Archive | Oil and Gas Sector-Politics and Image

The crisis facing Canada’s oilpatch isn’t just the industry’s problem, it’s everybody’s problem – by Peter Tertzakian (Financial Post – March 27, 2020)

https://business.financialpost.com/

Sudden shocks to a system are never good. Things break under stress, sometimes permanently, sometimes with unforeseen consequences.

In the oil world, things could start breaking in a matter of weeks. Here in Canada the situation is likely to be acute, because of our concentrated exposure to one customer, the United States.

Oil markets worldwide are under extreme stress. First, there’s the price war waged by The Organization of the Petroleum Exporting Countries — a deluge of barrels thrown into markets opportunistically during the COVID-19 pandemic. Continue Reading →

Canadian heavy oil cheaper than a pint of beer as North American demand for fuel plummets – by Geoffrey Morgan (Financial Post – March 27, 2020)

https://business.financialpost.com/

CALGARY – As commuters stay home and lockdown orders spread across the U.S., the price of Canadian heavy oil has collapsed. Western Canadian Select heavy oil price benchmark fell 30.5 per cent on Thursday to US$6.45 per barrel, which analysts joke is less than a pint of beer. U.S. crude prices fell 7.7 per cent to US$22.60 per barrel.

“Prices are so low that there’s no point in transporting if you don’t have to. If you can move it into storage, you will,” said Stephanie Kainz, senior associate at RS Energy Group, a division of Austin, Tex.-based Enverus.

However, Canadian producers that are able to move their barrels directly to the U.S. Gulf Coast refineries through existing pipelines have been able to enjoy higher prices, of close to US$16 per barrel, as American refineries still want Canadian heavy oil, despite dwindling demand for fuel. Continue Reading →

‘Very, very frightening’: Calls for government bailout grow louder as oilpatch faces bleak outlook – by Geoffrey Morgan (Financial Post – March 24, 2020)

https://business.financialpost.com/

CALGARY – All of Canada’s largest oil companies are underwater at current oil prices, oilfield service providers are laying off staff as they struggle to pay their debts and a new report argues the industry “has never faced a greater threat to its existence than it does right now.”

With the price of Western Canada Select heavy oil trading at US$8.90 per barrel on Tuesday, oil producers such as Suncor Energy Inc. and oilfield services companies including Precision Drilling Corp. have started making additional deep spending cuts.

Precision also signalled new layoffs are coming as the industry tries to survive both a drop in global oil demand induced by the coronavirus pandemic and an oil price war. Continue Reading →

How COVID-19 is affecting the bottom line in Sask.’s biggest industries – by Chelsea Laskowski (CBC News Saskatchewan – March 17, 2020)

https://www.cbc.ca/news/canada/saskatchewan/

Saskatchewan’s biggest industries are forging ahead with limited impact in the face of COVID-19, but are paying keen attention to its long-term effects. Potash and uranium mines are taking precautions with staff, but spokespeople with Nutrien and Cameco, the biggest players in both industries in the province, say there have been no disruptions to production.

Spring seeding hasn’t started in agriculture yet, but there are long-term repercussions that could hit next month. In the short term, oil has been the hardest hit.

Oil

Oil prices plummeted early last week. There were other factors causing the dip that were unrelated to coronavirus, but as the disease has spread there are new major pressures on the industry. Continue Reading →

Wet’suwet’en Band Councils Still in the Dark on Deal with Hereditary Chiefs – by Jason Unrau (The Epoch Times – March 12, 2020)

https://www.theepochtimes.com/

More than a week after federal and provincial ministers made a deal with Wet’suwet’en hereditary chiefs protesting a natural gas pipeline, elected Wet’suwet’en leaders say they haven’t yet seen details of the deal, which will implement a 22-year-old Supreme Court of Canada decision over aboriginal rights and title in their region.

“We were excluded from the process,” said Wet’suwet’en First Nation Chief Maureen Luggi of the meetings held over three days between the hereditary chiefs and Indigenous-Crown Relations Minister Carolyn Bennett and her provincial B.C. counterpart Scott Fraser.

Luggi’s community is one of six Wet’suwet’en First Nations in northeastern British Columbia whose interests are entwined in both the landmark 1997 Delgamuukw decision and the Coastal GasLink pipeline, five of which have signed deals related to the $6.6 billion project. Continue Reading →

What just happened to your retirement savings? Blame coronavirus — and Donald Trump, too – by Heather Scoffield (Toronto Star – March 12, 2020)

https://www.thestar.com/

No basketball, no hockey, no baseball. And to top it off, no money — or at least, a lot less of it after Thursday for pretty anyone who has investments.

