Crude Oil Pipeline Project Spending Ballooned in 2017, Especially in Texas
Since crude oil prices tanked four years ago, the oil pipeline industry has seen many setbacks and slowdowns. Permitting woes, public resistance and narrow profit margins - both upstream and downstream pipeline companies - have made new crude oil pipelines seem like increasingly risky propositions. As such, Industrial Info saw very low growth in crude oil pipelines in North America during 2015 and 2016.
However, as prices increased in 2016, bringing production rates along with them, new pipeline capacity has become necessary, leading to a ballooning of project spending in crude oil pipelines in 2017. This spending has been largely centered in Texas, a change from the previous leader, Western Canada.
In 2014, there was a boom in spending on crude oil pipelines. Industrial Info added more than 330 project profiles, representing over $30 billion in spending. Most of this spending was dominated by mega projects in Alberta and Saskatchewan, with Texas representing only $2.5 billion. In stark contrast, 2016 was the slowest year in recent times, with only 35 new projects valued at just over $1.6 billion. However, Texas started to assert itself and had more than $800 million in spending, or fully half of the value of all the new projects added that year. In 2017, new pipeline investments in Texas grew to $4.7 billion, or two-thirds of the North American total of $6.6 billion.
Only three months into 2018, Industrial Info has added almost half a billion dollars in crude oil pipeline projects. Half of this spending is in Texas, and Industrial Info is finding more projects day by day.
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