Oil and Gas Sector-Politics and Image

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

Middle East will go back to being an obscure backwater
 
Today, the Middle East is in the news daily — we hear of strife in Syria, in Iran, in Israel and Palestine. Ten or 20 years from now, conflicts in the Middle East will count for less in the world’s scheme of things, just as the daily conflicts that now occur in Africa get short shrift, despite Africa’s far greater loss of life. Twenty years from now, the Middle East could be about as important as it was at the turn of the previous century — before its oil was discovered — which was not very important at all.
 
The Middle East will attract scant attention in future, not because the region will have run out of oil — it will have found much more — but because the rest of the world will also be awash in oil. As supplies increase, oil depreciates in price, as does the political value of its purveyors.
 
To see the future of oil, consider the present of natural gas. Until recently, many thought the West was running out of gas — most of the easily accessible natural gas finds were being depleted, making the West reliant on ever more distant, ever more difficult reserves to exploit. The U.S., the world’s biggest natural gas importer, began to build ports to receive liquefied natural gas from distant continents in the expectation that it couldn’t import enough from Canada and Mexico.

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

Ottawa’s decision to bring in a “one project, one review” regulatory process for major energy projects doesn’t sit well with environmental groups or First Nations, but it’s the right way to go.  In fact, if there is a concern, it’s that it took too long to reform an unwieldy system that is benefiting no one – except those feeding off its paralysis.

Anyone who has sat through public hearings into high-profile projects knows issues, concerns and suggestions become repetitive within days. And yet a regulatory review of the Mackenzie gas pipeline took six years, while the panel now reviewing the Northern Gateway pipeline is patiently hearing from an unprecedented 4,000-plus people.

In its budget Thursday, the federal government said it plans to introduce legislation to impose a maximum 24-month limit for reviews, cap hearings by the National Energy Board at 18 months and standard environmental assessments at no more than 12 months.

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

Chinese companies should be banned from construction work in Canada because of their questionable track record here and around the world. It was shocking that Enbridge Inc.’s Pat Daniel said his company was willing to allow a Chinese company to buy a stake in and to bid for the construction of the proposed Northern Gateway oil sands pipeline.
 
Not only should Chinese companies be banned from construction or bidding but Investment Canada should ban them from buying resource companies or related assets.
 
China’s strategy is to buy resources around the world, then low-ball to get construction contracts by using Chinese laborers and materials. This is not only damaging to the domestic economy, and unnecessary, but in some cases laws and obligations have been flouted. Just for the record, my husband heads Canada’s largest infrastructure and construction public company in Canada.

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

If it feels like new oil sands pipeline plans are being pitched with a sense of urgency, it’s because they are.
 
There are two primary reasons. With the northern portion of the proposed Keystone XL and Northern Gateway stuck in controversy due to environmental and First Nations opposition, and pipeline capacity out of Alberta expected to fill up in three years, oil companies are putting pressure on pipeline operators to come up with new options so production from places like the oil sands is not stranded or heavily discounted.
 
And, as tough as it is to get these projects off the ground, what’s also unfolding is a battle between pipeline companies as North American oil production rebounds.
 
The flurry of moves and counter-moves shows there’s a battle “between a couple of very large gladiators for market share in the oil transportation market in North America,” said Mike Tims, chairman of the Calgary-based investment dealer, Peters & Co., referring to Enbridge Inc. and TransCanada Corp.

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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.

CALGARY— For Alberta’s energy industry, Enbridge Inc.’s (ENB-T38.520.060.16%) plan to build a pair of major pipelines through the heart of North America promises to help break an export logjam that has severely discounted the value of crude surging from the oil sands.

At a cost of $3.8-billion, the Enbridge new pipes won’t be cheap. But for Canadian oil producers, that amount pales in comparison with what they are losing – by one estimate, $18-billion a year – as an export bottleneck weighs on prices for Canadian oil.

A shortage of capacity for moving oil out of the oil sands has stirred a broad rush to build new pipelines to all points of the continent – Kitimat, B.C., Quebec City, Houston.

The battle to build new pipes comes as energy companies seek to gain back some ground, after more than a year of “taking the short end of the stick … simply because we can’t move product,” said Lowell Jackson, chief executive officer of WestFire Energy Ltd. and chairman of the Canadian Association of Petroleum Producers.

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

What has the NDP wrought with the election of Thomas Mulcair as the party’s new leader? There was likely great wailing and gnashing of teeth among Bloquistes on his elevation, so we can assume that this is good news for the re-election of federalists in Quebec.
 
But what of the rest of the country? An article Mr. Mulcair wrote for Policy Option magazine, entitled Tar Sands: Dirty Oil and the Future of the Country, suggests that the new NDP leader is an irresistible force about to crash into the immovable object of Western public opinion. And there will be blood.
 
In his inaugural press conference as leader on Sunday, Mr. Mulcair softened his language — referring to the “oil sands,” rather than the pejorative “tar sands” that has been his normal shorthand. But did not back away from his commitment to “internalize” environmental costs to help cure the “Dutch disease” that has, in his view, driven up the value of the Canadian dollar and destabilized the balanced economy of East and West.

