Monday, May 27, 2019

Eviscerating The Bitumen Bullshit

Give Jason Kenney, his predecessor, Rachel Notley, and our prime minister, Justin Trudeau, their due. When it comes to bitumen and bullshit they'll lay it on just as thick as they can every chance they get.

The Tyee's petro-scribe, Alberta's own Andrew Nikiforuk, systematically debunks every popular lie these characters like to spread about Trudeau's damned pipeline and bitumen's dismal future.

To most coastal British Columbians there's a real malice that emanates from the petro-state's campaign of deceit whether that's from Alberta, Saskatchewan or Ottawa.

I urge you to follow the link and read it in its entirety. For now, here are a few teasers:

According to some of the more ridiculous claims, environmentalists are to blame for bitumen price discounts, Vancouverites are being punished for their orca-loving ways with high gasoline prices, and climate change really doesn’t matter. 
Their politicians don’t dare admit the reality — that combined overproduction of bitumen and U.S. tight oil brought down the global price of oil with a thundering crash in 2014. In the world we inhabit now, oil business as usual has died.
The plot to thwart bitumen sales to China.
The facts are these: Over decades the U.S. has built more than half of the world’s heavy oil refining capacity in the Midwest and Gulf Coast for a variety of reasons. 
Asia owns but 23 per cent of global capacity to refine heavy oil. It’s not willing to pay more for bitumen than the U.S., because it costs more to ship it there.

Alberta’s low royalty policy encouraged the industry to strip and ship diluted bitumen instead of adding value by building more upgrading facilities and complex refineries. 
The province’s dependence on U.S. markets and pipelines is a direct product of what was billed in 2006 as Alberta’s “give-it-away” strategy. 
Obstruction of Trans-Mountain has left BC with a fuel shortage entirely of its own making.
Most of the gasoline consumed in B.C., the nation’s fourth largest market for refined fuels, is made by four Alberta refineries and moved along the existing 65-year-old Trans Mountain pipeline. Less than 10 per cent of the province’s gasoline comes from refineries in Washington State. 
(An historical note: when the Trans Mountain pipeline was built in the 1950s, Vancouver supported four refineries, but as the line exported more oil to U.S. refineries, local refining died off in the 1990s with the exception of Parkland, formerly Chevron, in Burnaby.) 
The Vancouver market has no ready access to refined products brought by sea, so it is a price taker. Economist Robyn Allan calculates that neither taxes, nor scarcity of supply, fully explain why the region has some of Canada’s highest gasoline prices. 
A study by the Canadian Centre for Policy Alternatives suggests Alberta refineries have been price gouging Vancouver consumers since 2010, because they can do so due to lack of local competition.
...To date, high prices have had a predictable effect: B.C.’s per capita consumption of refined petroleum goods is 11 per cent below the national average.
Bitumen is the "beating heart" of the Canadian economy.
That’s a big laugh. 
Despite 47 per cent growth in Canada’s oil and gas production since 2000 — largely from the tar sands — royalty payments to government have declined 59 per cent, notes respected energy analyst David Hughes. 
So, too, has the industry’s proportional contribution to GDP.
According to data from Natural Resources Canada, taxes paid by the oil and gas industry since 2006 have dropped from $12 billion to $6 billion*.
It's "Ethical Oil."
There is light oil and heavy oil, but no refinery has ever begged for ethical oil. 
That’s because it doesn’t exist. If Alberta has done such a “moral” job of regulating its resources, what happened to its rainy day fund? 
And if the industry has behaved so ethically, why will Alberta and Canadian taxpayers likely be on the hook for cleaning up and decommissioning $260-billion worth of abandoned wells, pipelines and gas plants?

How ethical is it to allow an industry to set aside funds of $1.6 billion to cover hundreds of billions of dollars in liabilities? 
New research says that “carbon dioxide emission intensities for oil sands facilities are 13 to 123 per cent larger than those estimated using publically available data.”

Is that an ethical development?
Let's do the math. A quarter trillion dollars of unfunded remediation costs versus six billion dollars a year* in royalties to the Alberta treasury. Imagine finding a bar that lets you run a tab for 43-years. That's 43-years worth of royalties.

Myth: Every day Canada loses 30 to 40 million dollars from a shortage of pipeline capacity. That's a lie, one of Junior's favourites.
To illustrate the grandiosity of the claim, just consider the finances of Suncor, one of Canada’s largest bitumen miners. If the industry were losing so much money every day, you’d expect Suncor to be bleeding, too.

But that’s not what its financial statements say.

In fact, Suncor has been recording tidy profits for years, because it mines, upgrades and refines bitumen into a variety of refined products.

