This is “The End” for any hope of gasoline prices on the West Coast, specifically Southern California, before Memorial Day. Today’s AAA Fuel Gauge for Los Angeles-Long Beach showed the average gasoline price already over $4 per gallon. The two major oil company refinery upsets in Southern California this afternoon will result in spike for gasoline prices starting on Monday with retail pump prices expected to hit $4.25 per gallon. The remainder of the West Coast including the Bay Area and the Pacific Northwest gasoline prices will follow suit.
Los Angeles-Long Beach
The CononoPhillips 76 refinery in Wilmington reported flaring this afternoon. Then the kicker came in the form of the ExxonMobiil refinery suffering a “power bump” putting their Fluid Catalytic Cracker (FCC) unit out of business.
Because of it the ExxonMobill was flaring Friday afternoon at its 149,000 b/d refinery in Torrance, Calif., with the shut down of their FCC unit, which had been kept running while other units in the refinery were going through a planned turnaround. Now all of the units at this refinery are down.
The FCC is out of service and the refinery is flaring,
The refinery issued an unplanned flaring notification to the South Coast Air Quality Management this afternoon citing a breakdown. The flaring event began at 2 p.m. PDT and is expected to end before midnight.
ExxonMobil began a large-scale, multi-week turnaround May 3 on Torrance’s lone crude unit, an alkylation unit, a delayed coker unit, a sulfur recovery unit and a hydrotreater.
“Although we anticipate impact to production, ExxonMobil expects to be able to meet its contractual commitments,” a company spokesperson previously said about the planned maintenance.
The fluid catalytic cracker was not involved in the turnaround and had been operating via gasoil feed stored in railcars before a power glitch affected the unit.
Late Friday afternoon David Dumais, deputy fire chief of Torrance Fire Department, confirmed the following by phone.
* Upset occurred during maintenance turnaround,
* Refinery started turnaround this month on units including crude unit, alkylation unit, coker, hydrogen plant on May 2, 2013.
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Bob van der Valk | Managing Editor, Bakken Oil Business Journal
Terry, Montana | (406) 853-4251 | firstname.lastname@example.org
There is no such thing in the petroleum business as perfect timing but in this case the Keystone XL pipeline project may just be the ticket to put North America over the threshold of becoming energy secure from Middle East countries from which we have been importing crude oils for over 40 years. The Organization of the Petroleum Exporting Countries (OPEC) is a cartel given a free hand to rule over the oil dependent economies of Western Countries like the US by dictating our fuel prices for over 40 years.
With excuses to “The Association” for using a parody of their song to make my point:
And then along comes Keystone
And does she want to give me kicks , and be my steady stream
And give me pick of memories
Or maybe rather gather tales of all the fails and tribulations
No one ever sees
Tanker rail cars filled with crude oils are already heading south from Saskatchewan, Canada and Trenton, North Dakota. The bitumen oil sands and Bakken crude oils could be more easily transported and economically by the use of a pipeline. It’s been a long four years with many fails and tribulations along the way to obtain the necessary permit to construct and operate just the animal known as the Keystone XL pipeline.
After completion it will be able to carry 830,000 barrels of crude oil to Cushing, Oklahoma on its way by use of the southern leg already under construction going to the Gulf Coast refineries. An on-ramp called The Bakken MarketLink will intersect with the Keystone XL pipeline in Baker, Montana, providing much needed relief for export of oil being produced from the Bakken formation. Much of this oil is currently exported with a discount to producers due to the lack of infrastructure necessary to move their product. Additionally, the pipeline will provide the safest method of transport, where currently much of the oil is being transported by tanker or railcar.
Much of the workforce necessary to build the new pipeline will be housed in a proposed workforce camp adjacent to the City of Baker. The camp will be built when the Presidential Permit (necessary to cross the Canadian border) has been approved. In preparation for the camp, the City of Baker has been working with Keystone to assure the necessary water and wastewater infrastructure is in place. Current electrical work being performed in Baker, Montana is for a wastewater lift station. Any improvements that are needed for the camp once it is constructed will be ultimately reimbursed by Keystone to the City.
Ongoing electrical infrastructure work at the proposed Baker, Montana workforce camp site.
Senator Alan Simpson gave the keynote address on February 20, 2013 at the Western Petroleum Marketers Association Convention and Trade show in Las Vegas. The former Senator from Wyoming recently became better known for the Bowles – Simpson Plan to reduce to national debt.
In response to my question about the future of the Keystone XL pipeline, he revealed Richard Trumka, the current President of the AFL-CIO, would come out in favor of President Obama granting the permit for construction and operation of the Keystone XL pipeline about a month from then.