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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 U.S. Environmental Protection Agency calls the Honda Civic GX the world’s cleanest internal combustion vehicle. How clean? By EPA analysis, it reduces nitrogen oxide emissions by 35 per cent, hydrocarbon emissions by 50 per cent and particulate matter emissions by 95 per cent. For all practical purposes, it’s a zero-emissions car.

Yet, the Honda GX is neither manufactured nor sold in Canada. It’s made and sold only in the United States – where it exceeds the stringent pure-air standards of the famously tough California Air Resources Board and qualifies for carpool lanes that are open only to the cleanest of vehicles.

The Honda GX runs on compressed natural gas, the only alternative fuel so cheap that it doesn’t need government subsidies. Now sold in 197 dealerships in 36 states, it’s an assembly-line family car, the first mass-produced CNG vehicle. It lists at $26,000 (U.S.) and gets good mileage: 30 miles per (U.S.) gallon in city driving, 42 miles per gallon in highway driving.

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

Cynical as it may appear (and undoubtedly is), you can see why President Barack Obama’s decision to embrace the southern leg of TransCanada’s Keystone XL pipeline project – suddenly announcing on Thursday that he would fast-track approvals – sounded like a great idea within the White House.

You can also understand why his environmental “supporters” are spitting bullets. (I put “supporters” in quotes because environmentalists, like unions, only support you as long as you do exactly what they want.) And why they’re being joined by their arch-rivals in Big Oil.

In a way, it’s a great bit of politics. You have to admire the architecture, even if you don’t like the result (which almost no one appears to). It gives Mr. Obama a comeback for accusations hurled at him from all the various camps. And it traps the critics in their own positions.

The background goes like this: TransCanada Corp. wants to build a pipeline from the oil sands in Alberta that will carry crude to the Gulf Coast.

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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.

CALGARY, OTTAWA— TransCanada Corp. is proposing a major shift in the way oil moves across Canada, urging the oil patch to consider a massive $5.6-billion new pipeline system that would carry large volumes of western crude to refineries in Ontario, Quebec and beyond.

The East Coast Pipeline Project, as TransCanada has dubbed it in presentations to energy companies, could do more than supply the east with fuels made from oil sands crude. It could serve as an alternative to Northern Gateway, the controversial West Coast export pipeline project from TransCanada competitor Enbridge Inc. that has faced a wall of opposition from first nations and environmental groups.

The TransCanada proposal would send 625,000 barrels a day across the country to Montreal, Quebec City and potentially Saint John, N.B., where Irving Oil Ltd. runs a large refinery. Tanker exports could then also take the crude to Europe or Asia.

The proposal is conceptual, and the company has not disclosed public details about a project that may never be built.

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http://www2.macleans.ca/

Suddenly Western money and influence are driving everything that happens in the nation’s capital

In July 2006 Stephen Harper had been Prime Minister for half a year and it was time to deliver his first speech to a foreign business audience. He picked a friendly crowd, the Canada-U.K. Chamber of Commerce in London. He told them British investors were taking notice of “Canada’s emergence as a global energy powerhouse—the emerging ‘energy superpower’ our government intends to build.”
 
Canada, he said, was the world’s fifth-largest energy producer, ranking third in gas production and seventh in oil production. Canada was the world’s largest supplier of hydroelectric power and uranium. “But that’s just the beginning.”
 
There was “an ocean of oil-soaked sand” in northern Alberta, more than in any country except Saudi Arabia. Getting it out would be “an enterprise of epic proportions, akin to the building of the pyramids or China’s Great Wall. Only bigger.”

Fast forward to late last year. The future Harper described in London had become a reality. The oil sands were producing so much oil that the biggest challenge was simply to get the stuff to market.

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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.

Nouriel Roubini is chairman of Roubini Global Economics, professor of economics at the Stern School of Business, New York University, and co-author of the book Crisis Economics.

Today’s fragile global economy faces many risks: the risk of another flare-up of the eurozone crisis; the risk of a worse-than-expected slowdown in China; and the risk that economic recovery in the United States will fizzle. But no risk is more serious than that posed by a further spike in oil prices.
 
The price of a barrel of Brent crude, which was well below $100 in 2011, recently peaked at $125 (U.S.). Gasoline prices in the U.S. are approaching $4 a gallon, a damaging threshold for consumer confidence, and will increase further during the high-demand summer season.
 
The reason is fear. Not only are oil supplies plentiful, but demand in the U.S. and Europe has been lower, owing to decreasing car use in the last few years and weak or negative GDP growth in the U.S. and the eurozone.

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

Yes, of course, presidents have no direct control over gas prices. But the American people know something about this president and his disdain for oil. The “fuel of the past,” he contemptuously calls it. To the American worker who doesn’t commute by government motorcade and is getting fleeced every week at the pump, oil seems very much a fuel of the present — and of the foreseeable future.
 
President Obama incessantly claims energy open-mindedness, insisting that his policy is “all of the above.” Except, of course, for drilling
 
— off the Mid-Atlantic coast (as Virginia, for example, wants),
 
— off the Florida Gulf Coast (instead, the Castro brothers will drill near there),
 
— in the broader Gulf of Mexico (where drilling in 2012 is expected to drop 30% below pre-moratorium forecasts),
 
— in the Arctic National Wildlife Refuge (more than half the size of England, the drilling footprint being the size of Dulles Airport),

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