Hardisty, Alberta, Canada, to U.S. markets in Illinois and the Midwest, with an extension down to Cushing, Okla.

Just last week ConocoPhillips and TransCanada announced ConocoPhillips had acquired a 50 percent ownership interest in the Keystone Pipeline.

Hal Kvisle, TransCanada president, plans to begin construction on the pipeline in the second quarter 2008, with an in-service date set for the fourth quarter 2009.

In 2004, Canada replaced Saudi Arabia as the leading supplier of crude oil to the United States.

According to the Energy Information Administration, the leading suppliers of U.S. oil in Nov. 2007 were: Canada, 2.431 million barrels per day; Saudi Arabia, 1.620 million barrels per day; Mexico, 1.581 million barrels per day; Venezuela, 1.381 million barrels per day; and Nigeria, 1.306 million barrels per day.

According to Canada's Globe and Mail, by 2015 and the completion of the project, Canadian oil exports to the U.S. are expected to increase to three million barrels a day.

Plans also are under way to extend Canadian pipelines down to the Texas Gulf Coast where the Texas refineries used to processing the "heavy" and "sour" oil processed from Mexico and Venezuela are well suited to process the sticky crude produced from Alberta's oil sands.

Saudi Arabia, Venezuela and Nigeria are members of OPEC, the Organization of Oil Exporting Countries.