Pipeline to connect Canadian Oil Sands to Houston

CALGARY — Canadian oil sands production — as much as 400,000 barrels a day — could be flowing into Texas by late 2010, dramatically shifting the market for domestic crude output as new projects begin pumping north of Fort McMurray.

Enbridge Inc. announced a preliminary partnership with giant Exxon Mobil Corp. yesterday to create by far the biggest link yet with Texas, connecting Illinois with Enbridge’s sprawling pipeline network that originates in Alberta, and further marginalizing a plan to ship oil to refineries in China.


While a significant amount will be processed in Alberta, producers and pipeline companies foresee a surplus of raw bitumen.

The Houston region and the Gulf Coast are home to about half the refining capacity in the United States, including two facilities owned by Exxon, one of which is the biggest in North America, handling more than 500,000 barrels a day. Current supply for the region’s refineries comes from Texas and the Gulf, as well as from Mexico and Venezuela — which are the two competitors Canadian producers are trying to partly displace.

Globe and Mail