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Wednesday, June 6, 2012

Boehner, Cantor Write to President Obama: Drop the Rally, Work Together on Student Loan Solution

Posted by Speaker Boehner Press Office
June 6, 2012
Press Release
WASHINGTON, DC – House Speaker John Boehner (R-OH) and House Majority Leader Eric Cantor (R-VA) today delivered a letter to President Obama encouraging him to work in a bipartisan manner to prevent student loan rates from doubling at the end of this month. With young Americans struggling to find work, bicameral Republican leaders last week proactively presented the President with multiple options for offsetting an extension of current, reduced rates. The President has not responded to that offer, yet he is scheduled to discuss the topic tomorrow at a taxpayer-funded rally at the University of Nevada-Las Vegas – a rally Boehner and Cantor are urging the President to consider forgoing so they may instead work together toward a solution.
The text of today’s letter is below, and a printable PDF version is available here.
Dear Mr. President:

Last week, we received a disappointing jobs report that showed far too many Americans are still struggling in this economy.  Young people in particular have been hit hard, with only half of recent college graduates able to find full-time work. That’s why we believe that the current, reduced rates for Stafford student loans should be extended for another year.

While the Republican-led House has already passed legislation to extend these rates, we sent you a letter, dated May 31, proposing additional savings that could be used to offset an extension.  In an effort to find common ground, all of the options are recommendations from your own budget. With rates set to double at the end of this month, we had hoped this gesture would lead to a speedy resolution of the matter.

Unfortunately, we have not received any response from your administration. In fact, in public comments yesterday the Vice President and the Secretary of Education both seemed unfamiliar with the proposals we sent you. With all of the great economic challenges facing our country, there is no reason to manufacture political fights where there is no policy disagreement. That’s why we cannot understand why you, without having responded to our latest offer, would schedule a campaign-style event in Nevada tomorrow to discuss student loan rates.

We urge you to consider cancelling tomorrow’s Las Vegas rally and instead work with us so that we can extend these rates before they expire and stay focused on additional measures to help create jobs.
Sincerely,

House Speaker John Boehner
House Majority Leader Eric Cantor
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June 5, 2012, 8:10 pm

Governors’ Races Can Be a Contrary Indicator for Presidential Elections

By NATE SILVER
The results of the recall election in Wisconsin on Tuesday night may tell us something about the future of the labor movement and the salience of collective bargaining rights as an issue to swing voters. A win by Gov. Scott Walker, who is ahead in the polls, might make other Republican governors who have sought to pare collective bargaining, like John Kasich of Ohio, breathe a little easier when they come up for election again.
But one thing that the recall is unlikely to do is tell us much about how the presidential contest in Wisconsin is likely to evolve in November. The politics for a governor’s campaign are often subject to different currents than presidential ones, and historically the party identification of a state’s governor has said little about how presidential candidates will fare there.
Over the past 40 years, in fact, the relationship has run in the reverse direction than you might expect. The Democratic presidential candidate has typically done a little better when the state’s governor is a Republican, and vice versa.

In the chart below, I’ve listed the popular vote margin in presidential elections since 1972, based on whether the governor of the state was a Democrat or Republican at the time the presidential vote took place. The values are weighted by the turnout in each state, so larger states like California have more influence in the calculation than smaller ones like Wyoming, just as they do in the overall presidential contest.


In 7 of the 10 elections since 1972, the Democratic candidate actually did slightly better in states with Republican governors, while Republican candidates did better in states with Democratic ones. The difference has been profound in some years, like 1972, 1984 and 1996.
In other years the differences have been more modest, or have run in the more intuitive direction. In 2008, for example, President Obama won states with Democratic governors by an average of about 10 points, against a 3-point margin in states with Republican ones.
Still, in the past 10 presidential elections as a whole, the presidential candidate has done a point or two better when the governor of the state is of the opposite party.
An alternative might be to look at the change in the presidential vote from one election to the next, which might do a better job of capturing the shifting dynamics in each state. However, this tells largely the same story. On average, the Democratic presidential candidate has lost two points from the previous election when the governor of the state is a Democrat, while making slight gains when the state’s governor is a Republican.


This latter pattern held true even in 2008. Although Mr. Obama did better overall in states with Democratic governors, he gained slightly more ground relative to John Kerry’s margin — adding 11 points rather than 9 points — in states with Republican governors.
What’s going on here? Causation, of course, is more difficult to interpret then correlation. The shift away from voting for Democrats in the South, which began in 1964 at the presidential level, was much more sluggish in races for governor and other statewide offices. In 1988, for instance, there were still Democratic governors in many southern states like Mississippi, Louisiana, Kentucky and Tennessee, but Michael Dukakis did not win any of those states. This Southern shift can often dominate other factors in historical analyses of trends in presidential voting.
The other hypothesis, which is interesting to contemplate but would require a more thorough analysis to demonstrate, is that voters seek to engage in a certain degree of electoral balancing. If they know their state is going to be run by a Democrat — remember, most states do not hold races for governor in presidential election years — they might be more willing at the margin to contemplate voting for a Republican presidential candidate, and vice versa.
So should Mr. Obama actually cheer a victory for Mr. Walker? I certainly wouldn’t go that far. And even if the recall election is largely irrelevant to the presidential race, it could be a leading indicator for elections where circumstances are more similar to Wisconsin, such as elsewhere that an incumbent Republican governor is on the ballot.
Still, the very same polls that have shown swing voters breaking for Mr. Walker in Wisconsin have found some of the same voters planning to vote for Mr. Obama in November. Some of these may actually be “pro-incumbent” voters who view the economy as having improved. Alternatively, Reince Priebus, the chairman of the Republican National Committee has noted, some independents and even Democrats might be mildly unhappy with Mr. Walker, but think recalling him from office early goes too far.
The reality of the presidential race is one thing, however, and the perception is another. The Romney or Obama campaigns could either react to the recall results by putting more resources into Wisconsin or by pulling them out. Those choices affect the outcome in November.
But they wouldn’t do so without exerting a strategic price elsewhere. Current polls of the presidential race in Wisconsin find Mr. Obama performing a few percentage points better there than he is in the country as a whole, an outcome that is typical for Democratic candidates in Wisconsin in recent years. The state could nevertheless be competitive, particularly if Mr. Obama’s overall standing deteriorates.
However, Wisconsin may not be as close to the electoral tipping point as other states like Ohio, Colorado or Virginia, where state polls are tracking the national numbers more precisely. Resources spent in Wisconsin could trade-off with those in these states, where a victory might be more likely to flip the entire election.
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May 25, 2012, 8:30 am

