Gasoline Prices Seen Averaging $3.57 per gallon, Summer 2014

There are some new refineries being built in North Dakota
Refineries sprout in North Dakota, bucking the trend| Reuters

But these are being built because of the higher diesel demand in state, and the local oil. I doubt they would work economically if they didn't have access to cheaper oil than the other refineries.

Moving a refinery gets rid of the grandfathering, meaning that its not productive to move. The only way to stay grandfathered with the lower costs is to expand an existing refinery. You could expand the BP refinery more by chicago, but a big new refinery has not been built since the 70s. What most people don't seem to realize is phase 1-3a of keystone are already built and pumping oil. Its only phase 3b (just 47 mile spur in texas) and the controversial 4 (1176 miles from alberta through Montana and the its oil fields, the dakotas and nebraska) are still not built. From Steel City Nebraska to the gulf coast refineries has been completed except for that short 3b section. The 4 biggest gulf refineries each can process over 500 thousand barrels of oil a day. The only approval needed is alberta into alberta connection between countries.

Perhaps we need new regulation to allow new big oil refineries to be built, that are cleaner than the existing gulf coast ones, but don't have that huge burden of regulation that makes them too expensive to build.

 

Yes, it is somewhat ironic. I have heard that when/if the keystone is complete we will have less of a glut in the Midwest, thus increasing our gas costs.

 

Obama Administration Delays Keystone XL Pipeline Decision - US News

 

actually being a texan, I would say its a travesty that the last major refinery was completed in 1976 almost 40 years ago. These are three projects in North Dakota a tiny compared to the major refineries. They are spured by a poor pipeline system serving North Dakota, so it makes perfect sense. But if you are asking why not a major refinery, its environmental regulations.

Well then you agree. It makes no sense to say if you were built 38 years ago or more, you can pollute x amount, but if you build a new one its got to pollute so much less no one really wants to invest. Those North Dakota ones are so small they get to skirt some of the regulations. That's the kind of thinking that has kept texas city open so long. BP violated so many health and safety regulations that they killed people, but all the EPA could do is fine them a tiny bit. There just wasn't slack capacity. Thankfully Marathon bought it, and is running it more responsibly.

One branch + 47 on anouther in texas if the oil all starts flowing to be refined in the gulf state refineries.

Again no reason to move an ancient polluting refinery to canada, if it could handle the oil sands it would be profitable. No reason to move it in the US, it loses grandfathering. Its not the old equipeent that is worth money, its the looser environmental regulation granted it by being old. You still need to get the refined products out of alberta, to major markets in the US. That means, yep a pipeline. If you disaprove of an oil pipeline crossing the border, why would you agree to a gasoline or a diesel pipeline. No sense in that reasoning.

You are forgetting the gulf of mexico spill happened with existing drilling regulation being modified by MMS. This was a criminal act by MMS, BP, Haliburton, etc.

Getting a pipeline to the gulf coast reduces the demand for gulf oil. Gee, can you connect the dots.

Reducing regulation for new refineries to be profitable and cleaner than 38 yo refinereies may actually reduce pollution, but regulators love this grandfathered stuff. BP pays the regulators good money to keep new refineries from being built so its inefficient one in Illonois can turn a higher profit. The oil spill is a great reason to change these regulations, not double down on hoping that having 78 year old refineries 30 years from not are the lowest polluting.

Ofcourse the Canadians could build more. Here is an explanation on why they haven't done so from someone other than me.
Why Aren't We Building Refineries In Canada? Because It's Too Late, Experts Say

Which makes sense. If the US decides that it wants to keep using as much opec and, wants to limit transportation of canadian oil sands to train or truck, then its likely they will pipe it out and sell it to those asia refineries. It will cost the oil companies more, and more of the profits will be kept outside north america, but hey, at least billionaire Steyer will have proven that he can buy an issue. And they may be enough political muscle on the environmentalist side to turn the senate republican.
New Keystone XL Delay: 'A Stunning Act Of Political Cowardice' - Forbes

 

Seems the solution is to eliminate the grandfather clauses.

 

Its a little more complicated than that, but yes we should remove the incentives to expand old plants instead of build new ones where they are needed. One major problem has been the regulations are so heavy for a new plant that it simply is not economical, and can't compete with the old ones. There are 3 possible solutions for this ;-) We can subsidize new plants, fairly easily by collecting a fuel tax and and providing incentives to build in markets that this is needed. We can raise the rules on old plants, or we can lower the rules on new big refineries. I favor a combination of all three. Since a major refinery (over 100,000 bbl/day) hasn't started construction since 1976, although 1978 might be a better number, the first production of the last plant built that now has over 100,000 capacity in North Pole, AK. Garyville, La on the gulf coast was the last big complex refinery built in 1976 to 200,000 bbl/day, recently expanded to 522,000 bbl per day.

When was the last refinery built in the United States? - FAQ - U.S. Energy Information
Administration (EIA)

Putting the new ND possible plants in perspective one 13,000 bbl/day the other is 20,000 bbl/day the third hasn't gotten far enough on its paperwork for us to know the size, but these are simple small refineries, not needing much of the equipment of a coplex refinery. If the 3 all get built we are probably talking 53,000 bbl/day or less. That means garyville processes as much crude in 37 days as all three combined will produce in a year.

One problem is you can't remove grandfathering, without causing a shortage of refining capacity You can have it expire though, and excess capacity is finally being built.
U.S. Oil-Refineries Bulk Up - WSJ.com

This extra 400,000 capacity would have allowed the epa to close the bp texas city plant, without a major disruption in fuel. Which means we need one more thing. Regulators with teeth that can stop one of the few refiners from acting badly like bp has done especially in texas city.
The Explosion At Texas City - CBS News

 

The bakkan shale represents a good opportunity for these small simple refineries. They have very high grade low sulfur oil coming out at the well head so it doesn't need to be processed much, and a simple refinery will do. These simple refineries that simply mix fractions and remove a little sulfur, are less expensive to build. They are mainly going to produce diesel, which does not have good transportation routes into the shale areas like gasoline. The small simple refineries to avoid expensive transportation by the new fraking shale deposits make perfect sense, but they don't do much to solve some of the national refining problems.

They are not economical to upgrade with new tech, like the complex larger refineries. They won't be able to handle lower grades of crude. These upgraded refineries are all at least 37 years old. You need scale to economically add the equipment. The east coast refineries that closed did not want to invest in the equipment.

These do little to reduce refinery shocks. Yearly the California refineries which is now regulated to be a closed market cause shocks. The BP refinery in Ill is poorly maintained, and causes shocks in the summer for the chicago area. The country is now more dependent on gulf coast refineries, that caused a major shock from hurricane damage less than a decade ago. These few at bakkan shale don't produce enough to help if a major refinery goes down (the population of ND is about the same as the 5th largest city in texas), the scale is not there.

Again the east coast tailored to easy to refine oil, and that caused problems. You want major refineries in geographically diverse locations. The regulators and few refiners have concentrated the profitable refineries that can handle many types of oil on the gulf coast and mid west, leaving the west and east coast vulnerable to gulf hurricanes or problems from poorly maintained local refineries.

One good thing is we are building excess capacity, but it is concentrated.

 

The larger the refinery, more volume has its equipments, which helps efficiency...