The Keystone XL Pipeline (KXL) is a bet on much higher oil prices several years from now. It will take at least $85 oil prices to develop the new oil sand projects needed to fill the pipeline. It is also a bet that U.S. tight oil output will continue to grow and will need heavy oil to blend for refining. Both bets are risky. A Bet On Higher Oil Prices KXL would add about 830,000 barrels per day (b/d) to the 1.3 million b/d already moving through the base Keystone Pipeline system completed in 3 phases between 2010 and 2014 (Figure 1) when oil prices were more than $90 per barrel. (Click to enlarge) Figure 1. Location map of Keystone XL and Base Keystone pipeline systems. Source: TransCanada and Labyrinth Consulting Services, Inc. It was not until prices exceeded $70 per barrel in 2005 (December 2016 dollars) that oil […]