Signs of Shift Among African-Americans on Same-Sex Marriage

By MICAH COHEN
President Obama’s self-described “evolution” on same-sex marriage — from opponent to proponent — appears to be catalyzing a similar shift among some of his most loyal supporters, African-Americans. Although evidence for such a shift is preliminary — there are just a few data points and a number of caveats — Mr. Obama’s announcement may have accelerated the acceptance of gay marriage among blacks.
Support for same-sex marriage has been growing in the general population since at least the mid-1990s. That trend has been evident among blacks as well — but at a considerably slower pace. A poll conducted by Pew Research in April, just a few weeks before Mr. Obama’s announcement, found 39 percent of blacks supporting gay marriage and 49 percent opposing it. By contrast, a plurality of white Americans supported gay marriage in the Pew poll, as they have in most other recent surveys.
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Since Mr. Obama declared his support for gay marriage, however, and similar pronouncements by the N.A.A.C.P, Jay-Z and Colin Powell, a handful of polls suggest that opinions in the African-American community are shifting.
  • An ABC News/Washington Post poll conducted May 17-20 found 59 percent of African-Americans in favor of same-sex marriage.
  • A Public Policy Polling survey in North Carolina, taken just after the state approved Amendment One, which prohibited both same-sex marriage and civil unions, found that black support for legalizing same-sex marriage or civil unions had increased 11 percentage points to 55 percent in favor and 39 percent against. A poll by the same group taken before Mr. Obama’s announcement — and before the voting in North Carolina — showed 44 percent of black respondents in favor of same-sex marriage or civil unions and 51 percent against.
  • In Maryland, a Public Policy Polling survey on a referendum on the state’s new law legalizing same-sex marriage found that black support for same-sex marriage had essentially flipped after Mr. Obama’s announcement. Support for same-sex marriage jumped from 39 percent to 55 percent, and opposition dropped from 56 percent to 36 percent. Both polls in Maryland were sponsored by Marylanders for Marriage Equality, which supports gay marriage.
There is reason to be cautious in interpreting these numbers. First, polling has tended to overestimate support for same-sex marriage ballot referendums by about seven percentage points. In addition, the sample sizes for demographic subgroups like African-Americans are small, producing large margins of error.
Moreover, voters who are newly converted to a candidate or cause may support only tenuously at first and may be persuaded to revert to their prior position. “People should expect a counterargument,” Andra Gillespie, an associate professor of political science at Emory University, said.
It may also be the case that Mr. Obama’s announcement did not change minds so much as it made it easier for African-American voters to express support for same-sex marriage publicly.
A study conducted last year by Melissa R. Michelson, a professor of political science at Menlo College in California, and Brian F. Harrison of Northwestern University, “It Does Matter if You’re Black or White: Race-of-Caller Effects on Black Support for Marriage Equality,” tested whether the race of the telephone interviewer made a difference in whether an African-American respondent would express support for same-sex marriage. As the study’s title suggests, it did.
“So if it was an African-American calling an African-American, then they were much more likely to say they were a supporter of same-sex marriage,” Professor Michelson said. “We don’t think people were changing their minds, but they felt more comfortable” expressing support for same-sex marriage.
At the very least, the signs of a jump in black support for gay marriage suggest that black voters are unlikely to abandon Mr. Obama over his same-sex marriage stance, as some commentators had predicted.
“I certainly want to see several more polls. But if these kinds of early signals are being sent, then we could see a significant transformation on same-sex marriage in the African-American community,” J. Michael Bitzer, a professor of political science at Catawba College in North Carolina, said.
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2011 Worldwide Pipeline Construction Report

By Rita Tubb, Managing Editor | January 2011 Vol. 238 No. 1
Despite a global economic downturn, new oil and gas pipelines are being planned and built. P&GJ’s worldwide survey figures indicate 119,938 miles of pipelines are planned and under construction. Of these, 83,634 represent projects in the planning and design phase while 36,304 miles reflect pipelines in various stages of construction.

Construction Overview

Following is a breakdown identifying regions by levels of new and planned pipeline miles in seven basic country groupings in the report, (see area map): North America – 28,099; South/Central America – 9,869; Africa – 7,759 ; Asia Pacific Region – 41,525; Former Soviet Union and Eastern Europe – 18,896 ; Middle East – 9,345; and Western Europe and European Union - 4,445. For information on these and other pipeline projects, see P&GJ’s sister publication, Pipeline News.

