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Originally Posted by Northendzone
so to summarize where we are at with oil:
* JT and his liberal bagmen bought TMX for $4.500,000.000
* Notley and her friends are going to throw another $3,700,000,000 at the issue
So a little over $8,000,000,000 of public money for something a private company was seemingly willing to do. And the pipeline has not even started to be built. I can only imagine how the government will mess that process up
seems to me that the government mismangement of this natural resource is epic. Are there any other countries who have taken a valuable commodity like this a fumbled it so badly?
The Saudi's and the american must laugh every day at what patsy's we are.
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On the rail side if pipelines don’t get built the Alberta government should make a tidy profit. The Diff should settle at the cost of the marginal barrel so provided oil stays above around $50 WTI rail shipping will be profitable. Where this has a chance to blow up is if pipeline capacity increase faster than the rate of new oil.
Same with the pipeline if they get it built the pipeline has a positive NPV at a 10% discount rate so will be a profitable investment even with delays and overruns. (You might not hit a 10% rate).
Why industry isn’t doing these things is risk. So the government is risking 8 billion as opposed to wasting 8 billion.
In general I agree with you the private sector would have taken both the rail and pipeline risks if we had s reasonable regulatory environment.