|Oil and gas has to move - from the wellhead to its final destination - and a more robust and up-to-date pipeline infrastructure would make the transportation of products more efficient. (Photo source: Depositphotos.com)|
We all know that better pipeline infrastructure will reduce oil and gas transportation costs and improve safety, but do we know why?
Charles Hughes, U.S. News, says:
"The domestic energy production landscape has changed markedly in recent years. America surpassed Russia to become the world's top producer of natural gas in 2009. The Environmental Information Agency recently announced that U.S. exports of crude oil and petroleum products have more than doubled since 2010. Despite such increases in domestic production, the development of transportation energy infrastructure has not kept pace. Oil and gas need to travel from the wellhead to their final destination, whether that is storage or processing plant, or customers at the end of the chain.
A more robust pipeline infrastructure would make transportation of oil, natural gas and their products more efficient by reducing transportation costs and offering a more reliable mode of transportation. A well-developed energy transportation network would also reduce regional price differences."
When pipeline infrastructure is in ill-repair and insufficient to meet the needs of a developing oil and gas development, costs go up, safety becomes a concern and producers are likely to turn alternative transporation modes.
Hughes says, "From 2007 to 2016, per billion ton-miles of oil and gas products transported, there were 0.66 incidents for oil pipelines (i.e., the fewest accidents), 0.73 for natural gas pipelines, 2.20 for rail and 7.11 for road."