North America

North American pipeline construction is expected to remain strong. Shifts in supply from traditional to unconventional sources are projected to continue to be the key driver of future pipeline construction.
The Natural Gas Pipeline and Storage Infrastructure Projections Through 2030 study, prepared for INGAA by ICF International, analyzes future natural gas infrastructure requirements under various market scenarios and anticipates a range of investments over the next 20 years, primarily to handle increased domestic production from unconventional shale basins and tight sands to the existing network. (P&GJ, Jan. 2010, Pg. 26)
The study finds the U.S. and Canada will need 28,900-61,600 miles of additional natural gas pipelines through 2030. New infrastructure will be needed throughout the U.S. and Canada and not just to move natural gas across long distances between regions. According to the study, all regions will need natural gas infrastructure to serve growing demand and/or shifts in demand. Even regions with mature production basins will continuously need additional development.
North America accounts for 19,260 miles of planned pipeline miles and 8,839 miles of pipelines under construction. More than 4,600 miles of the planned pipelines represent projects in Alaska and Canada. They include the 364-mile Beluga to Fairbanks (B2F) gas pipeline that calls for a 24-inch line extending from Cook Inlet to Delta Junction and a 12-inch line from Delta Junction to Fairbanks. The project will be a spur pipeline to a major Alaska natural gas pipeline, when one is built, to move gas into south-central Alaska markets, with a connection at Delta Junction or Glenmallen.
Although both of the Alaska natural gas pipeline projects planned by TransCanada and ExxonMobil and BP/Conoco Phillips (Denali) have held open seasons, neither is expected to begin service until around 2020.
Another project involves a 700-mile NGL pipeline planned in Texas by DCP Midstream. The route of the DCP Sandhill Pipeline runs from West Texas fractionation and storage sites along the Texas Gulf Coast including Mont Belvieu.
DCP says this system should relieve capacity constraints affecting producers in these regions. The DCP Sandhills Pipeline, with an estimated 2013 in-service date, will have a target capacity of 130,000 bpd.
As to construction activity, the most significant North American construction project is TransCanada’s U.S.-Canada cross border Keystone XL Gulf Coast Expansion Project. The route of the 1,661-mile, 36-inch crude oil pipeline begins at Hardisty, Alberta and extends southeast through Saskatchewan, Montana, South Dakota and Nebraska. It incorporates a portion of the Keystone Pipeline (Phase II) through Nebraska and Kansas to serve markets at Cushing, OK before continuing through Oklahoma to a delivery point near existing terminals in Nederland, TX to serve the Port Arthur, TX marketplace.
The $7 billion Keystone XL Expansion is scheduled to begin operations in 2012.

Asia Pacific

Several countries are undertaking massive construction projects to meet growing energy demand. Not surprisingly, the region accounts for the highest number of new and planned pipeline miles. Of the 41,525 miles of new and planned pipelines, 29,072 miles represent pipelines in the engineering and design phase, while 12,453 miles reflect projects in various stages of construction with China, India and Australia remain the most active.
State-owned China National Petroleum Corp. (CNPC), China’s largest natural gas company in the upstream and downstream sectors, is responsible for much of the activity. Plans are also in place to expand the oil and gas pipelines owned and operated by CNPC by more than 24,850 miles, or 80%, between 2011-2015.
CNPC is building the 285-mile Rizhao-Dongming oil pipeline that will carry crude from the Lanshan port of Rizhao, Shandong, to the Dongming refinery in Heze. The first phase has a designed transmission capacity of 10 MMt/a of crude. A second phase calls for expanding capacity to 20 MMt/a. Once completed, the area’s independent refineries will receive 10 MMt/a of crude from the Middle East, easing a feedstock storage in the production of fuel oil.
Pipelines are also being completed here. The Russia-China Crude Pipeline that extends from the Skovorodino off-take station of Russia's Far East Pipeline, through Galinda at the Russian border, Heilongjiang province and Inner Mongolia, to Daqing terminal station, is complete. With designed deliverability of 15 MMt/y, the pipeline is 640 miles with 40 miles in Russia and 600 miles in China. The pipeline became operation at the end of 2010 and allows Rosneft to begin supplying 15 metric tons of crude to China annually for the next 20 years.
One of China’s most ambitious projects is a 1,970-mile pipeline network to supply gas to 21 cities in the province of Guangdong by 2020. A joint venture of China National Offshore Oil Corp., Sinopec and the provincial power firm, Guangdong Yuedian Group, construction began in early 2010. Phase one of the pipeline grid, totaling 290 miles and linking seven cities, should be operational by July.
In India, Gail (India) Ltd. is working to complete several major projects. One involves the 790-mile Jagdishpur-Haldia pipeline that will carry natural gas from the Mahanadi and KG basins to the four states of Uttar Pradesh, West Bengal, Jharkhand and Bihar. The first phase calls for construction of 497 miles of 36-inch mainline while the second phase will mainly include construction of spur lines. Completion of the entire project is set for 2013.
Construction of Gail’s 510-mile Dabhol to Bangalore gas pipeline is scheduled for completion in early 2012.

Australia

In Australia, LNG action is heating up where eight new LNG terminals are scheduled to be completed by 2015. One project is by Australia Pacific LNG (APLNG), a 50/50 joint venture between Origin Energy and ConocoPhillips, to deliver coal seam gas (CSG) to an LNG plant at Gladstone that will have a processing capacity of up to 18 MMt/a. The 280-mile pipeline from the CSG field to the LNG plant will be built by a McConnell Dowell and Consolidated Contractors joint venture. Construction of the pipeline will start this year with completion at the end of 2013.
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BG Group subsidiary, Queensland Gas Company, is developing the Queensland Curtis (QCLNG) project that involves an onshore CSG and LNG production and export facility on the Queensland coast. The supply of CSG from QGC’s Surat basin tenements will be carried via a 212-mile, 42-inch pipeline to processing facilities on Curtis Island, near Gladstone.
QGC officials say the project is well under way and, pending approvals, first delivery of LNG will be in 2014.
In western Australia, Chevron Australia and its joint venture partners ExxonMobil, Shell, Osaka Gas, Tokyo Gas and Chubu Electric Power recently began work on the multibillion-dollar Gorgon Project.
The project will develop the Greater Gorgon area gas fields, located 80 miles off the northwest coast of western Australia. It includes construction of a 15 MMt/a LNG plant on Barrow Island and a domestic gas plant with the capacity to provide 300 Tj/d of gas to western Australia.
The project is expected to have the world's largest CO2 injection system and be a global leader in underground carbon dioxide injection technology. First gas is planned for 2014.
In Malaysia, work is winding down on the country’s largest pipeline project. Valued at US$500 million, the Sabah Sarawak Gas Pipeline is being built for Petronas Cargali Sdn Bdh, a subsidiary of the state oil and gas major. The 318-mile, 36-inch pipeline will link the proposed Sabah oil and gas terminal to the Petronas LNG complex in Sarawak. Project completion is scheduled in March.