Senator Alan Simpson took time to pose with me before giving the keynote address
Right on schedule on March 21, 2013 Joe Canason, a reporter for Real Clear Politics web site, interviewed Trumka. He told him that he doesn’t oppose the Keystone XL crude oil pipeline, current bête noire of the environmental movement. Although the AFL-CIO hasn’t directly backed Keystone, it has endorsed “pipelines in general,” said Trumka, who argues that the pipeline will have “a smaller carbon footprint” than other methods of transporting those petroleum products.
The nation would be better served, he says, by reducing “seeps and leaks” from existing oil facilities, “which represent a bigger hazard to the environment.” Would that create jobs? Trumka responded: “Far more than the pipeline itself — about 125,000 jobs a year. But it would also be a win-win. The environmentalists agree with us on that, we should clean up the leaks and the seeps.”
Read more at: http://www.realclearpolitics.com/articles/2013/03/21/the_newsmaker_memo_an_interview_with_afl-cio_president_richard_trumka_117562.html#ixzz2SL7CzAjJ
From 2005 to 2012, East Coast refinery runs of imported crude decreased 735,000 barrels per day (bbl/d) or 46 percent. (Editor’s note: There are 42 gallons in one barrel of crude oil.) That decrease was almost matched by a 685,000 bbl/d decrease in overall East Coast crude runs. Recently, the large price differentials between land-locked crude oils with growing production, such as the Bakken, and global sea-borne crude oils linked to the price of the Intercontinental Exchange of London Brent crude oil benchmark price, have encouraged refiners to bring more domestically produced crude into the region via rail. In 2012, 92 percent of crude oil run in East Coast refineries was imported, down from 99 percent in 2005.
Opposite this trend, the Midwest has been importing significantly more crude oil from Canada since 2005. In 2012, runs of imported crude oil reached 1.7 million bbl/d, an increase of 205,000 bbl/d (14 percent). In 2005, almost 34 percent of imported crude oil run in the Midwest was shipped to the Midwest via another region, most commonly by pipeline from the Gulf Coast; however, by 2012, nearly all imported crude processed in the Midwest was imported directly from Canada. While total U.S. crude imports have been decreasing, imports from Canada have gone up 775,000 bbl/d since 2005. The United States imported 2.4 million bbl/d of Canadian crude oil in 2012, or about 28 percent of the total U.S. crude imports.
The AFL-CIO endorsement, for the Keystone XL pipeline permit to be recommended by the US State Department for final approval by President Obama, is a step in the right direction. Another little push and North America will be energy secure and stick our thumbs on our noses to those pesky OPEC members.
ABOUT THE AUTHOR – Bob van der Valk, petroleum industry analyst, is the managing editor and regular contributor of the Bakken Oil Business Journal. He works and lives in Terry, MT. He can be contacted at (406) 853-4251 or by email.
Photo by Renae Mitchell, Oil & Gas Industry Photographer
Nicknamed the Mile High City because of its elevation, Denver was established in 1858 just east of the Rocky Mountains as a mining town during the Pikes Peak Gold Rush. Originally known as Denver City, the city was named after Kansas Territorial Governor James W. Denver. At the time, the area was part of Kansas Territory. Later, Denver City’s name was shortened to Denver after it became the capit al of the Colorado territory, which was created in 1861. Completion of the Denver Pacific Railroad in 1870 that linked Denver to the transcontinental railroad enabled Denver to prosper as a supply and service hub.
While gold mining brought the first settlers to Denver, companies that are part of the air transportation, telecommunications, aerospace, and manufacturing industries are also found in Denver today. A number of oil and gas companies are also present in Denver, including Halliburton, Noble Energy Inc., Anadarko Petroleum Corp., EnCana Corp., EOG Resources Inc., and GE Oil & Gas.
Innovation in multi-stage hydraulic fracturing and horizontal drilling technology has allowed the oil and gas industry to begin exploring Colorado’s unconventional resources. These resources include shale and tight sands within three basins. Of these plays, the Niobrara currently is the most active, according to a report by the Institute for 21st Century Energy. Some analysts have estimated the Niobrara, which is mainly a liquids-rich play, to hold reserves of approximately 2 billion barrels of recoverable oil reserves, according to the Colorado Oil & Gas Association.
Unconventional oil and gas activity in Colorado created 77,600 jobs in the state in 2012, according to the second part of a report by the Institute for 21st Century Energy into the impact of unconventional resources on the U.S. economy. The number of jobs in Colorado supported by shale activity will grow to 121,398 in 2020 and 175,363 in 2035. Unconventional oil and gas activity contributed value-added economic activity of more than $11 billion in Colorado last year; that contribution is estimated to grow to more than $26 billion by 2035.
The nine-county Metro Denver and northern Colorado region ranked fourth for fossil fuel energy employment and seventh among the nation’s 50 largest metros for clean technology development concentration in 2012, according to the Metro Denver Economic Development Corporation. The energy industry cluster employs more than 44,000 people in the area, and the state of Colorado ranked tenth in fossil fuel energy jobs. Energy research centers and universities such as the National Renewable Energy Laboratory and the Colorado School of Mines are also found in the Denver area.
