Official (Alberta) Oil Discussion Thread

[Azure]

I hate it when the price of natural gas goes up.

Makes a grown man cry seeing all that opportunity being pissed away by our country.

[Azure]

Canada? Are we expanding production?

https://twitter.com/user/status/1520395668233273346

[accord1999]

Originally Posted by Azure

Canada? Are we expanding production?

Still don't even have a LNG terminal, let alone one that can efficiently ship to Europe.



Meanwhile, the 7th US terminal has come online:


https://www.eia.gov/todayinenergy/detail.php?id=52238

[Mayo]

Originally Posted by Azure

Canada? Are we expanding production?

https://twitter.com/user/status/1520395668233273346

Lol

Saguenay LNG - how incompetent of a federal government do you need to have not to push something like that through? I guess now we know

[Tiger]

Originally Posted by Mayo

Lol

Saguenay LNG - how incompetent of a federal government do you need to have not to push something like that through? I guess now we know

Very incompetent... But it was more so the incompetents of the conservatives from 2006-2015 that made this mess. especially with a majority from 2011-2015

[Mayo]

Originally Posted by Tiger

Very incompetent... But it was more so the incompetents of the conservatives from 2006-2015 that made this mess. especially with a majority from 2011-2015

But what about!!!!

[Tiger]

Originally Posted by Mayo

But what about!!!!

everyone complains that liberals didn't get pipelines done in time to benefit. but it was the conservatives who ####ed everything up and didn't get it done when they had majorities and there was less public against it.

[Rutuu]

I always blame industry...they were ok with the US as their only customer, and no company has taken the technical challenge to go northern routes through the Yukon or through Sask/Manitoba. Instead they try to force populations in Quebec and BC that consistently vote against expanding fossil fuel infrastructure to let them build.

That's just me though.

[GGG]

Originally Posted by Rutuu

I always blame industry...they were ok with the US as their only customer, and no company has taken the technical challenge to go northern routes through the Yukon or through Sask/Manitoba. Instead they try to force populations in Quebec and BC that consistently vote against expanding fossil fuel infrastructure to let them build.

That's just me though.

Only 1 of the 4 proposed LNG plants got off the ground.

I don’t think you can blame industry when people are misinformed. The church hill and Yukon ideas are not very economically attractive.

[Fuzz]

Industry tried a pipeline to the north(Mackenzie gas), but approval took so long they eventually walked away in 2017(low gas prices and increased costs had a big impact on that). That was to bring gas south, so different goals, but the result probably would have been similar with export.


Industry will do whatever makes financial sense. Blaming them for not engaging in nation building goals is misunderstanding how industry works. Money.

[accord1999]

Originally Posted by Tiger

everyone complains that liberals didn't get pipelines done in time to benefit. but it was the conservatives who ####ed everything up and didn't get it done when they had majorities and there was less public against it.

Two big pipelines did get completed during Harper's reign, Enbridge's Line 67/Alberta Clipper with initial capacity of 450K barrels/day and TC's original Keystone. Both started operation in 2010 and has seen a number upgrades since. And just after Harper lost power, Enbridge finally was able to reverse Line 9 to send more Alberta oil to Quebec via Ontario.

[Rutuu]

Originally Posted by Fuzz

Industry tried a pipeline to the north(Mackenzie gas), but approval took so long they eventually walked away in 2017(low gas prices and increased costs had a big impact on that). That was to bring gas south, so different goals, but the result probably would have been similar with export.


Industry will do whatever makes financial sense. Blaming them for not engaging in nation building goals is misunderstanding how industry works. Money.

You're definitely hitting the nail on the head as far as why I blame industry. Money. They didn't think ahead on who their customer was or lack of diversity in that customer base, and that resulted in short term gain, with long term pain. Every producer in Canada assumed an almost infinite market for their product in the US. When the LNG projects did start to be proposed they underestimated the political risk.

At the end of the day, the gas infrastructure in North America is well connected. LNG terminals anywhere on the continent expands the system capacity. The only difference is Canada is at the end of the pipe, so transportation costs are greater.

When industry begs for pipes, they really just want a subsidy from the government in my mind on higher transportation costs, and for myself I see other sectors that should get those funds.