FSU-Eastern Europe

Russia, along with several other FSU and Eastern European nations, continues to work on extensive export pipeline networks to reach Europe and the Asia Pacific region.
Nord Stream is a major project aimed at delivering natural gas to Europe. It consists of two parallel pipelines which will be laid across the Baltic Sea from Vyborg, Russia to Greifswald, Germany. The pipeline will be built and operated by Nord Stream AG. The first, with a transmission capacity of 27.5 Bcm/a, is due for completion in 2011. A second parallel line is due to be completed in 2012, doubling capacity to around 55 Bcm/a.
When fully complete, Nord Stream will supply the energy needs of 26 million European households. The total investment amounts to EUR 7.4 billion. The Nord Stream joint venture consists of Gazprom, Germany’s E.ON and BASF/Wintershall and the Dutch company Gasunie.
The multimillion-dollar Azerbaijan-Georgia-Romania Interconnection (AGRI) is being undertaken by the governments of Azerbaijan, Georgia, and Romania to develop a transport corridor running via the Caucasus and the Black Sea.
The project calls for construction of LNG terminals in Georgia and on the Romanian Black Sea coast. The terminals would allow gas from Azerbaijan to flow via pipeline across the Caucasus to Georgia where it would be liquefied at a planned terminal at Kulevi, then shipped in tankers across the Black Sea to the Romanian coast. There, the LNG would be regasified, pumped into the Romanian gas grid, and delivered into the wider European market.
Preliminary estimates for construction of the two LNG terminals put the cost at US$5.4-8.1 billion. The AGRI project would be expected to transport up to 7 Bcm/y of gas in about three years.

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South Stream is yet another pipeline scheduled to be built across the Black Sea that will extend to southern and central Europe to deliver Russian gas, bypassing transit states such as Ukraine. Gazprom and Eni SpA plan to construct the 560-mile pipeline. Gazprom has defined locations for key facilities of the new pipeline, obtained all the permits required from executive authorities in the specified Russian regions and the approvals from land users in the municipalities. All preparations and design work are to be completed by September 2012. Construction operations are to begin no later than October. The first leg of the gas pipeline is scheduled for commissioning in late 2015.
In Turkmenistan, construction is under way on the $2 billion East-West pipeline that will ultimately connect all the major gas fields of Turkmenistan to a single network. Two state corporations – Turkmengaz and Turkmen Oil and Gas Construction – have undertaken the project. The 620-mile, 56-inch pipeline will have capacity of 30 Bcm/a.

Middle East

With the Middle East accounting for four countries that are among the world’s top ten oil producers, they are also heavily dependent on oil export revenues. For this reason, pipelines are being planned and built. Of the 9,345 miles of new and planned pipelines, 5,837 miles represent projects in various stages of design and development, while 3,508 miles reflect actual construction.
In the UAE, Abu Dhabi Company for Onshore Oil Operations (ADCO) awarded a contract valued at US$683 million to state-owned National Petroleum Construction Company (NPCC) for a 595-mile pipeline. NPCC will handle the engineering, procurement and construction (EPC) as well as production well tie-ins and flowlines to connect the field to four new production sites. The project is expected to take 30 months to increase capacity of the Bab field from 1.4 MMbpd to 1.8 MMbpd. Southwest of Abu Dhabi City, the Bab oil field holds more than 500 MMbbls of proven oil reserves and is pumping 300,000 bopd.
In Iraq, Foster Wheeler’s Global Engineering and Construction Group was awarded a project management consultancy (PMC) services contract by South Oil Company (SOC) for the Iraq Crude Oil Export Expansion Project onshore in southern Iraq and offshore in Iraqi waters. SOC is under the Ministry of Oil of Iraq.
The project includes installation of two onshore and offshore pipelines plus three single- point moorings and a central manifold and metering platform. Scheduled for completion in 2013, the project is expected to boost Iraq’s Basra export capacity from 1.8 MMbpd to 4.5 MMbpd by 2014. Work should be completed by July 2013.
Khatam Ol Anbia Construction will build the second phase of the remaining 167-mile section of the Iranian portion of the Iran-Pakistan (IP) Pipeline project for the National Iranian Gas Company. Reports say Iranian gas will be delivered to Pakistan in 2014. The 560-mile line will extend from the Assaluyen field in southern Iran to Pakistan.

Western Europe/European Union

As reported by P&GJ in August, pipeline construction continues to lag in many EU nations; this is expected to change with a decision by the European Commission to provide US$1.9 billion in grants to ensure that some 30 gas projects are not delayed. Those to receive grants include the 500-mile Interconnector Turkey-Greece-Italy (ITGI) project, 130-mile Poseidon Pipeline, 281-mile Skanled Pipeline, 2,050-mile Nabucco Pipeline and the 130-mile Slovakia- Hungary Interconnector, plus upgrades to Slovenia’s transmission system.
Italy’s power and gas company Edison SpA announced a major step to move the Southern Gas Corridor forward when Edison, Depa, the Greek Public Gas Corporation, IGI Poseidon S.A. (equally owned by Edison and Depa and responsible for construction of the offshore pipeline between Greece and Italy) and Bulgarian Energy Holding EAD, agreed to establish Natural Gas Interconnector Greece Bulgaria EAD (IGB EAD). This company is responsible for the new gas pipeline between Greece and Bulgaria (the IGB pipeline) which will be part of the ITGI project connecting Turkey, Greece and Italy.

Africa

Although its countries are vital to world energy markets, strikes, attacks on pipelines, civil unrest and hostage-taking continue to hamper oil and gas producers in most of the region. Despite these challenges, pipeline are being planned and constructed.
Saipem was awarded a subcontract for a critical crude pipeline replacement project in Nigeria. The project involves replacement of six 10–24-inch pipelines with a combined length of 53 miles which will connect six platforms in an offshore field. The scope of work includes fabrication, transportation, installation and testing of the new pipelines as well as a shore approach and bridges. Saipem will carry out the offshore activities, predominantly with the Crawler pipelay vessel, into the second quarter of 2011.
One of the most ambitious projects is the Trans-Saharan Gas Pipeline (TSGP) planned by the Nigerian National Petroleum Company and Algeria’s Sonatrach. Nigeria, Niger and Algeria signed an agreement to move forward with construction of the project. Energy ministers from the three nations indicate there is no need to bring international companies into the project although France’s Total, Russia’s Gazprom and the European Union have displayed an interest in providing assistance. EU officials say the pipeline could supply 20 Bcm/y of gas to Europe by 2016.
As proposed, the 2,565-mile project will take gas from fields in the Niger Delta north through Nigeria to Algeria and then to the coast. It could be on line in 2015 if all goes according to plan. Estimated cost of the project is in the $10 billion range with $3 billion for upstream gas development.

