Oil and Gas Sector-Politics and Image – Page 136

The EU’s dubious attack on the oil sands – by Jason Langrish (National Post – February 23, 2012)

February 23, 2012

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

Jason Langrish is the executive director of the Canada Europe Roundtable for Business.

Its Fuel Quality Directive is impossible to implement

Today, the European Parliament votes on the Fuel Quality Directive (FQD), a piece of legislation that will in effect classify oil derived from the Alberta oil sands as “dirty,” possessing a higher carbon content than oil derived from other sources.

Canadian climate scientist Andrew Weaver recently published a paper that concluded that the reputation of the oil sands as polluting is overstated. So who are we to believe?

It really doesn’t matter. The reason why the FQD is a bad idea has to do with the questionable aims of the proposed legislation and the near impossibility of implementing it in a meaningful way.

If the EU wants to cut carbon dioxide emissions from upstream production, the FQD is not the right instrument. If oil sands products do not enter the EU they will find other markets, ensuring that there is no reduction in carbon dioxide emissions globally — any carbon dioxide cut the EU would claim from implementation would be false, as the FQD would simply shift the carbon dioxide elsewhere in the global system.

Canada needs an EU win on oil sands – by Claudia Cattaneo (National Post – February 22, 2012)

February 23, 2012

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

After the mess in the U.S. over Keystone XL, Canada could really use a win on Thursday — or at least the benefit of the doubt — when the European Union votes on whether to label oil from the Alberta oil sands as “highly polluting.”

A vote in favour of the Fuel Quality Directive would signal that attitudes against the oil sands are hardening, even as far away as Europe. It would also stand out as another home run for the environmental movement and its strategy of picking on the Canadian sector to fight its climate-change and off-oil agenda.

A vote against the directive would set a favourable policy precedent for Canada as it courts new markets for oil sands crude. It would also show its intense lobbying and education efforts in Europe over the past few months are working.

The directive, driven by EU Commissioner for Climate Action Connie Hedegaard, sets a mandatory target for fuel suppliers to reduce the carbon footprint of fuels by 6% over the next decade. The oil sands would be ascribed a higher value greenhouse value (107) than average crude oil (87.5), if byproducts are ever sold there.

Shale oil boom drives down prices versus rest of world – by Shawn McCarthy (Globe and Mail – February 20, 2012)

February 23, 2012

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.

North America’s crude market is increasingly diverging from the international scene, as rising U.S. production and weak demand pose long-term challenges for Canadian-based oil companies.

The U.S. is forecast to lead the non-OPEC world in crude production this year, with Canada not far behind. But that surge in supply is splashing against constraints in pipeline and refining capacity, and against a “peak demand” scenario in which U.S. consumption is not expected to return to the 1985 high water mark any time soon.

That stands in sharp contrast to the international crude market. Globally, high-growth emerging markets like China are driving demand higher, while new production capacity is increasingly concentrated in the hands of a few Persian Gulf states. Geopolitical risks – like the standoff over Iran’s nuclear ambitions – add strain to a fundamentally tight market.

The result is a sharp disconnect between international oil prices and what U.S. and Canadian producers can get for their crude, a divergence that will widen if refiners and pipeline companies fail to keep up with rising production.

How the US Shale Boom Will Change the World – by Gary Hunt (OilPrice.com – February 15, 2012)

February 22, 2012

www.oilprice.com

A funny thing is happening on the way to the clean energy future–reality is setting in. There is ‘incontrovertible evidence’ about the economic growth and job creating effects of America’s unconventional oil and gas production boom – more than 600,000 jobs directly attributable to shale gas development. Even President Obama is praising the job creating benefits of ‘America’s resource boom’. America is getting its energy mojo back and that is good news but not the entire story.