[GGG]

Originally Posted by Rutuu

You're definitely hitting the nail on the head as far as why I blame industry. Money. They didn't think ahead on who their customer was or lack of diversity in that customer base, and that resulted in short term gain, with long term pain. Every producer in Canada assumed an almost infinite market for their product in the US. When the LNG projects did start to be proposed they underestimated the political risk.

At the end of the day, the gas infrastructure in North America is well connected. LNG terminals anywhere on the continent expands the system capacity. The only difference is Canada is at the end of the pipe, so transportation costs are greater.

When industry begs for pipes, they really just want a subsidy from the government in my mind on higher transportation costs, and for myself I see other sectors that should get those funds.

Not subsidy, a regulatory regime that recognizes the value that is subject to fixed timelines and once a decision has been reached that the decision will be upheld.

[Rutuu]

Originally Posted by GGG

Not subsidy, a regulatory regime that recognizes the value that is subject to fixed timelines and once a decision has been reached that the decision will be upheld.

I agree with you. Gotta go where you're wanted though if you want a friendly regulatory regime. Industry failed to recognize that, and took the attitude that they could change people's minds. They assumed they had a social licence to operate and gave up when the risk presented itself.

In my view it isn't the government's responsibility to start carrying the flag now for industry trying to win hearts and minds to keep their costs down.

[GGG]

Originally Posted by Rutuu

I agree with you. Gotta go where you're wanted though if you want a friendly regulatory regime. Industry failed to recognize that, and took the attitude that they could change people's minds. They assumed they had a social licence to operate and gave up when the risk presented itself.

In my view it isn't the government's responsibility to start carrying the flag now for industry trying to win hearts and minds to keep their costs down.

That’s exactly what the governments job is in terms of managing the economy.

Create an environment that encourages capital investment. I also don’t think they want a friendly regulatory environment they want a stable one with finality.

[edslunch]

not good

Ottawa’s purchase of the Trans Mountain pipeline expansion project is no longer projected to be profitable because of construction delays and higher costs, says Parliamentary Budget Officer Yves Giroux in a new report.

The Liberal government purchased the expansion project in 2018 from Kinder Morgan Canada Inc. at a cost of $4.4-billion. The project will twin an existing pipeline to address long-standing concerns that Western Canadian crude oil was selling at a discount owing to a lack of capacity needed to ship to export markets.

The purchase has frequently been criticized by environmentalists and the federal NDP as contrary to the Liberals’ stated desire to reduce Canada’s carbon emissions.

A 2020 report by the PBO projected that once in operation, the government would be able to sell the project at about a $600-million profit. Wednesday’s report said that forecast has since shifted to a projected $600-million loss.

http://www.theglobeandmail.com/polit...ine-expansion/

[Nufy]

I expected all along that it will be sold at a loss...probably to a FN led group anyways...

Not like this govt has any expectation of fiscal policy.

[Zarley]

Originally Posted by edslunch

not good



http://www.theglobeandmail.com/polit...ine-expansion/

Not a surprise - there's a reason why private investors have walked away from all of these projects. It's looking like a good decision by Kinder Morgan, especially given unprecedented escalations in construction costs we've seen as of late.

Fortunately the tax revenue from increased takeaway capacity will more than justify a loss on the project itself.

[oilyfan]

A loss ($600M, a pittance considering the pipeline revenues are $20B and up), calculated using transit cash flows and discounting at around 8.5% per year.

So the project will only deliver 8% IRR (approximately) plus additional revenue from personal and corporate taxes, plus the support of a strategically valuable industry and high-paying jobs for decades.

Almost every country in the world would fall over to have a project like this in their jurisdiction.

This is a sensationalist headline. The reality is this was always and remains a very good project for Alberta and Canada.

Originally Posted by edslunch

not good



http://www.theglobeandmail.com/polit...ine-expansion/

[Wastedyouth]

Originally Posted by oilyfan

A loss ($600M, a pittance considering the pipeline revenues are $20B and up), calculated using transit cash flows and discounting at around 8.5% per year.

So the project will only deliver 8% IRR (approximately) plus additional revenue from personal and corporate taxes, plus the support of a strategically valuable industry and high-paying jobs for decades.

Almost every country in the world would fall over to have a project like this in their jurisdiction.

This is a sensationalist headline. The reality is this was always and remains a very good project for Alberta and Canada.

This.