Canadian oil

[swimmer_spe]

Alberta has been upset that Keystone, Transmountain and Energy East pipelines have been canceled/halted, etc. All of these pipelines were to export oil from Canada. Canada does have the oil resources to be isolated from world market problems. Canada does not have the refineries to be insulated, so we must ship our oil to other countries to meet our demand.

I know that the politicians of Alberta will use this as a reason for pipelines.Maybe we should focus on ensuring we have the capacity to supply Canada with all it needs before we ship it elsewhere.

[casper]

Originally Posted by swimmer_spe

Alberta has been upset that Keystone, Transmountain and Energy East pipelines have been canceled/halted, etc. All of these pipelines were to export oil from Canada. Canada does have the oil resources to be isolated from world market problems. Canada does not have the refineries to be insulated, so we must ship our oil to other countries to meet our demand.

I know that the politicians of Alberta will use this as a reason for pipelines.Maybe we should focus on ensuring we have the capacity to supply Canada with all it needs before we ship it elsewhere.

Trans-mountain is an interesting one. It is being built. When it was clear the owners were not going to move forward with the project, the federal government purchased the operation and turned it into a crown corporation.

People in Alberta who are upset with the Liberals and federal government have a real problem with Trans-mountain. They would like to stick to the story that JT is trying to kill their industry and the feds are doing everything to destroy the industry. Trans-mountain just does not fit the narrative.

A few other things that are neat about it. So it amounts to twinning an existing pipeline. The existing pipeline feeds a small refinery in Prince George. It also feeds the Parkland refinery in Burnaby and refineries in Washington state. Not certain the current status but at one point I was told by someone in the industry that the Burnaby refinery mostly does specialty product and premium fuel with regular gas coming mostly from Washington state. To add even more complexity there is also railway cars brining in oil from Alberta.

You can also feed refined product down trans-mountain. Apparently this is a unique feature of this pipeline. As a result the pipeline also carries refined product from refineries in Edmonton to the metro Vancouver market. That feeds storage tanks around Parkands that belong other oil companies.

Next to Parklands refinery is also a marine terminal that can be either used to export or import crude or refined product.

From Parklands there is an underground pipeline to the Vancouver Airport to supply aviation fuel. YVR wanted more flexibility in supply so there is also a terminal they built on the Fraser that can accept tankers from Asia and that has an underground pipeline across Richmond to the Vancouver airport. So jet fuel can either come from domestic of foreign sources.

Vancouver Island gets most of its fuel by barge from either Parklands or the refineries in Washington state. Its terminals are generally mid island.

The key issue about all of this is resilience. Having multiple ways of getting fuel into the market is critical. This was quite evident this winter where we had severe storms that shutdown trans-mountain. The same storms also isolated Victoria from mid-island where all the fuel comes onto the island. The government had to ration fuel.

That is the complex supply chain at play in what amounts to one small corner of the country. Your going to see the same in every other part of country.

You then also have the case that in a capitalist country there is no central planning. A good example is jet fuel. So the airports in Vancouver and Toronto have some co-op that owned by the airlines that operates the fuel delivery infrastructure. Each airline is responsible for buying its own fuel and having it delivered into the airport distribution system. Air Canada is free to buy its fuel from Parkland and have it delivered to YVR, or bring it by truck from the refineries in Washington state or bring a tanker in from South Korea. It is likely going to use who ever gives it the best deal.

[SignalHillHiker]

We could help as well but I’m starting to suspect NL’s oil industry will be sacrificed by the Feds for brownie points with environmentalists. Equinor (Norway) has been waiting years for environmental approval for its Bay du Nord project, which is huge and will be among the “cleanest” oil available anywhere on earth. The federal environment minister, a Greenpeace exec from Quebec, obviously would be willing to sacrifice us rather than go after Alberta.

They leaked that the federal Cabinet was divided, local experts suspect in an attempt to scare off Equinor, but it didn’t work because Equinor is committed to the lowest-carbon oil we offer. So they just delayed the federal decision another 40 days.

To add insult to injury, the Atlantic Accord puts this decision, in these circumstances, solely with CNLOPB. Ottawa is only supposed to be involved in extraordinary circumstances.

Curious to see if they dare basically shut down the province’s economy by signaling offshore oil development is over. We’ve only 7 seats but they can matter in a minority government.

[Truenorth00]

The fundamental problem any large oil project has, at this point, is that it is a bet on the global failure of climate policy. Because even a plateauing of global demand for oil would kill the business case for most of these projects. But especially the high carbon proposals. Bay du Nord might have the carbon profile that fits. But are they willing to see the development right through to 2050?

[swimmer_spe]

Originally Posted by Truenorth00

The fundamental problem any large oil project has, at this point, is that it is a bet on the global failure of climate policy. Because even a plateauing of global demand for oil would kill the business case for most of these projects. But especially the high carbon proposals. Bay du Nord might have the carbon profile that fits. But are they willing to see the development right through to 2050?

So, the skyrocketing gas prices might push most Canadians to decarbonize their life?