The company also hedges against oil price volatility and heavy oil discounts. Even with mandated provincial cuts in production, the company produced396,000 barrels of bitumen in the first quarter of 2019, with net earnings of $1.4 billion compared to $789 million in 2018. 
Husky and Imperial Oil, the province’s other big producers, also reported healthy returns this year.
...So don’t try bullying British Columbians with fictional losses produced by fictional pipelines. 
Alberta’s three major bitumen producers make money regardless of pipeline politics, because they do everything Alberta failed to do: they hedge, add value and refine.
US-funded environmentalists are waging a campaign to block Canada's access to Asian markets. They're out to sabotage our economy.
No conspiracy existed. The campaign largely focused on bitumen’s distinct character. Such crude has higher energy costs and an extreme carbon footprint compared to conventional oils. 
Alberta’s remains one of the world’s dirtiest oils, with emissions 102 to 204 per cent higher than average U.S. refinery crude on a well-to-tank basis that includes all the emissions from mining, upgrading and refining.

That’s why Alberta’s oil was targeted. Period.

And given that oil sands production has increased 376 per cent since 2000, and overall oil and gas production has grown by 47 per cent in Canada, “the alleged foreign funded attack” has been damn ineffective, notes analyst Hughes.
Here on the coast we know these truths. We see the malicious lies, and they are malicious, spun by Ottawa and the oil provinces for what they are, an attack on us and on our coast.  The threats make their malice even more intolerable.


rumleyfips said...

Elizabeth May now wants me to use Alberta bitumen in Nova Scotia. It looks like she now supports Energy East, a project I , along with millions of Canadians , oppose. There go her votes in Ontario, Nova Scotia and especially Quebec.

The Mound of Sound said...

She wants it refined in Alberta.

Anonymous said...

Medicine Hat just closed down its solar panel farm. It wasn't making enough energy. What a pile of crap that is. Everywhere there is a Con Government, there is that kind of misleading statements. Why hasn't the Municipality sent a delegation to China to observe and learn how China is making solar it's number one energy use in that country. All these people do is continually fart through their brains.

The Mound of Sound said...

Anon, if they can produce cheap solar energy in dreary, overcast Germany, it's impossible to believe they can't do far better in Medicine Hat.

Anonymous said...

1:11 They can't or can..... too do better in Medicine Hat....they have 330 days of sunshine every year and the temp is much higher year round than Calgary. There are many homes in Medicine Hat owned by people who have solar. They produce more than they can use. But, the City of M.H. does not allow the buying of extra energy.

Jay Farquharson said...

It’s a thermal solar plant. Reflectors heat water, most of the steam is used for heat, some is used to make electricity.

The City has decided it’s cheaper to buy electricity and natural gas, than to continue to operate the facility.

For now, it’s being mothballed and maintained.

Were someone who needs a large amount of heat or steam to locate in Medicine Hat, (greenhouses?), then the City has said they would make the plant available.

The Mound of Sound said...

Thanks, Jay.

rumleyfips said...

Expanding production of the filthiest petro known , no matter where refined, is hardly green. I have voted green ( no local candidate last time but May has driven me away.

Jay Farquharson said...

Canada imports oil and finished products.

Canada exports oil, heavy oil and dilbit, ( which is not oil).

If Alberta kept production at the current rate of tarsands extraction, refined on site, the petcoke could be safely sequester in the tarsands pits, there would be no need for explosive dilutient, existing pilelines and railcars would easily handle the volumes of distributed finished product, Alberta would get premium prices for the product, Canada could stop importing oil, and Canada would probably stop exporting oil.

Most of Alberta’s crude and tarsands goes south. A small amount comes back as refined product.

May’s Plan, a variation on a NEP would actually reduce tarsands, raise Alberta jobs and revinues, shut down imports of less “ethical” oil, reduce emissions, and protect Canadians and the industry from “oil shocks” while we transition to a greener economy.

Anonymous said...

Good rebuttals of the petro state BS all our "leaders" are in thrall to, no matter what they say. I think based on the NEB stats, tarsands production has actually gone up by over 50% since 2010, which is even worse than the author states. Over 20% while Notley lied her head off while in power.

Of course, Canada is the number one secret society. Compared to even the UK, we are kept like mushrooms, Vitamin claims are hardly disputed by the dipshitz at Health Canada as CBC Marketplace showed - consumer protection is virtually non-existent. So why would we expect the Feds to be open to the public on other files? We are used to living by calling old wives' tales, myths and legends fact. And nobody knows bugger all about anything, May included on some points.

Nova Scotia gets two-thirds of its gasoline by tanker from US Gulf refineries. The other third comes from the Irving refinery in New Brunswick; they cannot process dilbit, and were merely going to be a tidewater export base for it for deliveries by original Energy East. The port was built but is sitting there in mothballs in Saint John while Irving refuses to pay property taxes on it. Even gasoline from the EU gets imported in exchange for surplus diesel through Montreal. To find these things out, you have to dig through dozens of incredibly badly organized Fed NEB and provincial web pages. There are no nice summary pages of obvious info. Nobody cares - or they do care and deliberately miss the point. Most government things are not well publicized. So it's easy to get hold of the wrong end of the stick, especially as the oil companies feel no need to be more public - they're mostly foreigners anyway, feeding off our resources like pigs at the trough and then refusing to pay royalties of any value. And our politicians cheer at the "investment" where we give away our public resources for bugger all.

