Archive | Canadian Media Resource Articles

Changing potash landscape a boon for China, India – by Brenda Bouw (Globe and Mail – August 1, 2013)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

China and India are poised to gain greater control over global potash pricing now that the oligopoly that controlled the majority of trade in the crop fertilizer, a key Canadian export, has been dismantled.

This week’s breakup of Belarus Potash Co. (BPC), a joint venture between Russia’s Uralkali and Belaruss’s Belaruskali, puts the world’s two most populous countries in a much stronger position after years of resistance to prices set by both BPC and Canada’s Canpotex Ltd.

Until now, the two groups controlled more than two-thirds of global potash sales. Saskatoon-based Canpotex is owned by Potash Corp. of Saskatchewan, Agrium Inc. and Mosaic Co.

The new landscape is expected to lower potash prices, which would increase demand and crop yields, particularly in high-demand countries such as China, India and Brazil. That in turn could help contribute to lower global food prices, which economists say are falling on expanded crop planting. Continue Reading →

Down with [potash] cartels, comrade – by William Watson (National Post – August 1, 2013)

The National Post is Canada’s second largest national paper.

The hungry of the world, who clearly would benefit from a 25% lower price of a key fertilizer, shouldn’t count their cheaper meals before they’re grown

Belarus’s President Alexander Lukashenko, Europe’s last remaining dictator, seems an unlikely devotee of Adam Smith. Yet his Decree Number 566 last December — decrees are a large part of his leadership style — is what so annoyed his Russian partners in the Eurasian half of the world potash cartel that they announced Tuesday they would be letting their exports rip, as they claim the Belarussians have already done in sales to China and India.

The other third of this Putin-Lukashenko troika is, ahem, us. We run the North American half of the cartel through Canpotex, the Saskatchewan potash export consortium formed in 1972, just about the time in fact that we were also putting together domestic cartels over milk, cheese, eggs and poultry. Trudeau times, recall, were managed-economy times.

The consensus view seems to be that this jolt of Smithian competition into the long-cartelized world market will bring potash prices down from above US$400/tonne to something more like US$300. Continue Reading →

Major new oil pipeline to Eastern Canada to get the go-ahead – by Shawn McCarthy and Jane Taber (Globe and Mail – August 1, 2013)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

OTTAWA AND HALIFAX — TransCanada Corp. is expected to announce Thursday that it will push ahead with a major oil pipeline linking Western Canada with refineries and export terminals in the east, marking a significant step forward for Canada’s goal to tap new export markets.

The Energy East pipeline would deliver some 850,000 barrels of crude a day from Western Canada to Quebec and New Brunswick, serving the three refineries in the two provinces. The project – labelled a “nation builder” by New Brunswick Premier David Alward – has been endorsed by provincial and federal politicians, though Quebec Premier Pauline Marois said last week her province would have to study the proposal once TransCanada releases its detailed plans.

The planned pipeline is a strategic bid to open up new export opportunities for Canadian energy producers eager to diversify their markets beyond the oil-glutted U.S. Midwest. Alberta oil production is surging, but the province faces serious hurdles with other projects aimed at expanding crude-export capacity. Continue Reading →

Oil sands crisis strategy a work in progress – by Claudia Cattaneo (National Post – August 1, 2013)

The National Post is Canada’s second largest national paper.

More than two months after bitumen mixed with water started seeping from its Primrose oil sands project, Canadian Natural Resources Ltd. mobilized Wednesday to deal with the real out-of-control gusher — misinformation.

After saying little publicly about the incident, involving seepages that started on May 20, Canadian Natural issued an early morning news release, held an analyst call and then interviews with the media to confirm the leaks have been contained and the spill is being cleaned up.

No one got hurt, the company said, but 16 birds, seven small mammals and 38 amphibians were killed and that two beavers, two birds and two muskrats are being cared for prior to being returned to their natural environment. So far, 6,300 barrels of bitumen emulsion have been collected, while seepage from four locations has declined to fewer than 20 barrels per day.

