What would the Keystone XL pipeline do for the water technology sector?
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The construction of TransCanada’s Keystone XL pipeline is one of the issues that sharply divides the two U.S. presidential candidates, with Mitt Romney promising to restart the project on day one of his presidency, reversing Obama’s veto.
The issue should be much less divisive for water technology companies, as it brings greater sales opportunities at both ends of the pipe.
In the Alberta oil sands where the pipeline begins, greater exports of syn-crude to the U.S. would be expected to lead to increased demand for water recycling systems for in-situ operations. The SAGD (steam-assisted gravity drainage) systems used to steam out the bitumen beneath the ground require large quantities of high-quality steam, and with the amount of water that can be withdrawn from the Athabasca river capped out, increased production will feed through into demand for evaporators and related recycling systems.
At the other end of the pipe in Southeast Texas, the influx of syn-crude creates a different water challenge. Refining the syncrude will require water – and create a challenging wastewater stream. Last year’s drought in Texas has cast a shadow over long-term water availability for refineries in the state. It means that water efficiency will be paramount in any refinery expansions that may happen, and it may in the longer term lead to demand for seawater desal. From the wastewater perspective, syn-crude has a higher level of selenium in it than the crude oil now processed in Texas refineries, and the EPA has been tightening restrictions on selenium discharges in water. Selenium restrictions have already obliged coal-fired power stations to consider zero liquid discharge systems for wastewater. Will refineries be forced to follow suit?
One could argue that the election will be a win-win situation for water technology firms. If the Democrats win, water technology firms might win because of tighter environmental regulation. If the Republicans win, those firms might do well because of greater reliance on dirtier energy sources such as the oil sands and coal, which require more complex water treatment.