How Much Shale Gas is there in the United States? In July 2011 US EIA released a [Review of Emerging Resources: US Shale Gas and Shale Oil Plays produced by INTEK. This is an updated assessment of onshore lower 48 states technically recoverable shale gas and shale oil resources. The assessment found the lower 48 states have a total 750 trillion cubic feet of technically recoverable shale gas resources with the largest portions in the Northeast (63%), Gulf Coast (13%), and Southwest regions (10%) respectively.

The largest shale gas plays are the Marcellus (410.3 trillion cubic feet, 55 percent of the total), Haynesville (74.7 trillion cubic feet, 10 percent of the total), and Barnett (43.4 trillion cubic feet, 6 percent of the total).The INTEK assessment was incorporated into the Onshore Lower 48 Oil and Gas Supply Submodule (OLOGSS) within the Oil and Gas Supply Module (OGSM) of NEMS to project oil and natural gas production for the Annual Energy Outlook 2011 (AEO2011) to provide a starting point for future work.

The oilsands are a symptom of the bigger problem of our dependence on fossil fuels – by Andrew Weaver (Toronto Star – February 22, 2012)

February 22, 2012

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.

Andrew Weaver is a professor and Canada Research Chair in Climate Modelling and Analysis in the School of Earth and Ocean Sciences, University of Victoria. He was a lead author in the UN second, third, fourth and ongoing fifth scientific assessments of climate change.

Back in September the Keystone XL pipeline controversy was at its peak. Proponents of the pipeline were entrenched in their views that the suggested route was the only viable one. Opponents brought forward myriad concerns. Nebraskan ranchers pointed out the absurdity of building a new pipeline over the Ogallala Aquifer — the water source of much of the U.S. agricultural belt.

The National Congress of American Indians and Canadian First Nations brought forward compelling arguments that the pipeline jeopardized the potential health of their communities and resources. Others argued that it might be “game over” as far as global warming was concerned.

It was in the midst of this controversy that Neil Swart, a Ph.D. student in my lab, and I became engaged in a discussion as to the global warming potential of the oil in the Alberta tarsands. Our hunch was that it was big. We had heard the rhetoric and we wanted to undertake a quantitative assessment as to its veracity.

Oil sands proponents get a PR boost – by Nathan Vanderklippe (Globe and Mail – February 22, 2012)

February 22, 2012

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— “Dirty” is a tough label to bear. It’s simple, descriptive and evocative. It sticks.

At least it has for Canada’s oil sands sector, which has been tarred with the “dirty” brush for the products it wrests from beneath the forest of northeastern Alberta.

The industry has struggled mightily to burnish its image with TV commercials and glossy magazine ads. So it was with open arms that it greeted a new scientific report showing that burning billions of barrels of oil sands crude actually has a modest climate impact.

The report, co-authored by respected climate scientist Andrew Weaver and published in the journal Nature, shows that, when it comes to global warming, the oil sands are far from the world’s chief villain – and is being seized upon by Canada’s top industrial political leaders as proof that the oil sands aren’t as dirty as some have made them out to be.

Another pipeline debate kicks off as Kinder Morgan lines up shippers – by Carrie Tait and Nathan Vanderklippe (Globe and Mail – February 22, 2012)

February 22, 2012

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— Oil producers have thrown their support behind the proposed Trans Mountain pipeline expansion to the West Coast, but the latest project aimed at providing much-needed shipping capacity for the oil sands industry now faces regulatory hurdles and growing resistance to pipelines.

Kinder Morgan Inc. $3.8-billion plan to double the amount of oil it can move from Alberta to the Pacific has garnered “strong” support from shippers and the company will now carry on with engineering and planning, it said Tuesday.

The momentum means the Trans Mountain pipeline expansion will attract greater scrutiny – something it has largely avoided as local communities and environmental groups turned Enbridge Inc.’s (ENB-T38.870.350.91%) proposed Northern Gateway pipeline into an international debate. The federal government supports greater access to the West Coast, but arm’s-length regulators must deliver their verdicts before the projects can proceed.