The energy industry not only has impacted Denver’s economy in real life, but in prime time as well – the popular 1980s TV soap opera, “Dynasty” followed the lives of a wealthy oil family living in Denver.
Denver residents can enjoy an active lifestyle, thanks to the city’s proximity to the ski resorts and outdoor recreation opportunities in the Rocky Mountains, as well as the city’s golf courses, dog parks, swimming pools and tennis courts. Not surprisingly, Denver’s access to outdoor recreation opportunities means its residents are among the healthiest in the United States. In 2011, Forbes magazine ranked Denver fifth among America’s Top 20 Healthiest Cities. The city’s overall good weather, performing arts and cultural opportunities, panoramic view of the Rockies and excellent schools make Denver an ideal place to work.
Residents and visitors can glimpse the city’s past at historical sites such as the Molly Brown House – the home of the Unsinkable Molly Brown, an American socialite and philanthropist who survived the sinking of the Titanic – to Denver’s Four Mile Historic Park, which features the city’s oldest standing structure and exhibits of pioneer life in the West. Other landmarks and attractions include Colorado’s state capitol building, the U.S. Mint and Elitch Gardens, an amusement park located in downtown Denver. The city offers something for everyone, from art and science museums to performing arts and sporting events to its aquarium, zoo and botanical gardens.
Data released from the U.S Geological survey on Tuesday shows that 7.4 Billion barrels of oil could be recovered from the Bakken & Three Forks formations of North Dakota and Montana. This figure is more than double the previous estimate in 2008. Why such a large increase? The difference being the previous figure in 2008 was based purely upon the Bakken formation, the new figure comes as 2012 and the first quarter of 2013 have seen huge increases in drilling activity in the Three Forks. Undoubtedly, this new data only emphasizes how important optimizing completions is going to become to future Bakken & Three Forks development if operators are going to fully capitalize on North Dakota and Montana’s monumental shale reserves.
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KLJ, a multi-disciplinary engineering and planning firm, is proud to announce that the company has been recognized as one of the nation’s Top 500 Design Firms by Engineering News Record (ENR). “This is an outstanding achievement for KLJ and evidence that we are positioned well strategically and have a great team who will continue to lead us to future successes,” said Chief Executive Officer Niles Hushka.
The Top 500 Design Firms list, published annually in April, ranks the 500 largest U.S. based designs firms, both publicly and privately held, based on design-specific revenue. Companies engaged in general contracting specialty contracting, engineering, architecture, planning and studies are ranked through an annual survey. The rankings are then divided into specific market categories
KLJ was ranked 16th in the Nation for telecommunications, as the 76th largest designer in the United States and as the 110th largest firm in the United States. The rankings established KLJ as the highest ranked firm that originated in the region.
“The accomplishment is a great way to begin our 75 year anniversary. We have taken calculated risks which have proven to be successful and we will continue to be a leader in the industry” said Hushka.
Since 1938, KLJ has provided multi-disciplinary engineering-based solutions for national, large-scale operations, with the local expertise to drive projects forward and deliver successful results. As an employee-owned firm with a focus on innovation and hard work, we help clients succeed by developing lasting infrastructure that responds to the social, civic and economic needs of our communities. KLJ currently has 18 office locations throughout North Dakota, South Dakota, Minnesota, Montana and Wyoming. For more information about KLJ, visit www.kljeng.com.
BUTTE — In former Gov. Brian Schweitzer’s words, the Bakken oil formation in Eastern Montana and North Dakota is “a millionaire maker.’’
Schweitzer, speaking at a conference at Highlands College on Friday, focused his talk on the demand for solid Main Street businesses in that area.
The conference, called “Tapping Opportunity in the Bakken,” highlighted the status of the Bakken oil field and the challenges of doing business in the area. Schweitzer joined a host of speakers.
Schweitzer’s speech was full of his usual humor — “Why would you call something good a frack?” he asked, regarding the controversial method of extracting oil and gas that he supports.
A soil scientist, Schweitzer told the audience that one doesn’t have to be in the oil business to profit off of the boom in Eastern Montana. There are many other demands — with infrastructure like sewers and roads in need for repair, a desperate shortage of housing and visitors’ accommodations and the need for other basic necessities like transportation and food.
“If you know anything about anything … if you’re good at it, you’ll make money in the Bakken,” he said.
He pointed out that oil companies in the Bakken spend $750 million a year on sand alone for their fracking operations. At the selling rate of $80 to $160 a ton, people – Montanans –could make money simply by selling sand, he said.
He also said with issues over water rights, it’s “going to take a bunch of lawyers out there to get it sorted out.”
He said the Bakken is not going to be a boom-bust region, but will continue to thrive.
“Whatever you study, it doesn’t matter,” he said. “If you go to the Bakken, you’re going to hit home runs.”