As the US Congress pushes for an approval vote for the highly controversial Keystone pipeline this week, ironically the project may no longer be economically viable.
With West Texas crude today hovering just over $74 a barrel–down 50% since 2008, and 30% since just June–the price is already well below the estimated break even costs cited by Keystone proponents. See: Economics no longer make Keystone pipeline viable
“The so-called “heavy oil” extracted from sand in Alberta, which the proposed pipeline would carry to Nebraska, en route to refineries on the Gulf Coast, will cost between $85 and $110 to produce, depending on which drilling technology is used, according to a report in July by the Canadian Energy Research Institute, a nonprofit whose work is often cited by Keystone proponents.”
With the US dollar still surging and the global economy slowing, price support for oil may be much lower still as marked below.
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