Meanwhile, the company cut its forecast for 2014 production from the project to 100,000-110,000 barrels per day, about 10,000 b/d lower than targeted. Continue Reading →

Steelworkers pledge to fight for mine safety inquest (CBC News Sudbury – July 31, 2013)

Mining deaths are preventable, USW spokesperson says

The United Steelworkers Union says the premier has rejected its request for an inquiry into mine safety. The union started to push for an inquiry into mine safety after the deaths of two men at Vale’s Stobie mine in Sudbury in 2011, but the Ministry of Labour said it has already taken many steps to improve mine safety in the province.

Minister Yasir Naqvi said a council was struck in 2010 to make proactive suggestions on workplace safety — and one of its members is a mining subcontractor. “We should not be getting involved and engaged only after an unfortunate incident takes place,” he said.

“We need to make sure we are at the front end, making sure all the precautions are taking place, and everybody is trained.” As for safety measures, Naqvi pointed to the introduction of six new mining regulations in the past 10 years.

And there have been 10 mining safety blitzes since 2008, he said. Continue Reading →

Miners worry about environmental survey (CBC News Thunder Bay – July 31, 2013)

Mining industry stakeholders concerned the Lake Superior Binational Forum survey could hinder their plans

A group interested in preventing pollution in Lake Superior is asking the public what it thinks about mining activities — and some supporters of a proposed new mine in the area are worried about the impact the results of that survey might have.

Sponsored by the Lake Superior Binational Forum, the survey asks respondents to think about the environmental impact of mining activity around the lake. CBC News obtained an e-mail exchange among mining industry stakeholders that showed there is concern the survey could hinder their plans.

“Can you blast a new email out to your network, asking anyone with an interest in mining to complete the survey so that a balanced result occurs?” the email said. “We are reasonably certain this is a move by the bi-national forum to enter the results against Stillwater’s project in the panel proceedings this fall, in an overall effort to kill mining around Lake Superior.”

The general manager of a mining company with plans to build a mine north of Marathon, said he filled out the questionnaire because he wants the results to be balanced. Continue Reading →

Russia’s potash breakup a ‘game-changer’ for Canadian industry – by Brenda Bouw (Globe and Mail – July 31, 2013)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

The dramatic breakup of the world’s largest potash oligopoly promises to reshape the industry and send prices tumbling, threatening the profit-making power of the marketing group that sells Saskatchewan potash to global customers.

Russia’s Uralkali said it is walking away from its Belarus Potash Company (BPC) joint venture with partner Belaruskali in order to sell potash on its own to hungry markets in China and India. The move is expected to shatter the industry’s supply-demand picture and spur a global potash price war.

It’s also a serious blow for Canpotex Ltd., the potash marketing group made up of Potash Corp. of Saskatchewan Inc., Mosaic Co. and Agrium Inc. The shares of all three companies were hit hard; combined, they lost nearly $9-billion in stock-market value. Potash Corp., one of Canada’s biggest mining companies, fell 16 per cent to $32.66. Analysts warn Canpotex’s pricing leverage could soon disappear, clobbering profits for each public company.

“This is a game-changer,” said John Chu, an analyst at Alta-Corp. Capital Inc. Continue Reading →

English hamlet becomes unlikely hub for global fracking debate – by Paul Waldie (Globe and Mail – July 31, 2013)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

BALCOMBE, ENGLAND — With its million-pound homes and leafy estates, the village of Balcombe hardly looks like a hotbed of environmental activism. But this community of fewer than 2,000 has suddenly become the latest epicentre of the global debate over fracking.

For the past week, Balcombe villagers have been waging war with Cuadrilla Resources Ltd., Britain’s largest shale player, which is about to start test drilling in the area, hoping to extract oil from shale rock. Houses have been plastered with “Frack Off” signs, and dozens of people have lined the gates to the site, chanting, singing and trying to stop trucks from going in. Nearly two dozen people have been arrested.

