HOUSTON, May 15 (Reuters) - NuStar Energy LP has shelved a proposal to use new and existing pipelines to move crude oil from the Niobrara shale oil play in Colorado to Texas for lack of shipper interest, a spokesman said on Wednesday.
NuStar first gauged shipper interest in October last year and twice extended the open season. Executives told analysts in February that Niobrara production had not caught up with what the company would need to justify reversing two refined products pipelines and converting them to crude service.
"We think the open season process was worthwhile because we made contact with a few producers in the region that expect to increase their production in the Niobrara in the next couple of years and might have an interest in utilizing some of our pipelines in the region," Matula said.
Last November OKEOK Partners LP canceled plans to build a 200,000 barrel-per-day pipeline to carry crude from North Dakota's productive Bakken shale oil play to the U.S. crude futures hub in Cushing, Oklahoma, also because of a lack of long-term shipper commitments.
Refiners on the East and West coasts have instead ramped up shipments of Bakken crude via rail and barge, and Bakken crude travels to the Gulf Coast via barge as well.