Canada’s oil sands: Not so dirty after all – by Nathan Vanderklippe (Globe and Mail – February 21, 2012)

February 21, 2012

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— Canada’s government, which has threatened a trade war over a proposed European rule to penalize oil-sands crude in a bid to clean up transportation fuels, has a powerful new argument in its favour, as new research shows other energy sources are far more dangerous to the climate.

On Thursday, a committee of the European Union will vote on a proposed fuel-quality directive intended to reduce the carbon footprint of gasoline and diesel on that continent. The directive directly penalizes oil-sands crude for its high-emissions content, using language that oil-sands supporters and others have called “flawed,” “discriminatory” and worse.

If passed, such a directive could set a precedent for other international fuel rules that challenge oil-sands products, a prospect that has deeply alarmed Canada’s political and corporate leadership. Officials have waged a years-long lobbying campaign to have it changed, enlisting the help of European nations with oil-sands interests such as Britain and the Netherlands.

First nations don’t have a pipeline veto, but they do have options – by Tom Flanagan (Globe and Mail – February 21, 2012)

February 21, 2012

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.

Tom Flanagan is a professor of political science at the University of Calgary. He has managed campaigns for the Conservative Party of Canada and the Wildrose Party of Alberta. He is co-author of Beyond the Indian Act: Restoring Aboriginal Property Rights.

The Conservative government has shown that it favours Enbridge’s proposed Northern Gateway pipeline to carry bitumen from Alberta’s oil sands to the B.C. deepwater port of Kitimat. Despite this open support, there’s a risk that the Northern Gateway proposal could go the way of the Mackenzie Valley pipeline – ultimately approved in principle but held up so long it never gets built, because the market has found alternative options.

About 50 first nations lie in Northern Gateway’s path. Consultation with these first nations will be critical, so let’s look at the legal framework.

In the 1997 Delgamuukw case, the Supreme Court of Canada held that aboriginal title still exists across British Columbia where treaties have never been signed.

Oilsands in Canada – by Michael McCullough (Canadian Business Magazine – February 14, 2012)

February 18, 2012

Founded in 1928, Canadian Business is the longest-publishing business magazine in Canada.

Funny, isn’t it, that just as investment in Canada’s vast reserves of oilsands hits a new high—$134 billion worth of projects under construction or soon to start—we should be struck by an unexpected question: Does anyone even want our oil? Given recent events, you couldn’t blame us for wondering.

For virtually all of the oilsands’ 45-year operating history, the overwhelming challenge was at the upstream end, finding technically and economically viable ways of getting the oil out of the sand, and coaxing brave investors to fund them. In the blink of an eye, the greatest obstacle has drifted downstream to the relatively simple matter of getting the stuff to market.

The obvious solution is to build pipelines emanating from northern Alberta to deliver more of our crude to the world. But recent events have shown that to be more problematic than anyone could have guessed.

Certainly the announcement on Jan. 18 was an abrupt and unexpected reality check. Forced to render an immediate decision on the controversial Keystone XL pipeline proposal by Republican opponents in Congress, U.S. President Barack Obama turned down would-be builder TransCanada Corp.’s application.

All eyes on tight oil’s future – by Claudia Cattaneo (National Post – February 16, 2012)

February 16, 2012

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

CALGARY – Tight oil, the new oil source unlocked by new drilling technologies, is bearing such good results it could quickly compete with Canada’s oil sands as a top secure supply of North American oil.

With companies like Devon Energy Corp., Talisman Energy Inc., Encana Corp. and Exxon Mobil Corp. pushing big spending toward tight oil, analysts are ratcheting up their production forecasts for the supplies, which are largely based in the United States.

“Tight oil is changing the landscape in North America,” Steve Fekete, managing consultant at Purvin & Gertz, said at an oil sands industry conference in Calgary this week.

The international energy consultancy predicts production of tight oil in the United States alone could reach between 1.4 million barrels a day and 2.4 million b/d by 2020 – from about 600,000 b/d today derived in large part from the Bakken field in North Dakota.