The “Battle for Balcombe” has become a rallying cry for opponents of fracking everywhere as activists, celebrities and media have descended on the village, a short train ride south of London. Arrivals of serial, experienced veterans of the G20 demonstrations and the Occupy camp outside St. Paul’s have turned this town into an eco-cause celebre. Continue Reading →

Canadian mining industry embraces transparency initiative – by Drew Hasselback (National Post – July31, 2013)

The National Post is Canada’s second largest national paper.

A new form of transparency is coming to the Canadian mining industry, and it will be compulsory. The industry is offering broad support to an initiative called Publish What You Pay, and it’s bound to become mandatory now that Prime Minister Stephen Harper has stated that Canada will align its mining rules with similar transparency initiatives that have been passed in the United States and the European Union.

The concept is simple. Canadian companies will be required to disclose the amounts resource companies pay to any level of government, anywhere in the world. Industry broadly supports the idea in the hope that it will level the playing field in dealing with different governments around the world. There’s also a belief that transparency will reduce or eliminate opportunities for corruption, and enable local communities to see whether mining is benefiting them.

“What the Canadian government is attempting to do is encourage good disclosure globally of what is paid to governments,” says Sander Grieve, head of the mining practice at Bennett Jones LLP in Toronto.

“The driving theory behind it is to ensure that where ever you have material expenditures, there’s transparency so citizens can see where this money is going,” adds Sarah Powell, a partner with Davies Ward Phillips & Vineberg LLP in Toronto. Continue Reading →

Will three be the charm? Quebec makes third attempt to amend mining law – by Drew Hasselback (National Post – July 31, 2013)

The National Post is Canada’s second largest national paper.

This fall, Quebec’s legislature will consider several proposed amendments to the province’s Mining Act. The question is whether these changes will permanently impact the province’s reputation as a mining friendly jurisdiction.

That stature is already wavering. Each year the Fraser Institute ranks global mining jurisdictions based on their friendliness to investors. This year the province ranked 11th — a fairly strong showing, given that the 2013 survey covers 96 jurisdictions. But for the first time in years, the province didn’t make the top 10. Back in 2010 and 2009, it was even in first place.

“La Belle Province is no longer the belle of the ball it once was among mining jurisdictions,” says Tom Provost, a lawyer in the Montreal office of McMillan LLP.

“Even if it’s trying to do the right thing, the government is unfortunately sending mixed signals about whether Quebec is a mining friendly jurisdiction,” adds Frank Mariage, a lawyer in the Montreal office of Fasken Martineau DuMoulin LLP. “Quebec’s ranking on the Fraser Institute list of mining friendly jurisdictions has gone down.” Continue Reading →

Saskatchewan economy can weather potash storm – by Claudia Cattaneo (National Post – July 31, 2013)

The National Post is Canada’s second largest national paper.

CALGARY – Saskatchewan will feel the impact of a global potash price war triggered by Russia, but the blow will be lessened by industry efficiencies and continuing growth in other sectors such as oil and uranium. “We remain extraordinarily bullish,” Kent Windsor-Smith, executive director of the Greater Saskatoon Chamber of Commerce, said Tuesday.

“We don’t foresee anything slowing us in 2013. We are expecting to see a modest slowdown in the growth rate in 2014, but that was probably in the cards already and it related to the fact that a number of these capital projects are winding down and moving toward completion.”

Saskatchewan’s potash sector, which produces about a third of the world’s supply of the crop nutrient, spent heavily in recent years to modernize operations and reduce costs, making it well-positioned to weather pricing pressures, he said, while “producers in other parts of the planet may not be as cost competitive.”

Meanwhile, the province’s diversified economy, which has been growing at a blistering pace, will continue to be supported by spending in oil and uranium, and a stable agriculture base. Continue Reading →

‘The end of the potash world as we know it’ is no exaggeration – by Peter Koven (National Post – July 31, 2013)

The National Post is Canada’s second largest national paper.

