Attacks On Oil Pipelines Are Serious to Global Economic Stability

The other day, I got on the topic of the importance of pipelines in any given civilization, here, 123sporters or anywhere else in the world for that matter. I mentioned to my acquaintance that it was too bad about the Canadian pipeline problem last week (First Week of May of 2011), and I asked him if he thought it was terrorism, or if he had heard any word from the industry on that. Let’s start from the beginning and really discuss the importance and challenges of pipeline infrastructure. wilmslowdecorators

You see, after that Canadian pipeline break, it looked as if the commodity oil traders attempted to take advantage of that crisis, at a time when oil prices were falling out from plus $100 per barrel – a rather steep drop, no not a free-fall, but it certainly sent anyone on margin out for a licking behind the woodshed. But that event stopped the commodity carnage, for a brief 1-2 day reprieve. sarah-j

Indeed, I had heard from sources that they immediately shut the pipeline down at both ends, and that 20,000 barrels spilled (turned out it was more like 28,000 barrels), that’s a nightmare to clean up, and the environmentalists are going to make noise over that one. Especially, considering that Shell Oil is about a stone’s throw from getting permits to drill off-shore in Alaska right now, with the Obama Administration intervening directly in the application and approval process. news today

My acquaintance who actually wrote a book about pipelines, specifically the attacks on pipelines in the Middle East, your bad guy’s basic economic warfare and terrorist move, told me that he’d also “heard about the pipeline break, and if that would have been huge news in Alaska, where I was but not much news since it was in Alberta,” and he also speculated that it might have been corrosion. “When oil comes out of the ground it contains hydro-sulfuric acid which corrodes everything. If it ever gets through the pipe membrane, it starts to corrode the metal, plus the cold and warm cycles from spring also cause breaks.” stylowakobieta

There was an interesting article recently about that Alberta oil pipeline break, you might look up the article online titled; “UPDATE 2-Alberta pipeline break an isolated incident-Plains” by Scott Haggett, published on May 6, 2011 which stated that “the break seen caused by poorly packed soil, not corrosion” – which is far more typical, even somewhat expected from time to time, but the article also states that the official released report says; The rest of the pipeline seen safe from rupture, and it is awaiting regulatory approval to restart pumping again. genee

Pipeline breaks shut down production flows and that has an adverse effect on prices, as the commodities market plays off the temporary chaos caused with supply. And when demand is high, and supplies somewhat tight, it’s a good excuse to bid the oil barrel prices up, and it doesn’t at that point really matter where in the world the pipeline breaks either. mba

Not long ago, I was talking with a another oil guy working in Nigeria, and he explained the thieves stealing oil from the pipelines are causing spills in the wetlands, mangrove forests in Southern Nigerian Delta an how sometimes they end up blowing themselves up in the process, which serves them right if you ask me – but that often can cause slight price spikes as well.

I’ve been following all the pipeline issues in the Global News, and it seems China is pretty worried about their recent pipeline investment through all the “stans” into their backdoor, terrorists are targeting those pipelines. In fact, China got together with all those other nations and started doing anti-terrorist exercises.

Of course, Iran’s crude pipeline into Turkey, and the natural gas lines from Egypt to Jordan and Syria were blown. And in Libya they are targets too. Hey it’s a chaotic world sometimes. Economic (and environmental) terrorism is real, and it is too bad we can’t also get the Iraqi oil flowing at the projected 12 billion barrels a year, 2.8 billion barrels just isn’t cutting it, but you know, more pipeline issues.

Oh and speaking of pipeline issues, and challenges there was an interesting piece not long ago in the Wall Street Journal titled; “California Weighs Plan to Test Old Natural Gas Pipelines” by Rebecca Smith on May 11, 2011 which discusses the California regulators response to the tragic explosion in a San Bruno, CA neighborhood in 2010. Apparently, some 700 miles of decade old natural gas lines need to be inspected for corrosion, etc.



Related Posts

Leave a Reply

Your email address will not be published. Required fields are marked *