We thought the market carnage of Monday was bad, when stock prices took their biggest dive since the crash of October 1987. Thursday was worse: the Canadian dollar hit a four-year low, the Toronto Stock Exchange fell 12 per cent — its worst day since 1940 — and the price of oil dropped another six per cent.

Billions of dollars have evaporated in the blink of an eye — $830 billion in market value since the TSX peaked on Feb. 20 — zapping retirement savings and children’s education funds. Continue Reading →

Pro-development voices not heard as activists use protests to advance own agenda: Indigenous leaders – by Tyler Dawson (National Post – March 12, 2020)

https://nationalpost.com/

‘It’s very ironic that environmentalists are interfering in our business since they actually killed our way of life by stopping the fur trade’

EDMONTON — First Nations leaders who are pro-resource development say their voices are being drowned out by environmental activists who have co-opted a protest movement started by anti-pipeline hereditary chiefs. They’re also raising questions about who should speak for the Wet’suwet’en First Nation.

“We feel like we’ve been hijacked by the protesters who have their own agenda on this,” said Theresa Tait Day, whose hereditary name is Wi’haliy’te. “They’ve used our people to advance their agenda.”

Tait Day, president of a group called the Wet’suwet’en Matrilineal Coalition who was stripped of her title of hereditary chief after supporting the Coastal GasLink project, testified at a parliamentary committee in Ottawa on Tuesday. Continue Reading →

Between 30 and 70 per cent of Canadians could become infected with coronavirus, Patty Hajdu says – by Carly Weeks (Globe and Mail – March 11, 2020)

https://www.theglobeandmail.com/

Between 30 per cent and 70 per cent of Canadians could become infected with the new coronavirus that causes COVID-19, federal Health Minister Patty Hajdu said Wednesday, but that number will depend on the scope and scale of the response to combat transmission.

The COVID-19 outbreak is a “national emergency and crisis,” Ms. Hajdu told the House of Commons health committee, but public health officials say they won’t prohibit mass gatherings until the virus spreads more widely.

“There are a range of estimates, but I would say that it is safe to assume that it could be between 30 per cent of the population that acquire COVID-19 and 70 per cent of the population,” she said. Continue Reading →

For richer or poorer: coronavirus, cheap oil test climate vows – by Ross Kerber, Matthew Green and Simon Jessop (Reuters U.S. – March 12, 2020)

https://www.reuters.com/

BOSTON/LONDON (Reuters) – Climate change commitments by banks, pension funds and asset managers face their first major test as markets reel from the twin shocks of coronavirus and a sliding oil price.

The challenge looks formidable. When the 2008 financial crisis tipped the world into recession, carbon emissions fell. But as economies grew again, governments proved unable to halt an emissions rebound.

The issue now is that at a crucial moment for international negotiations, the latest global economic blow could put paid to costly ideas for slowing climate change from political leaders and the private sector alike. Continue Reading →

With Buffett’s exit, those behind the real energy blockade can claim success – by Rex Murphy (National Post – March 10, 2020)

https://nationalpost.com/

The rail blockades were but the freshest link in a long-forged chain intended to strangle Canada’s oil and gas industry

What is the lifespan of a political promise? Somewhere between that of a mayfly and the length of a fog-free interval in Placentia Bay (the latter purely an imaginary construct. P.B. is never fog-free).

A political promise is extremely fragile and highly unstable, however buttressed by invocations of the highest integrity and truth in the moment it is being made. Within the flit of that mayfly’s evanescent wings, it is discarded and gone, as the politician’s whim directs him.

We normally don’t receive these promises with “a grain of salt.” We call in the winter salt truck and dump the whole load on whatever pledge or promise a mayor, premier or PM has offered as a given day’s electoral bait. We laugh at political promises — “political promise” is one of those joke oxymorons like “giant shrimp” or a “green economy.” Continue Reading →

Warren Buffett’s exit from $9-billion Quebec LNG project after rail blockades ‘a signal’ to investors – by Geoffrey Morgan (Financial Post – March 10, 2020)

https://business.financialpost.com/

Warren Buffett, one of the world’s most influential investors, has pulled out of a proposed $9 billion liquefied natural gas project in Quebec over concerns about railway blockades and infrastructure challenges.