For the potash industry, this would change everything.

If Russian producer OAO Uralkali follows through on its plan to max out production and collapse one of the sector’s two trading arms, the industry’s oligopoly-like business model is thrown out the window.

The days in which the potash producers withheld production to maintain pricing influence could break down completely. Instead, experts said the stage would be set for a dramatic battle for market share, with the companies running at much higher production capacity and selling far more product. Higher supply would mean lower prices, greater competition and a culling of higher-cost producers and eager new entrants.

In short, the potash business would start to resemble a normal commodity business. BMO analyst Joel Jackson called it “the end of the potash world as we know it,” which is no exaggeration.

Markets were rattled at that prospect. Shares of every potash producer in the world plunged on Tuesday as investors absorbed the idea of global prices falling by US$100 a tonne or more. Continue Reading →

New Prosperity will strengthen Williams Lake’s economy – by Kerry Cook (Vancouver Sun – July 29, 2013)

Kerry Cook is mayor of Williams Lake.

We are in the midst of a 30-day environmental assessment review panel hearing for the New Prosperity project, a copper and gold mine proposed by Taseko. This hearing will help the federal government determine the future fate of the project.

As local government we have a duty to seriously consider economic opportunities put before us. For us, New Prosperity presents an opportunity to strengthen the economic base of our region, provide new jobs and training opportunities.

The job potential is significant. Over the life of the New Prosperity mine, there will be 500 direct and 1,280 indirect jobs each year. We understand many industries are facing skill shortages. Taseko, however, has 1,400 active resumés on file. Now is the time to approve and build this project, which has the potential to expand our population base or offset downsizing in other sectors.

New workers will relocate here. This creates potentially hundreds of thousands of dollars in new wages, which will go into our local community each week, benefiting new and existing businesses. New Prosperity will also grow the local tax base, which in turn will support the development of amenities, along with recreation, education and health facilities. Continue Reading →

Do we really need Keystone? As Obama dithers, Canada moves on other options – by Claudia Cattaneo (National Post – July 30, 2013)

The National Post is Canada’s second largest national paper.

President Obama’s latest smug comments on the Keystone XL oil sands pipeline suggest the Canadian project’s odds of being approved under his watch are waning.

Thankfully, Canada hasn’t stood still while the U.S. President dithered. So many new pipeline options have emerged that Keystone XL’s relevance is diminishing as each one gains momentum.

Sure, it will be hard to fill Keystone XL’s void and promise over the short term — perhaps a couple of years around 2016 and 2017 until new pipeline options are up and running.

But over the long-term, Canada is better off fast-tracking oil market diversification to global markets that are not beholden to U.S. anti-oil interests and that remain very motivated to buy Canadian supplies.

Two all-Canadian options — TransCanada’s Energy East project from Alberta to New Brunswick, and pipelines from Alberta to the West Coast — made big leaps forward in the past few days. Continue Reading →

Oilsands expansion raises red flags for regulators – by Gilliam Steward (Toronto Star – July 30, 2013)

The Toronto Star has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.

Regulators increasingly want governments to take more responsibility for oilsands projects and their consequences.

The proposed west-east oil pipeline is inching closer to reality. Last week the premiers discussed the feasibility of such a huge project at their annual get-together. And TransCanada Energy confirmed that it has already signed up major producers who want bitumen from the Alberta oilsands delivered to refineries as far afield as New Brunswick and possibly for export.

Meanwhile in Alberta, for the first time regulators have raised alarming red flags about the environmental impact of oilsands expansion and urged the federal and Alberta governments to step up their oversight of these enormous operations.

The strong words of warning came in a decision by a joint federal/provincial panel established to review an application by Shell Canada for expansion of its Jackpine bitumen mining operation about 70 kilometres north of Fort McMurray.

The proposal would increase production by a third to 300,000 barrels a day; tarry oil that needs the increased pipeline capacity that an east-west pipeline would provide if it is to reach refineries. Continue Reading →