TransCanada pushes back on Keystone XL – by Claudia Cattaneo (February 14, 2012)

February 15, 2012

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

Getting swept up in U.S. Presidential politics can’t be high on the list of any Canadian corporation, but TransCanada Corp. isn’t backing down from its plans to build the Keystone XL oil sands pipeline.

The Calgary-based company said Tuesday it’s gearing up to file for a new permit “in the near future,” is anticipating obtaining Presidential approval in the first quarter of 2013, expects it will take two years to build it and plans to start shipping 830,000 barrels of oil from the oil sands in Alberta to the U.S. Gulf Coast in 2015.

“We are into it to the tune of $2.4-billion, we have secured about 95% of the right of way, the pipe is all sitting on the ground and the pumps are all ready to be hooked up. For all intents and purposes we are ready to go,” president and CEO Russ Girling said in a conference call to discuss the company’s results for the fourth quarter.

What it won’t do is get involved in the U.S. election, which Mr. Girling feels is not his company’s business.

U.S. loses Canada’s precious oil – by Rick Perry (National Post – February 14, 2012)

February 14, 2012

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

Rick Perry is the Governor of Texas.

Prime Minister Stephen Harper was in Beijing recently signing an agreement and touting his country’s growing energy partnership with China. It’s good news for Canada, which is rightfully looking to grow markets for its sizeable oil reserves. And it’s particularly good news for China, which needs to keep tapping into fresh supplies to feed its growing economy and mounting demand for oil.

Unfortunately, it’s bad news for Americans, particularly when you consider that one of the main reasons China has become such an attractive market to Canada was President Barack Obama’s recent rejection of the Keystone XL Pipeline. This crossborder connection would have provided a golden opportunity to partner with our neighbours to the north in producing massive amounts of energy, both for our country and the globe.

It seems unimaginable, yet President Obama refused TransCanada’s request to run its pipeline across the border from Canada to the Texas Gulf Coast. This extensive pipeline holds the potential of moving up to 830,000 barrels of crude oil per day – including oil produced in North Dakota and Montana – to refineries here in Texas.

Hope lives for Saskatchewan oil sands – by Claudia Cattaneo (National Post – February 14, 2012)

February 14, 2012

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

CALGARY — Barely five years ago, Oilsands Quest Inc. proved there are oil sands in Saskatchewan and wanted to build the province’s first major project.

Today, the company is in bankruptcy protection in Canada and the United States and is looking for a buyer, keeping on hold the province’s ambition to be a part of the booming industry.

As established oil sands companies announce big profits and big expansions, Oilsands Quest’s story is a reminder that a lot can go wrong, fast, in the business, including running out of cash, mounting costs, poor geology or simply being ahead of the times.

Still, Garth Wong, president and CEO of the company, is hopeful Saskatchewan’s oil sands will get a second chance as the company waits for the outcome of a sales process now under way, in an improving investment climate and as other companies move close to its edge of the basin.

It’s time for Canada to play trade hardball – Diane Francis (National Post – February 11, 2012)

February 11, 2012

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

The Prime Minister’s visit to China netted more than a couple of pandas for a decade. It got Washington’s attention. The optics, notably concerning the oil sands, were the main aim of the high-level visit. And it worked.

The threat that Canada would divert energy to China instead of to the United States led Mitt Romney to hoist approval of the Keystone XL pipeline to the top of his political agenda.

There is little doubt that a new version of the Keystone, with a different route or by train, will be approved even if U.S. President Barack Obama wins a second term. The Keystone project was ill-conceived from beginning. The route was foolish. Moreover, oil sands production should be upgraded in Canada or shipped by looping existing pipelines from north to south.

The timing made it impossible for any sitting president to approve, especially when to do so would alienate a large chunk of the base of his support. Any mega-project should be broken down into bitesized pieces, avoid election cycles and operate under all radars.