Canada Could Fill Two Pipelines

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Canada Could Fill Two Pipelines By Nick Hodge | Tuesday, January 31st, 2012 We're all aware of the Keystone Pipeline. It's the $7 billion project that would send a much-needed 1.1 million barrels of crude oil per day from Canada's oil sands to the American Heartland. But you're probably a bit fuzzy on what its status is. Because of fiery political rhetoric and backroom maneuvers, it can be tough to figure out where the project stands. I offered my no-spin take a few weeks ago, when the headline was that Obama “killed” the Pipeline, concluding: This man has an election to win over the next ten months. He can't kill a pipeline that would create thousands of jobs, break a supply logjam in Oklahoma, and carry between 500,000 and 1 million barrels of secure Canadian oil to the States every single day. It will happen... eventually. Advertisement "Secret $200 Retirement Blueprint" Exposed If you've already retired, or want to retire soon, I urge you to watch this video presentation before we have to pull it down. This "Secret $200 Retirement Blueprint" shows you step-by-step how to grow a monster-sized nest egg with a little time and a tiny grubstake. Click here to watch this video presentation now.  A Tale of Two Pipelines In addition to the Keystone XL, Canada also has plans to build the $5.5 billion Northern Gateway Pipeline, which would send oil to a British Columbia port for export to Asia (China). That pipeline has a capacity of 525,000 barrels per day. Combined with the Keystone, the two pipelines would send 1.625 million barrels per day out of Canada. To be clear, the Canadian government wants to build both pipelines. With reserves second only to Saudi Arabia and Venezuela, it would be an economic boon to the Great White North. And Prime Minister Stephen Harper has shown he's willing to play politics to make it happen. After Obama's decision two weeks ago to postpone the Keystone, Harper publicly said he was “profoundly disappointed,” and spoke of the need to “diversify” Canada's oil industry. That's code for “sell it to China.” The thing is, Enbridge's (NYSE: ENB) Northern Gateway is facing the same environmental pressures as TransCanada's (NYSE: TRP) Keystone. Currently, the former project's Joint Review Panel is canvassing public sentiment along the pipeline's 731-mile proposed route. Already, more than 4,000 people have signed up to testify, and I'm assuming not about how much they want a pipeline in their backyard. What's more, together the pipelines could move 1.625 million barrels per day. For the most recent month that data is available — October 2011 — Canada exported 47.03 million barrels, or 1.52 million barrels per day. And data from the Canadian Association of Petroleum Producers shows total production will hit 3.5 million barrels per day in 2015, 4.2 million in 2020, and 4.7 million in 2025. So throw the politics out the window. Canada has enough to fill both pipelines. Harper just wants to have his cake and eat it, too. And I don't blame him. Advertisement The Bakken Bank Account These days, oil in the ground is like money in the bank. And with tens of billions of barrels, the Bakken is the best bank there is. You can pen your "Bakken Bank Account" today for as little as $6.00. Click here to get started.  A North American Comeback The real story here is being buried by political spin... It isn't about whether the United States or China gets Canadian oil. It isn't about environmentalism. It isn't about Obama. The real story here is a veritable North American oil rush. We're just fighting over where it will go and who will make the most money. As I told you in my last update on this pipeline situation, oil is a global market. A fight over where a pipeline should reside doesn't change the amount of the stuff in the ground. Sure, the political angle will play a supporting role in this year's U.S. election. And yes, the environmental crowd may get a “victory” by tying both pipelines up in court for a few years. But at the end of the day, I believe both pipelines will be built. The oil sands in Canada and the shale in the U.S. will both be fully developed. To think otherwise in naïve. And to get caught up in the trivialities of politics and environmentalism surrounding this development is to seriously take your eye off the ball. There's a reason China invested $16 billion in Canadian energy in the past two years and $6 billion in the U.S. in just the past few weeks... A major oil production boom is underway. And the way to make money from it is by investing in the drillers with access to the best sites — not by getting wrapped up in the daily tit for tat. Call it like you see it, Nick Hodge @nickchodge on Twitter Nick is an editor of Energy & Capital and the Investment Director of the thousands-strong stock advisory, Alternative Energy Speculator. Co-author of the best-selling book Investing in Renewable Energy: Making Money on Green Chip Stocks, his insights have been shared on news programs and in magazines and newspapers around the world. For more on Nick, take a look at his editor's page.   Related Articles Pipeline Straight Talk Politics Killed the Pipeline, Not the Profits TransCanada Looks for Options After Pipeline Rejection Investing in Oil and Gas Infrastructure From the Archives... 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