Pipeline flow direction in Canada to accomodate tar sands output growth

A article in the Economist (May 26, 2012) describes the increased oil production from the tar sands in Alberta, Canada, estimated to gow to 72 % of Canada’s output by 2020 (from 58 % now). But getting that oil, which can emit three to four times the greenhouse gases as regular oil, to market, has been a challenge. The holdup of oil pipelines from Canda through the US has now required potentially reversing the flow of a pipleine in Ontario – increase its utilization – which has dropped to 50%. Canadian gas exports have decreased as US exploration of shale gas has increased. Should the Canadian government focus on getting the gas to Canada’s eastern regions, that currently use more expensive imported oil ? Or should they focus on getting the tar sands oil to China via ports in British Colombia, albeit with a riskier long pipeline through native lands ? Should the nature of the oil flowing on existing pipelines, and the direction of flow, be subject to regulation ? Is the focus on blocking pipelines as a means to reduce exploration of tar sands, an acceptable approach for environmentalists ?

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About aviyer2010

Professor
This entry was posted in Global Contexts, Operations Management, Supply Chain Issues, Sustainability and tagged , , , , , , , , , , . Bookmark the permalink.

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