The domestic oil and gas sector was already reeling after Teck Resources cancelled its $20.6 billion Frontier oilsands project in Alberta last month, partly over fears about rail blockades, and as other strategic investors have avoided the industry.

“Over the last month, a clear signal has been sent to businesses across Canada that the rule of law will not be upheld and that major projects cannot get built,” Conservative MP for Chicoutimi-Le Fjord Richard Martel said in an email, adding that Quebecers “risk losing out” on a multi-billion project. Continue Reading →

Energy sector ravaged as TSX plunges 10.3 per cent amid global oil price war – by Geoff Zochodne (National Post – March 10, 2020)

https://nationalpost.com/

The loss of more than 1,660 points is the biggest single-day decline since 1987

Canadian stocks took a historic hammering Monday after global crude prices collapsed and the spread of the new coronavirus continued to threaten the global economy.

The S&P/TSX Composite Index lost about 10.3 per cent of its value, or more than 1,660 points, in what was the biggest single-day decline since 1987. Canada’s main stock index finished Monday at 14,514.24, a 14-month low.

The suddenness with which stocks fell to start the trading day even triggered so-called circuit breakers, which briefly halted trading on the TSX. In the end, the only stock in the S&P/TSX index that finished Monday in the green was Dollarama Inc., the Montreal-based discount retailer. Continue Reading →

The divine right of hereditary chiefs to override the desires and needs of their people – by Lawrence Solomon (Financial Post – March 7, 2020)

https://business.financialpost.com/

The hereditary chiefs are in the pockets of anti-pipeline U.S. Tides Foundation, which funds their activities, and others in the well-heeled environmental lobby

Who are these hereditary chiefs of the Wet’suwet’en Nations who are stopping the Coastal GasLink pipeline in northern British Columbia? And who gave these chiefs the right to high-handedly override the desires of the native Canadians over whom they claim dominion?

Like the paternalistic rulers of Western nations of old who claimed to rule by divine right — France’s Louis XVI and Russia’s Tsar Nicholas II were their countries’ last specimens — the hereditary chiefs of the Wet’suwet’en Nations are unaccountable anachronisms divorced from the needs of their people.

The desire for development by Canada’s Wet’suwet’en natives could not be more evident. All five Wet’suwet’en bands along the Coastal GasLink pipeline route endorse the project for its economic and social benefits, as seen in public opinion and the votes of all five of their band councils. Continue Reading →

Canada’s petrochemical industry warns Ottawa against single-use plastics ban – by Kathryn Blaze Baum and Emma Graney (Globe and Mail – March 9, 2020)

https://www.theglobeandmail.com/

“The International Energy Agency predicts that by 2050, global
oil demand for plastic production will surpass oil demand for
road passenger transport. The Alberta government is not oblivious
to this shift. A major aspect of the province’s effort to diversify
the economy away from energy exports is to satisfy the growing desire
for petrochemical products.”

Major petrochemical companies operating in Canada oppose a looming federal ban on single-use plastics and believe product demand should be market-driven, not prescribed by government regulations.

Dow Inc. and Nova Chemicals Corp. said that while they support efforts to reduce plastic waste, they believe bans can lead to an increase in alternatives that are worse for the environment and generate more greenhouse gas emissions. The companies are two of Canada’s largest petrochemical players involved in the production of plastics, with facilities in Alberta and Ontario.

“Bans are limited in their effect because they do not address human behaviour related to waste management or significantly reduce the amount of debris that ends up in the environment,” Dow spokeswoman Adrianne Lovric said. Continue Reading →

OPINION: Saudi Arabia-Russia price war sends oil crashing, spooks equity markets – by Eric Reguly (Globe and Mail – March 9, 2020)

https://www.theglobeandmail.com/

Only a few days ago, Saudi Arabia was pushing for a production cut among its oil-producing allies, including Russia. On Sunday, the kingdom did exactly the opposite and opened the spigots, sending prices down more than 30 per cent, the greatest loss since the start of the 1991 Gulf war.

The sudden reversal shocked the energy, equity and bond markets around the world. Saudi Arabia has in effect declared war on oil powerhouses Russia and the United States. Why the sudden reversal?

The U-turn hammered oil, which was already losing value at a rapid rate as COVID-19 swept across the planet. In early European trading, the price of Brent crude, the international benchmark, fell below US$32 a barrel before recovering somewhat to US$36, down 20 per cent since Friday. In early January, Brent was trading north of US$65. Continue Reading →