(by Paul Vivian and Rick Preckel, www.prestonpipe.com) Market Monitor – Last week a third carbon dioxide pipeline project was announced by Wolf Carbon Solutions for the US farm belt. The latest is a proposed 350-mile pipeline to transport carbon dioxide from ADM’s ethanol plants in eastern Iowa for injection in central Illinois. The pipline would have a capacity of 12 million tonnes/year allowing it to service other potential customers in the region. The other two proposed systems for the region are from Navigator and Summit Carbon Solutions. The Navigator system architects are planning to inject near the Wolf Carbon Solutions injection location and the Summit group is targeting injection in North Dakota. Activity in carbon capture has ramped up as tax credits have become more generous. It has been about 4 months since we finalized the work on our line pipe forecast for our OCTG & Line Pipe Forecast Summit held last October. Unfortunately, the market continues to languish. According to the EIA, there are 2,739 miles of gas projects that are in various stages of the approval process. One, to service the Alaska Nikiski LNG project, which represents about 800 miles of pipeline, continues to move forward as indicated in a December 2021 presentation on the Alaska LNG website. Beyond that, there are 7 more projects that amount to 1,237 miles of pipelines and an additional 31 projects, some of which do not involve pipelines, that make up the additional 700 miles. These projects are planned for completion through 2025 in some cases. This is just about a million tons of pipe depending on your assumptions on OD. On the liquids side, there are about 2,257 miles of pipeline in various stages of the approval process that represent about 750,000 tons of pipe. In both the liquids and gas pipeline cases, there is no doubt that some of this will not be built and some additional lines will be built. A poor year, in recent history, for large diameter pipeline construction, has been anything under 2.0 million tons. Last year was a record low at 600k and the outlook, as laid out above, is 1.75 million tons spread over the next several years. Import Supply – The November import total was 70,522 tons which was just over 25% above the license tally from last month. December import licenses show a further increase in volume to 84,877 tons. The January forecast, with 11 of 21 days summed, is steady at 83,271 tons. The top import item for the month of November 2021 was carbon ERW, from 4 ½” through 16” OD, at 27,999 tons. The price was $1,446/ton. This is up $142/ton and $448/ton respectively, over last month and the last three months.
Preston Pipe Report – Jan 2022
Pipe Exchange
14025 West Road
Suite 100
Houston, TX 77041
- Phone: 713.934.9480
- Fax: 713.934.9490
- Email: sales@pipexch.com