A new year and a new administration in the White House has brought on a new era in oil and gas pipeline development. As many in the industry expected, President Joe Biden revoked the Presidential Permit for the Keystone XL pipeline on his first day in office.
This move signals that the era of large-scale pipeline projects that span multiple state — or international — borders is over. However, the writing has been on the wall for some time. In an article last year, titled “A New Era of Pipeline Development,” industry experts we spoke to indicated
that third-party opposition to oil and gas pipeline projects had already scored significant victories against the industry.
“We’re seeing a paradigm shift in the approach special interest groups are taking to stop pipelines,” said Mike Castle Jr., president and CEO of Progressive Pipeline and president of the American Pipeline Contractors Association (APCA), in the above-mentioned article published in our September/October issue. “Before they could go through the individual states to hold up pipelines. The current administration put requirements on states to act within 90 days. The opposition has found a new way to work around that requirement. It’s going to continue to be a cat and mouse game going forward.”
With the Biden administration focusing on policies to limit greenhouse gas emissions and fight climate change, oil and gas pipeline projects will likely encounter major obstacles to win approval. However, we all know that oil and gas are not going away anytime soon, and pipelines remain the safest method of transporting products from source to end-user.
The question now becomes, how does the pipeline industry move forward? One solution may be to focus on building smaller, intrastate pipelines that won’t face as many obstacles. Another solution is to expand capacity on existing pipelines by upgrading compression stations and other modifications.
From recent discussions I’ve had with industry stakeholders, the midstream pipeline sector is likely facing a significant downswing. Meanwhile the distribution market has seen strong growth with projects aimed at replacing aging infrastructure to improve safety and integrity — and those projects appear likely to continue.
With that in mind, North American Oil & Gas Pipelines will be turning our attention more on the distribution market, as well as covering business practices to help companies adapt to this near era.
Starting with this issue, you’ll find a new section titled “Distribution Focus” that highlights this growing sector of the pipeline industry. Throughout 2021, we’ll be exploring the people, projects and practices that are working to preserve energy independence, as well as how your company can benefit from these trends.
There may be choppy waters ahead, but North American Oil & Gas Pipelines is here to help you navigate the way forward.