South/Central America & Caribbean

New and planned pipeline projects continue to grow with several South, Central America and Caribbean countries implementing new construction projects.
Petrobras, which typically maintains an aggressive pipeline construction program, plans to join five partners and invest $3 billion to build three pipelines to transport ethanol from Brazilian sugarcane fields to local markets and for export.
The planned pipelines will have a total length of 750 miles and carry up to 20 MMcm/y by 2020.
The shareholders in the new company will be Petrobras, with 20%; Cosan SA Industria e Comercio SA, 20%; Copersucar SA, 20%; Odebrecht Transport Participacoes SA, 20%; Camargo Correa Oleo e Gas SA, 10% and Uniduto Logistica SA, 10%.
The first of the three pipelines will run from Senador Canedo in Goias state, center-west Brazil, through Minas Gerais and Sao Paulo states to Sao Sebastiao port in Sao Paulo state.
Another system will link the states of Goias, Sao Paulo and Parana, ending at Foz do Iguacu, using river transport on the Parana and Tiete rivers, with a pipeline link to the first pipeline.
A third pipeline will link the first pipeline with Ilha d'Agua port in Rio de Janeiro state.
In Boliva, Transredes S.A. is building the Carrasco-Cohabamba gas pipeline for YPFB Transport. YPFB inaugurated the first stretch of the $172 million pipeline that increases supply to the west of the country to 130 MMcf/d. The first stretch runs 67 miles and the third stretch - completed last year - runs 40 miles. The second and final 48-mile leg is due for completion in 2011. The company expects additional expansions to pipeline capacity through compression.
In Peru, construction is under way on the 136-mile Humay–Marcona Pipeline in the Ica region. The pipeline will transport natural gas to the cities of Ica, Nasca and San Juan de Marcona and is part of a larger distribution project which includes construction of the 23-mile Humay–Pisco Pipeline. Congas, a consortium comprised of Colombian companies EEB and TGI, was contracted to design, build, operate and maintain the system by Peru in 2008. The project is expected to be online mid-2012.
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2012 Worldwide Pipeline Construction Report

By Rita Tubb, Managing Editor | January 2012, Vol. 239 No. 1
P&GJ’s worldwide survey figures indicate that 118,623 miles of pipelines are planned and under construction. Of these, 88,976 represent projects in the planning and design phase; 29,647 miles reflect pipelines in various stages of construction.
Natural gas pipelines again account for the majority of projects under construction and planned.
Supporting this is a GlobalData report that indicates approximately 75% of the total global planned pipeline additions during 2011-15 will be gas. The report says the Asia Pacific region should be responsible for 41.8% of total planned pipeline additions with China and India being the frontrunners.

Construction Overview

Following is a look at new and planned pipeline miles in the seven basic country groups, (see area map): North America – 31,951; South/Central America and Caribbean – 11,571; Africa – 7,617; Asia Pacific 34,295; Former Soviet Union and Eastern Europe – 19,537; Middle East – 11,480; and Western Europe and European Union – 2,172. For information on these and other pipeline projects, see P&GJ’s sister publication, Pipeline News.

