The Trudeau government was counting on a quick flip to unload the dodgy and massively overpriced TransMountain pipeline that it took off the hands of sketchy Texas oil company, Kinder Morgan.
No takers.
The leaves the feds in the bitumen pipeline business, perhaps forever. So, while some of the provinces and most major municipalities work diligently to cut greenhouse gas emissions, Justin Trudeau becomes the veritable blue-eyed sheikh. Well done, Junior.
As the picture says, "Sold Out."
5 comments:
We could see this coming. Is Trudeau as dumb as he seems? Or is he a grifter?
Well, who'd have thunk it? Wouldn't it be prudent to locate a buyer BEFORE making this outlandish offer to 'invest' in 4.5 billion $ in 'sunk costs'. And is Site C trying to play catch up?
"... the HOPE is MOST of the oil will end up in tankers bound for Asia."
The HOPE was that they would find a buyer! HOPE is a poor substitute for due diligence. They better HOPE that none of it ends up in the oceans too.
I believe their HOPE is misplaced. Kinder Morgan pipeline products have little hope competing with the 4 times as large supertankers currently plying the route through the Panama.
I'd vote Tony that he is as dumb as he seems.
Maybe it is time to look at limiting factors when discussing oil and gas before anything else.
1.No project started without at least a twenty year contract for product is viable and anything else is a gamble. (I suspect most of our projects fall in the second category).
2.Why would anyone want to pay for a ship load containing only 75% of increasingly poorer quality oil when they can get a full load of high quality oil from the Middle East and elsewhere? I was sitting beside a table of high ranking local conservatives at Timmies last week (complete with road burn on their knuckles) talking about why there is any reason for Alberta not to refine oil before selling it because they were losing too many jobs.
3. Even if the tar was removed from all oil and a light crude that can be piped easily was produce, there is already a backlog in the states as there is only three refineries that can handle light crude and they are already at full capacity. Indeed there are few refineries in Asia that can handle it as well and Middle East oil is much closer hence cheaper to ship. Since China will only do three year contracts this leaves the states as our only potential customer.
4. LNG has only one use and that is for electricity production which puts it in direct competition with renewables so any investment today will have a limited time to recover costs. The video you showed a couple of weeks ago pointed out that flared natural gas if used instead for electricity production would reduce ghg emissions equal to a billion cars which makes more economic sense than drilling for new sources. Locally a few years ago the conservatives were hung ho on fracking for local gas then using it for home heating to offset trucked in oil. The city is replacing all the pipes on one street this summer causing huge traffic jams. it would take decades to put in the underground lines to the whole city, again another made in Canada fantasy.
If we actually had a real discussion free of politicians and industry insiders about how the oil and gas industry went from 10% of our economy ten years ago to 4% now it would be painfully obvious that we are chasing some LSD induced dream rather than looking at what the industry will actually look like in twenty years. Saudi Arabia and Oman are building refineries right now against the day oil is no longer a major source of energy but rather a source of over a thousand other products.
.. we can access and analyse facts. We can can also tune out echo chamber cut and paste main media or partisan shrieking
I believe the link I sent you about 10 days ago died (404) Mound.. Here is the original I read.
https://www.nationalobserver.com/2018/03/07/opinion/fatal-flaw-albertas-oil-expansion
What bothers me is the echo chamber of flawed & incorrect terminology and the flinging of unsubstantiated information or optimism re pipelines. Between the myopic nonsense of partisan politicos and sheer laziness of mainstream media, we now get a horseshit salad over and over again. Alberta Oil, Heavy Oil, Oil, Unfairly 'discounted' Alberta Oil.. the stuff aint 'oil'.. they may as well claim sirloin is unfairly discounted because.. uh it aint tenderloin
Forgive my angst but Bitumin has the consistancy of extremely heavy, very cource cane sugar. It is not 'oil' - you could ball it up and throw it 50 feet easily if it doesn't stick to your hand. A highly refined 'diluent' is added to cleaned up Bitumin. This synthetic blend (Dilbit) is heated in order to be forced through a pipeline & it is often quoted on the stock market as WCS, Western Canada Select. It is and always will be 'worth' approx 10$ a barrel less than 'Benchmark' sweet oils ie WTI - West Texas Intermediate or Brent (sweet light crude oil) from the North Sea with far less sulpher.. and they may actually float.
Anyone who takes the time to read the perspective of the supplied link.. may get it. Asia is a pipedream re Dilbit. It will go to Washington State, some to California. Some may go direct to Houston refineries which have 'cokers' to break the synthetic stew down to component fuels or asphalt.. This not 'Nation Building', Dilbit will not 'grow the economy', the tar sands tailings ponds will never be remediated unless Canadian taxpayers who currently subsidize Big Emergy, suck it up, take one for the team and pay for decades to clean up after all the foreign owned entities sell the disaster properties to shell companies, then walk away. If the price for Dilbit was even lower in Asia, perhaps we might send a bit more.. but again, read up on the evolution of shipping 'energy' to Asia via super tankers (VLCC) that carry 2 million barrels out of Louisiana vs 4 smaller vessels trying to break through from Vancouver to the extremely volatile Hecate Staits with 500 barrels & costing more to deliver
The message today is simplistic.. apologies.. but the takeaway is...
Diluted Bitumin - Dilbit.. is not and never will be 'Alberta Oil'
But , but , but...
The Canadian banks are happy!!
They will not lose their investment.
To those that have access.
How much do Canadian banks have 'invested' in the Tar Sands?
TB
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