[Truenorth00]

Originally Posted by swimmer_spe

So, the skyrocketing gas prices might push most Canadians to decarbonize their life?

Not immediately. But over time? Absolutely. I don't think anybody is going to forget $2/L when they go car shopping over the next few years.

Also, demand for oil is global. And now you have the EU saying they will pour in hundreds of billions to cut oil and gas demand as quickly as possible. In no small part, this is an effort to reduce reliance on Russia. But the network effects of that investment aren't likely to be contained to Europe. EU is basically treating this like a wartime mission to cut oil and gas demand.

https://www.bloomberg.com/news/featu...-global-energy

[thewave46]

Originally Posted by SignalHillHiker

We could help as well but I’m starting to suspect NL’s oil industry will be sacrificed by the Feds for brownie points with environmentalists. Equinor (Norway) has been waiting years for environmental approval for its Bay du Nord project, which is huge and will be among the “cleanest” oil available anywhere on earth. The federal environment minister, a Greenpeace exec from Quebec, obviously would be willing to sacrifice us rather than go after Alberta.

They leaked that the federal Cabinet was divided, local experts suspect in an attempt to scare off Equinor, but it didn’t work because Equinor is committed to the lowest-carbon oil we offer. So they just delayed the federal decision another 40 days.

To add insult to injury, the Atlantic Accord puts this decision, in these circumstances, solely with CNLOPB. Ottawa is only supposed to be involved in extraordinary circumstances.

Curious to see if they dare basically shut down the province’s economy by signaling offshore oil development is over. We’ve only 7 seats but they can matter in a minority government.

I would wager that Ottawa doesn’t want to sink the NL government’s fiscal ship even worse though. Approving the project might be part of the lifeline NL needs to get over the hump of the next few years, especially if there are a group of MPs who do have sway in government.

Despite the claim to green, Ottawa is in a deep hole. I doubt they will be looking to dig deeper, so sacrificing their green credibility in the short term may be a play they entertain.

[goodgrowth]

Originally Posted by thewave46

I would wager that Ottawa doesn’t want to sink the NL government’s fiscal ship even worse though. Approving the project might be part of the lifeline NL needs to get over the hump of the next few years, especially if there are a group of MPs who do have sway in government.

Despite the claim to green, Ottawa is in a deep hole. I doubt they will be looking to dig deeper, so sacrificing their green credibility in the short term may be a play they entertain.

The minister in charge is a former Greenpeace member and has Quebec climate activists breathing down his neck on it.

Even more annoying is the Bloc Quebecois being vocally against this project. Funny how a party that is voted to primarily represent Quebec interests have opinions on large projects outside their jurisdiction.

The Bloc Quebecois of course support Bombardier because jobs and whose main export is now PRIVATE JETS. Literally the monster truck of air travel.

Remember folks fossil fuels are bad*

*conditional on what point of the supply chain it occurs.

[thewave46]

Originally Posted by goodgrowth

The minister in charge is a former Greenpeace member and has Quebec climate activists breathing down his neck on it.

Even more annoying is the Bloc Quebecois being vocally against this project. Funny how a party that is voted to primarily represent Quebec interests have opinions on large projects outside their jurisdiction.

The Bloc Quebecois of course support Bombardier because jobs and whose main export is now PRIVATE JETS. Literally the monster truck of air travel.

Remember folks fossil fuels are bad*

*conditional on what point of the supply chain it occurs.

The Minister of Environment may find that his opinion may be somewhat muted in light of the opinions of the Minister of Finance and several MPs from the province, all of which the government would very much like to retain in the next election.

As for the BQ, who cares? The support of the NDP will be more key.

[Mister F]

The world is already on a path away from oil, with massive investments into EVs, green energy, and battery manufacturing. Oil may now be in its last boom period. Declining oil demand over the next decade is going to hit high cost producers like Alberta hardest. And the transition is only going to accelerate now with Putin's foolhardy invasion of Ukraine. There are going to be a lot of stranded assets in the fossil fuel industry in the not too distant future. Building more pipelines doesn't seem like the best idea with these trends happening. We need to be moving away from oil, not doubling down on it.

[hipster duck]

The energy crisis is very immediate, and major O&G projects don't really have the timelines to address this.

Doing some basic research on the Kitimat LNG project - a $40 billion project that also included the construction of a pipeline - it looks like it'll take around 13 years between the start of community consultations in 2012 and studies through to the opening of the facility in 2025. The construction portion was 2019-2025.

So any project proposed today of this scale would only come online in 2035, which is coincidentally the year when many major markets plan to have phased out ICE vehicle manufacturing completely.

[1ajs]

winnipeg used to have 2 refineries for what ever reason they tore them down in the 80's tank farms are still there

[WhipperSnapper]

The time to invest in our own refining and upgrading capacities has come and gone however, the time for exploration and efficient shipping to existing refining capacity is not yet over. These investments can become profitable in relatively short period. The world still employs coal for its energy needs. That was supposed to be nearly phased out by now. To say this will all be gone in 40 years is just a tad optimistic (as much as it would be a great thing for our collective future (but not Canadas))

[drew]

The entire global transportation system is still reliant upon fossil fuels, and there is nothing on the horizon that is going to change that, regardless of how many people change over to EVs.