North America

Nothing has changed the outlook for the North American energy industry quite like the discoveries in the shale regions in the U.S. and Canada. North America - which accounts for 26,300 miles in the planning stages and 5,651 miles under construction - should remain strong.
Those building pipelines in shale regions can expect higher costs. Ziff Energy Group reports pipeline owners are seeing higher construction costs in the shale regions of Marcellus, Eagle Ford, Haynesville, Barnett, Woodford, Fayetteville, and Horn River.
After analyzing costs of 120 pipelines from the past decade, Ziff Energy Group’s results show the average estimated shale gas pipeline rose in 2011 to almost $200,000/inch-mile, three times higher than 2004.
“All North America geographical regions appear to experience consistently higher pipeline costs than prior years,” commented Julia Sagidova, gas analyst and lead
author of the report. “The Marcellus shale gas region (Pennsylvania) is the most expensive with an average cost of under $300,000/inch-mile. These large-diameter (24-36 inches) projects are typically 120 miles in length and cost $500 million.”
The report noted that the 30% rise in steel costs over the past year along with new industry regulations and practices to reduce right-of-way and minimize environmental effects are driving up construction costs.
In North America, work is progressing on DCP Midstream’s 700-mile Sandhills Pipeline. DCP is using new construction and existing pipeline to build a 100,000-120,000-bpd NGL pipeline that will run from West Texas to Mont Belvieu in East Texas. The pipeline will be phased into service, with the first completed in the third quarter to accommodate DCP’s growing Eagle Ford liquids volumes. Service to the Permian Basin will be available as soon as the Q2 2013.
Greencore Pipeline Company LLC, a fully owned subsidiary of Denbury Resources Inc., is building the 231-mile, 20-inch Greencore CO-2 Pipeline from the ConocoPhillips Lost Cabin Gas Plant in Fremont County, WY, to a point in the Bell Creek oil field in Powder River County, MT. The CO-2 transported by the Greencore Pipeline will be used for enhanced oil recovery at the existing Bell Creek oil field. Completion is scheduled in late 2012.
Still awaiting a construction start is TransCanada’s $7 billion Keystone XL Pipeline. The route of the 1,661-mile, 36-inch crude oil pipeline begins at Hardisty, Alberta and extends southeast through Saskatchewan, Montana, South Dakota and Nebraska.
Late last year, the State Department announced it would delay a final verdict on whether the pipeline is in the national interest until early 2013 in order to conduct an environmental analysis of an alternative route that would navigate the pipeline away from environmentally sensitive areas in Nebraska.
North America also accounts for several pipelines in the planning and engineering phase, including Kinder Morgan’s 240-mile Cochin Marcellus Lateral Pipeline that will originate in Marshall County, WV and terminate at an interconnect with the KM Cochin Pipeline in Fulton County, OH. Once completed, the pipeline will transport NGLs from the Marcellus producing region of Pennsylvania, West Virginia, and Ohio to fractionation plants and petrochemical facilities in Illinois and Canada. The target in-service date for the pipeline is mid-2012.
Enterprise Products Partners L.P. plans to build a 1,230-mile pipeline to transport ethane from the Marcellus and Utica shale regions in Pennsylvania, West Virginia and Ohio to the company’s natural gas liquids storage complex at Mont Belvieu, The pipeline would have an initial capacity of 125,000 bpd and can be expanded to meet increased shipper demand. Commercial operations are slated in Q1 2014.
Oneok Partners will invest $910 million to $1.2 billion by late 2013 to: 1) construct the new 570-mile, 16-inch Sterling III NGL Pipeline to transport either unfractionated NGLs or NGL purity products from the Midcontinent to the Texas Gulf Coast; 2) reconfigure its existing Sterling I and Sterling II NGL distribution pipelines to transport either unfractionated NGLs or NGL purity products; and 3) build a 75,000-bpd NG fractionators, MB2, at Mont Belvieu. The Sterling III Pipeline will cost between $610-810 million and have an initial transport capacity of 193,000 bpd with possible expansion to 250,000 bpd. The pipeline will traverse the Woodford shale and provide transport capacity for NGL production from the growing Cana-Woodford Shale and Granite Wash play. Completion is scheduled in 2013.
Getting Alaska’s North Slope (ANS) natural gas to market has been an elusive goal since oil production started in the late 1970s. Plans to build a major natural gas pipeline to deliver ANS natural gas to markets have come and gone over the years. One project still being evaluated to deliver North Slope natural gas is the 1,717-mile TransCanada-ExxonMobil Alaska Pipeline that would extend from Prudhoe Bay to points near Fairbanks, and Delta Junction, AK and then to the Alaska-Canada border where it would connect to a new pipeline that will link up with the pipeline system near Boundary Lake, AB.
TransCanada plans to file permitting applications in both the U.S. and Canada in Q4 2012 with approvals anticipated in Q4 2014. Construction of the $32 -41 billion project is scheduled to start in 2015 with first gas being available in mid-2020.
Still awaiting a development decision is Canada’s Mackenzie Valley natural gas pipeline project that received the stamp of approval from an independent panel charged with considering the environmental, social and economic impacts of the proposed $16 billion, 743-mile line on the Northwest Territories.
In Mexico, a McDermott International subsidiary completed a project to install three oil and gas pipelines for PEMEX Exploración y Producción in the Bay of Campeche.

Asia Pacific

Countries in the Asia Pacific region are undertaking massive construction projects to meet growing energy demand. The region accounts for the highest number of new and planned pipeline miles. Some 20,234 miles represent projects in the engineering and design phase; 14,061 miles reflect projects in various stages of construction with China, India and Australia the most active areas.
Work is winding down on one of China’s most significant projects: Petro China’s second West-to-East natural gas pipeline. Eight regional lines should be completed by June. The pipeline will carry 30 Bcm/a of gas from central Asia and northwest Xinjiang Uygur Autonomous Region to the Yangtze and Pearl River deltas.
Total pipeline length, including regional lines, is 5,656 miles. The project traverses 15 provincial regions and will serve more than 400 million people.
A third West-to-East gas pipeline project is expected to take more than 20 Bcm/a of gas from central Asia; a fourth and fifth are planned in the future.
China's first West-to-East pipeline, which pipes gas from Tarim Basin of Xinjiang to Shanghai, is designed to transmit 12 Bcm/a of natural gas.
In Yunnan Province, China National Petroleum Corp. (CNPC) is building two pipelines and a refinery to transport and process oil and natural gas from Myanmar starting in 2014. The planned 550,000-bpd oil pipeline and the 12 Bcm/d gas pipeline will each require 500 miles of construction in Myanmar to the China border city of Ruili. The two lines will then extend another 1,056 miles in Yunnan Province before reaching their destination.
In India, a consortium of four state-run companies led by Gujarat State Petronet Ltd. (GSPL) has received contracts for construction of three major pipeline projects. The contracts are for the 951-mile from Mallavaram-Bhilwara in the southern state of Andhra Pradesh to Bhilwara in the northern state of Rajasthan, the 1,025-mile Mehsana-Bhatinda pipeline from western to northern India and the 466-mile pipeline to Jammu and Kashmir from Bhatinda.
In Thailand, Punj Lloyd is building a 185-mile pipeline for PTT LNG to transport gas from an LNG terminal near Rayong. The project requires 45 horizontal directionally drilled crossings and is set for completion by year-end 2013.

Australia/Papua New Guinea

LNG continues to be the big newsmaker in Australia which accounts for seven sites under construction and eight more in the planning or engineering phase.
Marking the start of one of the country’s latest mega-projects is the $16 billion Santos GLNG LNG plant on Curtis Island. The plant includes the development of coal seam gas (CSG) resources in the Bowen and Surat Basins in southeast Queensland, construction of a 261-mile gas transmission pipeline from the gas fields to Gladstone, and two LNG trains with a combined nameplate capacity of 7.8 mtpa on Curtis Island.
Once completed, GLNG alone will supply 11% of Korea’s domestic gas needs and 9% of Malaysia’s gas consumption. First LNG exports should start in 2015.
In western Australia, Chevron Australia and its joint venture partners ExxonMobil, Shell, Osaka Gas, Tokyo Gas and Chubu Electric Power are working on the multibillion-dollar Gorgon Project. The project will develop the Greater Gorgon area gas fields, located off the northwest coast where five fields have been discovered.
In Papua New Guinea, Esso Highlands Ltd., operator of the PNG LNG project, continues to make progress on meeting the 2014 startup window. Esso awarded the EPC contract to a joint venture of Chiyoda and JGC Corp. for a 6.6 MMt/a LNG plant, with two trains. The contract includes construction of the 435-mile natural gas pipeline from Southern Highlands to Port Moresby in PNG. The pipeline work is projected to be completed when the $10 billion LNG project gets off the ground in 2014.