What we need in NS is Alberta gasoline, because there is no refinery capacity here whatsoever, which is why the arrangements we have are the way they are.

I have read more clacking tongue horse manure from people who know bugger all about the details of the oil industry in our country, because they haven't learned it. And it's not all their fault, as I've said. The info is hidden and requires extraction. So Kenney can go off on his pie-in-the-sky delusions, and he's probably misinformed as well, which allows drawing of false conclusions very few will dispute other than in a general way. We're stats starved. Even dilbit is referred to as heavy oil as a childish disguise in Fed documents.

@ rumleyfips, I live in the same province as you and I'd bet you had no idea where our gasoline is sourced, but I spend far less time eulogizing Twinkletoes JT on Montreal Simon. You never supported the Greens, I'd bet, and now you have invented the perfect excuse for rejecting May - in your mind. It's a free world, just don't blow smoke my way and expect no response. You know MoS is a Green, so you decide to come in and try and wreck things and then get your facts wrong. Can see right through you.


Jay Farquharson said...


Yup, double yup.

And those tankers burn bunker fuel, and the Gulf Coast ones are hauling “Alberta” gas made from dilbit.

The energy savings/carbon reduction from getting Alberta gas, from Alberta, directly, would be huge.

the salamander said...

.. let's see how long it takes me to type
'reference or source doc title - or direct web link validating or supporting this ?'
OK.. that took about 10 seconds - I should know, I type it approx 5-10 times daily in comments, responses on blogs or 'the news' or on Twitter or Facebook. Laughably I never got a response from Licia Corbella, Ezra Levant Andrew Scheer or Justin Trudeau. Nor did Peter Kent, Joe Oliver, Bill Morneau, Lisa Raitt get back to me. I have Doug Ford's 'private' cel phone number but I'm so saturated by the flow of bullshit I don't volunteer anymore to have my leg pissed on

I maintain, a Grade Five primary school class could as class environmental project or geography lesson, create more logical & factual documents for public consumption regarding ENERGY EXTRACTION IN CANADA

'Even last year, when discounts really hit hard, the price of Canadian heavy oil in Houston often traded at a premium to West Texas Intermediate..' (schoolkids - prove or disprove please ?)

Now I may have to inquire from Mr Nikiforuk who I trust implicitly, or Andrew Leach, or Mound.. as that seems more like a typo or unedited sentence.. For one its too general. There are lots of 'heavy oils' - just as there are lots of blends of dilbit, synbit etc. But I find it hard to believe a heavy oil sold at higher price than West Texas Intermediate.. a light sweet oil.. indeed the North American benchmark oil. If I saw the two corresponding dated price charts & had a smidgen of info re the seller and the buyer.. or 'trend' - I could be convinced. But this troublesome inclusion seems poorly aimed at the heart of the whole 'unfairly discounted Canadian oil' hue and cry of Jason Kenney, Andrew Scheer.. and Justin Trudeau just plays it like a fiddle.. with the whole fantasy of 'getting all that wealth to Asia' via pipeline and supertankers.. You know - to quash the 'unfair discount' eh.. you just stuff a diluted bitumin blend like WCS (Western Canada Select) into a heated pipeline to Burnaby BC, shove it via tugboats, from the dock in supertankers and poof pang 1 - 2 - 3 it turns into North Sea Brent benchmark sweet oil.. while enroute - caloo callay hellalujah amen !!!!

School kids would decimate this ..

I ranted in the past, I will rant in the future - calling for responsible journalism, responsive non partisan political governance and public servants, a hasty exit of religious dogma and nonsense from politics, and the exclusion of $ dollars & money $ from elections & public service.. plus the hasty end (plus investigation) of related polls and electoral databases funded by taxpayers.

Here's a scenario or two to consider.. Imagine a town hall, regarding Energy Extraction, televised live, with hundreds of Grade Eight students, as the live audience and showrunners. The contestants uh, Justin Trudeau, Andrew Scheer, Jason Kenney, Ms May. Sixteen sealed envelopes. Each guest opens, reads aloud and responds to the question or invitation to explain.. of four envelopes during the event. Its random of course. Topics set by the students after they have completed related projects. The restricting, even frightening payoff is - all 16 responses will be fact checked by thousands of Canadian schoolchildren.. and published ... well, hell.. that opens up the field of opportunity !! It also opens a yawning abyss. Of course, those 'public servants' could always resort to The Harper Closet Defense.. 'I know nothing of these matters' .. 'not on our radar' ..

Anonymous said...

The City of Medicine Hat was told not to go the route they went. But to use Solar directly from the Sun. It was not a viable project from the beginning as there isn't enough rain fall in the Medicine Hat area. The South Saskatchewan River is the lowest ever seen. Now the city has to provide water for the huge Cannabis Green Houses. One-eighth of an acre (50 feet by 100 feet with 50 cannabis plants) uses 24,000 gallons of water ...a million-square-foot greenhouse or 21 football fields in Medicine Hat is 60% exempt from property tax with 30 million dollar investment subsidy. The City had to save money from somewhere while property taxes have increased. Who is paying for this venture?