Canada has a large amount of a (still) high value commodity in the ground that people are going to continue to purchase for many decades to come. There is also strategic value in a source of O&G from a reliable and secure place (a la Canada).

It would be foolish to not at least attempt to get some return on that commodity, and to future proof the Canadian economy from future disruptions.

[thebasketballgeek]

Originally Posted by WhipperSnapper

The time to invest in our own refining and upgrading capacities has come and gone however, the time for exploration and efficient shipping to existing refining capacity is not yet over. These investments can become profitable in relatively short period. The world still employs coal for its energy needs. That was supposed to be nearly phased out by now. To say this will all be gone in 40 years is just a tad optimistic (as much as it would be a great thing for our collective future (but not Canadas))

Canada has the capability to be an energy superpower in Nuclear and renewables we don’t need oil and coal to fuel our energy. BC, Quebec, and Manitoba are almost entirely on a renewable energy grid. Alberta and Saskatchewan are the sunniest places in Canada so there’s huge solar potential there as well.

Saskatchewan by themselves can be an energy superpower on par with any nation in the world because of all the different types of energy that can be produced in the province.

[Truenorth00]

I am cool with approving oil projects. At this point, they should be forced to post bonds for cleanup and wind down costs up front, so that the taxpayer doesn't get stuck with the bill when the energy transition inevitably turns most of them into stranded assets.

A 10-15 year project has a substantial amount of risk. Especially given how fast technology is progressing and how fast the cleantech industries are ramping. Taxpayers should not be forced to carry that risk in anyway, while shareholders suck up fat profits from temporarily high oil prices.

[casper]

Originally Posted by hipster duck

The energy crisis is very immediate, and major O&G projects don't really have the timelines to address this.

Doing some basic research on the Kitimat LNG project - a $40 billion project that also included the construction of a pipeline - it looks like it'll take around 13 years between the start of community consultations in 2012 and studies through to the opening of the facility in 2025. The construction portion was 2019-2025.

So any project proposed today of this scale would only come online in 2035, which is coincidentally the year when many major markets plan to have phased out ICE vehicle manufacturing completely.

LNG is different play than oil. Most of the LNG running through that facility will end up in Asia and used to power electric generating stations or some form of space heating. The move away from ICE may actually increase the demand for LNG.

These are long term projects. There are a variety of other benefits. Variety of improvements to the transportation network in the region. The terminal is going to run off the power grid instead of burning natural gas. That is going to provide some of the load for Site-C and for the first decade or two contribute to paying for that asset.

I do agree that industry working on a long time horizon.

[whatnext]

Originally Posted by swimmer_spe

Alberta has been upset that Keystone, Transmountain and Energy East pipelines have been canceled/halted, etc. All of these pipelines were to export oil from Canada. Canada does have the oil resources to be isolated from world market problems. Canada does not have the refineries to be insulated, so we must ship our oil to other countries to meet our demand.

I know that the politicians of Alberta will use this as a reason for pipelines.Maybe we should focus on ensuring we have the capacity to supply Canada with all it needs before we ship it elsewhere.

Guess we shouldn't have sold off PetroCanada after all.

[DoubleK]

Originally Posted by WhipperSnapper

The time to invest in our own refining and upgrading capacities has come and gone however, the time for exploration and efficient shipping to existing refining capacity is not yet over. These investments can become profitable in relatively short period. The world still employs coal for its energy needs. That was supposed to be nearly phased out by now. To say this will all be gone in 40 years is just a tad optimistic (as much as it would be a great thing for our collective future (but not Canadas))

This is bang on. Alberta is on track to have retired the last coal units by the end of 2023, only to be replaced with modestly better gas generators. It won't be long before the climate folks put pressure on them to move to non-emitting generation, likely long before the end of their economic life. That makes for a very different investment decision and will certainly lead to higher prices for consumers and industry in the near and medium term.

Sadly, coal use in the US has gone up 16% in the past year. As gas supply in Europe tightens due to the conflict in Ukraine, I would expect the coal use in Europe to increase year over year.

From a pure climate perspective, Energy East was the pipeline we needed with an LNG terminal in the Maritimes to get gas to Europe. That was a huge missed opportunity, especially when one considers the current state of the energy crisis in Europe.

The silver lining in all of this was the last time the world had such a severe energy shock in the 1970s, that was the impetus to get the current fleet of nukes built.

The answer to the climate question is not renewables. We need safe, reliable, cost-effective, non-emitting base load generation. That starts and ends with nuclear.

[Loco101]

Here's a link to information showing all of the oil refineries in Canada:

https://www.canadaaction.ca/canadian...sked-questions

I didn't realize that the Valero Jean-Gaulin refinery in Lévis QC has the second highest production capacity after the Irving one in Saint John NB.