FSU- Eastern European Countries

Russia and nations in the FSU and Eastern Europe hold promise for future oil and gas activity and several are constructing and planning extensive pipeline networks to Europe and the Asia Pacific region.
Nord Stream AG inaugurated the Nord Stream twin pipeline system on Nov. 11 which runs from Vyborg, Russia to Lubmin near Greifswald, Germany. The two 760-mile offshore pipelines are the most direct connection between the vast gas reserves in Russia and energy markets in the European Union. When fully operational later this year, the pipelines will have capacity to transport a combined total of 55 Bcm of gas a year to the EU for at least 50 years.
Construction of Line 1 of the twin pipeline system began in April 2010 and was completed in June 2011. It began transporting gas in November 2011. Construction of Line 2, which runs parallel to Line 1, began in May 2011. The second line is planned to come on stream later this year. Each line has a transport capacity of 27.5 Bcm/a of natural gas.
Transneft is contractor and operator on the Zapolyarye-Purpe oil pipeline project. The 310-mile Zapolyarye-Purpe pipeline, with capacity to ship up to 45 MMt/a of crude, will transport oil from the Yamal-Nenets Autonomous District and northern Krasnoyarsk territory. Some 750 miles of supply lines will need to be built. Zapolyarye-Purpe will connect fields on the Yamal Peninsula to the Eastern Siberia-Pacific Ocean pipeline (ESPO).
The pipeline will be constructed in three phases with the final phase scheduled for completion in 2016.
Transneft reports that the second stage of the East Siberia-Pacific Ocean (ESPO) pipeline carrying Russian crude to Asian-Pacific markets and the U.S. should be in service by year end, well ahead of schedule. The first part carrying 30 MMt/a of East Siberian crude to Skovorodino near the Chinese border was launched in 2009. Once the second part of the ESPO pipeline from Skovorodino to Kozmino is completed, capacity to the Pacific coast will increase to 30 MMt/y.
Work got under way last year on Kazakh’s KazTransGas and China’s Trans-Asia Gas Pipeline Co. Ltd.’s Beineu-Bozoy-Shymkent Gas Pipeline, which is the second stage of the Kazakhstan-China Gas Pipeline. The 916-mile project will be built in two phases; the first involves laying 723 miles from Bozoy-Shymkent and constructing a compressor station near Bozoy. This phase is set for completion in 2012. Second-phase activity, to be completed from 2014-15, includes a 193-mile section from Beineu–Bozoy and a compressor station in Karaozek. Another 26 branches will be built from the mainline during the first and second phases to supply communities along the route.
BP has proposed an alternative pipeline project to feed Europe with Caspian natural gas. The South East Europe Pipeline would link a major Azerbaijan gas field to a hub in Austria running from western Turkey across Bulgaria and Romania to Hungary’s border, a similar route to that of EU-backed Nabucco pipeline. South East Europe Pipeline would be 810 miles, one-third the length of Nabucco, making it a more economical project.
As operator of the Shah Deniz field - the main Azeri gas natural field - BP may have influence over which pipeline the Shah Deniz consortium will choose.
Two other pipelines - Nabucco and Russian-backed South Stream - are proposed to tap Azeri gas for export to Europe. A final investment decision on the $20 billion Azeri development is expected in 2013.
Gazprom and China National Petroleum Corporation (CNPC) plan to partner to build the 1,616-mile Altai Pipeline to deliver natural gas from western Siberia to northwestern China. The contract period is 30 years and the supply volume, upon reaching design capacity, will be 30 Bcm/yr. First supplies are planned for 2015.

Africa

Limited energy development in Africa is due to political, economic, operational and geopolitical risks. The region accounts for 6,683 miles of planned pipelines and 934 miles under construction.
One area that may hold promise for near-term activity is Nigeria. At the World Petroleum Congress in Qatar, Minister of Petroleum Resources Diezani Alison-Madueke outlined $130 billion in investment plans for oil and gas sectors over the next five years, calling for construction of 1,245 miles of oil and gas pipelines to boost domestic gas supply, a petrochemical plant, new fertilizer and manufacturing plants and three greenfield refineries.
Also in Nigeria, Shell Petroleum Development awarded a contract to Saipem for the Otumara-Saghara-Escravos Gas Pipeline. The 26-mile pipeline, ranging from 2 to 12 inches, will collect 30 Mcf/d of processed associated gas from the western Niger Delta and send it through the Escravos-Lagos system to the domestic market.
Total E&P Angola is developing the CLOV project - an integrated development of a four-field offshore cluster. A total of 34 subsea wells will connect to the CLOV FPSO unit which has processing capacity of 160,000 bopd and storage capacity of 1.78 million barrels.
Serimax is conducting the welding works for the project that involves 500 welds of 10- and 12-inch pipe. The pipe will be installed in 1,000-1,400 meters of water. Project completion is due in 2013.
Total Gabon awarded the Sea Trucks Group a contract to install a 20-mile, 18-inch concrete-coated gas pipeline between the Anguille and Torpille fields off Gabon. The installation work is expected to start this spring.
China and Tanzania signed a $1 billion loan agreement to build a natural gas pipeline in East Africa. The 330-mile pipeline would extend from southern Tanzania to the capital, Dar es Salaam. The 36-inch pipeline will have transport capacity of 784 MMcf/d.
Awaiting a construction start is the 2,565-mile Trans-Saharan Gas Pipeline (TSGP) planned by the Nigerian National Petroleum Company and Sonatrach. Total, Gazprom and the European Union have all displayed an interest in assisting construction. EU officials say the pipeline could supply 20 Bcm/y of gas to Europe by 2016.

Western Europe/EU

While pipeline activity in Western Europe and EU Countries was expected to increase following a decision by the European Commission to provide US$1.9 billion in grants to ensure that some 30 gas project would not be delayed, the growing financial crisis among many EU countries could derail near-term activity.
Those projects scheduled to receive grants include the 500-mile Interconnector Turkey-Greece-Italy (ITGI) project, 130-mile Poseidon Pipeline, 281-mile Skanled Pipeline, 2,050-mile Nabucco Pipeline, 235-mile Odessa-Brody project and the 130-mile Slovakia- Hungary Interconnector.
One area where pipeline work is under way and planned is the North Sea.
Subsea 7 is working under an EPIC contract from Total E&P UK Limited on the Laggan and Tormore deepwater gas field development located west of Shetland in the North Sea. Subsea 7’s principal scope of work comprises the engineering, fabrication and installation of 88 miles of 8-inch and 2-inch piggy-backed service pipelines and the engineering, supply and installation of 1 x 77-mile control umbilical and associated subsea structures and tie-ins.
Phase 1 offshore operations encompassing pipelines and umbilical installations and pre-commissioning activities are scheduled to start shortly. Phase 2 offshore operations, encompassing tie-in and commissioning activities, are scheduled to start in 2013.
Saipem is installing a subsea pipeline in the Ormen Lange northern field development in the Norwegian Sea for A/S Norske Shell. The project is being developed with a subsea template located in 900 meters of water and tied back to Ormen Lange by two 12-inch production pipelines, a 6-inch service line and a control umbilical.
In the Barents Sea, Eni Norge awarded a contract to Technip valued at 200 million Euro for the Goliat field development. Goliat will be the first Norwegian oil-producing field north of the Arctic Circle in the Barents Sea. It is located 59 miles northwest of the city of Hammerfest on the Norwegian coast. Offshore installation work is scheduled to be carried out over three construction seasons from 2011-13.

Middle East

In the Middle East 8,805 miles of pipelines are planned and 2,675 miles are in various stages of completion.
RASGAS (joint venture between Qatar Petroleum and ExxonMobil) plans to develop the multibillion-dollar Barzan natural gas project in the North Field reservoir offshore Qatar in the Arabian Gulf. Work includes a natural gas offshore production system with conventional wellhead platforms, intrafield pipelines, 180 miles of up to 24-inch export pipeline to the onshore Barzan Gas Plant in Ras Laffan Industrial City (RLC). First-phase production is scheduled at 1.5 Bcf/d.
In Saudi Arabia, Saudi Aramco awarded an EPIC contract to Saipem for the Al Wasit Gas development of the Arabiyah and Hasbah offshore fields. This encompasses 12 wellhead platforms, two tie-in platforms and an injection platform, a 36-inch, a 160-mile export trunkline, 125 miles of mono-ethylene glycol (MEG) pipelines, 125 miles of subsea electric and control cables and 25 miles of offshore flowlines. Also included are shore approaches and 75 miles of onshore pipelines.
ConocoPhillips and Abu Dhabi National Oil Company (ADNOC) awarded the Shah Gas project in Abu Dhabi to the Al Jaber Group. The project requires construction of facilities including gas-gathering systems, processing trains and product pipelines.
Adnoc has said it expects first production by late 2013 or early 2014.
In the UAE, Technip, in consortium with NPCC, was awarded an EPC contract by ZADCO for the Satah Full Field Development project, 124 miles northwest of Abu Dhabi. The $500 million contract includes offshore brownfield works to existing wellhead platforms and production manifold platform, installation of infield pipelines, as well as modifications and installation of facilities at the onshore Satah plant at Zirku Island.
Leighton Offshore is working under a $58 million contract from Iraq’s South Oil Company as part of the Crude Oil Export Facility Reconstruction Project (Sea Line Project). This involves developing two offshore platforms, a 47-mile, 48-inch oil pipeline and a Single Point Mooring system. The project will expand export capacity by building a pipeline connecting storage sites to the offshore crude oil export terminal near Basra in southern Iraq.
Foster Wheeler’s Global Engineering and Construction Group was awarded a project management consultancy (PMC) services contract by South Oil Company (SOC) for the Iraq Crude Oil Export Expansion Project. This calls for installation of two onshore and offshore pipelines plus three single-point moorings and a central manifold and metering platform. Scheduled for completion in 2013, the project is expected to boost Basra export capacity from 1.8 MMbp/d to 4.5 MMbp/d by 2014.

South & Central America/Caribbean

Several South, Central American and Caribbean countries are implementing plans for new pipeline infrastructure.
In Brazil, Petrobras is constructing a 530-mile ethanol pipeline to link the main ethanol- producing regions in Minas Gerais and São Paulo to the large consuming centers of São Paulo and Rio de Janeiro. The pipeline will have capacity to transport 21 MMcm/a.
The first section will extend 125 miles from Ribeirão Preto to Paulinia. Phase two involves construction northward through states in the mid-west. The system will be extended to Barueri and Guarulhos in greater São Paulo and Duque de Caxias in Rio Di Janeiro. The pipeline should be brought online in 2014.
Pacific Rubiales Energy Corp. has partnered with EXMAR to develop an LNG export project in northern Colombia. The project involves construction and development of a liquefaction and regasification barge, a small-scale vessel designed to deliver LNG to industrial consumers, and development of a pipeline from the company's La Creciente gas field to the Caribbean coast.
Front-end engineering and design have begun. The project and pipelines are expected to be operational in 2013.
A recent Rigzone report outlined an MOU calling for a joint venture by Russia’s Rosneft and Petroleo de Venezuela (PDVSA) to develop heavy crude oil reserves in Venezuela as part of the Carabobo-2 project. Crude oil production is expected to peak at above 400,000 bpd.
It the plan goes forward, work will cover the exploration and development cycle as well as construction of surface facilities and pipelines. There are plans to add a special processing facility (upgrader) with a capacity of 200,000 bpd to bring extracted oil up to commercial quality. Commercial oil will be transported for export to the Araya port through a trunk pipeline to be built by PDVSA.
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