JT's rationale behind blocking Alberta’s oil...

[Rosemary1]

JT is a master at giving non-answers to direct questions - a trait of most politicians.

[Pat-Taporter]

http://www.youtube.com/watch?v=aDDJeM5R4PM

[erinmore3775]

Depending on your point of view of Prime Minister Trudeau you can either find that his government supports Alberta and Newfoundland oil and pipelines or is dead set against them. However, I have been following Canada's energy policy for over ten years and I find that at this point in time this government is more supportive of Canada's oil producers and pipeline companys than the previous government. Unfortunately, the current government is being cast in the shadow of nearly 30 year old PET National Energy Policy.

Even "the Rabble.ca" is afraid the the current government has abandoned its environmental principles and embrace big [/url]

http://rabble.ca/blogs/bloggers/brent-patterson/2016/04/trudeau-preparing-to-approve-trans-mountain-and-energy-east-p

"The prime minister has never been an advocate of a Canadian future without oil. He supported the Keystone XL pipeline, and explicitly stated that no country that found 170 billion barrels of oil would leave it in the ground." That is true.In January 2014, Trudeau stated, "I am ... very interested in the Kinder Morgan pipeline, the Trans Mountain pipeline that is making its way through. I certainly hope that we're going to be able to get that pipeline approved." And in December 2014, Trudeau commented, "The [Energy East] project has still not attained the level of support it needs to go forward. I hope [TransCanada] will develop a means to reassure and demonstrate that this can be done in a responsible fashion.
"Earlier this year, in response to statements by Alberta premier Rachel Notley and Ontario premier Kathleen Wynne in supporting of getting oil to overseas markets, Trudeau commented: "I am very much in the camp of both premiers, Wynne and Notley, who demonstrated that Canada can and should work together on economic issues for all of us. ...I'm feeling very good about our capacity to get our resources to market in a responsible and environmentally sustainable way."

It is also important to note that the following statement reflects government policy.

"It is also notable that just days after being sworn in as the Foreign Affairs minister, Stephane Dion stated, "We support [the Energy East project] but we want that to be done properly and it will be difficult to do if we don't strengthen the process itself, the process of consultation with communities and the process of scientific environmental assessment." Dion, who chairs the powerful Environment, Climate Change and Energy cabinet committee, has also commented, "We believe in development but it must be sustainable, including for the oil sands. It's a challenge but we'll do it with the industry, with the province of Alberta, we'll do it altogether, we have no choice."

The greatest opposition to the Energy East Pipeline appears to be Canada's Natives. " The Mohawk nation is threatening to do everything legally in its power to block the Energy East pipeline project, calling it a threat to their way of life. Despite perceptions opposition to the project is harboured mainly by mayors in Quebec, a Mohawk-driven Canadian First Nations movement against the project is picking up steam in other parts of the country.

“Indeed an alliance of indigenous nations, from coast to coast, is being formed against all the pipeline, rail and tanker projects that would make possible the continued expansion of tar sands,” Simon writes.“One thing for sure, we the Mohawks of Kanesatake will not be brushed aside any longer and we wish to press upon you that we reserve the right to take legal action if necessary to prevent the abuse of our inherent rights.”


http://montrealgazette.com/news/quebec/mohawks-threaten-to-block-energy-east-says-project-is-threat-to-their-way-of-life

The development of a NEW Canadian National Energy Policy is too important to simiply have us, that is all Canadians both Native and non Native, play the Trudeau Government blame game. It is time that we all worked together to simultaneously develop and transport our petroleum resouces in a safe and less environmentally damaging way along with the development of "green" energies. It is also important to understand that both petroleum based and "green" energies have effects that can damage the surrounding flora and fauna. However, at this time the most important consideration must be how we can develop energy sources that economically support all Canadians and offer long term energy sustainability. Simply bashing Trudeau, either PET or JT does not accomplish this desirable outcome.

EDITED to correct Rabble url reference, thank you Smoke!

[hobbyguy]

Plus in all of this, the practical and pragmatic reality is that building export pipelines will almost require the army to be mobilized. There are sooo many constituencies that Harper and Oliver further alienated by spying on them and calling them names. That makes a rationale compromise very difficult, if not impossible. But then, the corporations involved, and Alberta politicians have pretty much stated that there is no compromise, it is their way and to heck with anyone else.

Simmering behind that is another issue. Essentially, during the oil shortages and crisis of PET's era, Alberta said "let the eastern *bleep* freeze in the dark". Geee... I wonder if older folks in Ontario, Quebec etc.

On top of that, Alberta politicians have regularly and with gusto sneered at Quebec and other provinces (whom they now need on their side lol) about equalization "payments". Little mention of course, by those Alberta politicians about the huge subsidies the oil and gas industries get from the federal government (depending on how it is calculated, somewhere between $2.74 billion and $18 billion [that high one is really a stretch]) - much of which directly benefited Alberta.

Harper and Oliver calling folks in BC eco-nuts and tree-huggers and worse doesn't help. It simply makes BC residents aware that flatlanders who don't know port from starboard have no clue about the dangers and complications of tanker traffic. Harper and crew made that perception worse with their ill advised closure of the Kits Coast Guard station, and the ill advised closure of the Vancouver marine traffic control station. It makes no sense to reduce to your ability to respond to and control marine situations when you are trying sell folks on more tanker traffic. The horse-hockey with Kinder Morgan and the Burnaby parkland issue is no help either, nor is the Harper NEB decision to NOT give BC refineries priority on the existing K-M pipeline, and allow K-M to switch that pipeline to dilbit - which BC refineries can't handle.

It is no wonder that the BC government has set conditions that the corporations involved and Alberta do not wish to meet. Those conditions are really "minimum code" but the industry and Alberta have refused to abandon their "our way or the highway" approach.

So it isn't JT that is blocking Alberta "oil" (it's mostly bitumen - not "oil") - in point of fact it all boils down to the Alberta approach - which has been "screw everybody else" since the 1970's. Karma is a harsh mistress, and Alberta has generated a lot of bad karma, and the Prime Minister of Alberta generated a whole lot more bad karma.

[Pat-Taporter]

Yep, ya can’t just pump it and pipe it like the good ol’ days when we had a ‘jack’ in our schoolyard. And getting an ‘upgrade’ doesn’t apply to school, either, although someone might have to try ‘sucking up’ to the ‘teacher’ for the increase in production.

Also it looks the ‘practical’ aspect of Quebec seems to be on board—with no hard feelings, so far.

For help with the essay:

Canadian Encyclopaedia

http://www.thecanadianencyclopedia.ca/e ... e/bitumen/

Bitumen

One of the easiest ways to understand bitumen is to compare it to its cousin, conventional crude oil. Whereas conventional crude oil flows freely, bitumen does not. At room temperature it looks like cold molasses, and must be either heated or diluted before it flows. Like all petroleum, both conventional crude and bitumen are made up of hydrocarbons (i.e., organic compounds containing only carbon and hydrogen. However, compared to conventional crude oil, bitumen contains more carbon than hydrogen, as well as many more impurities, such as nitrogen, sulphur and heavy metals. In order to produce synthetic crude, these impurities must be removed and the carbon-hydrogen imbalance corrected.
. . .

Bitumen Upgrading

After the bitumen is extracted from the oil sand it still requires extra processing, or upgrading, before it can be sold to refineries and turned into products such as fuel. Upgrading is done by coking the bitumen, hydro-processing it, or a combination of the two. . . .

Calgary Herald

Quebec businesses told to do better job of promoting Energy East Pipeline

The Canadian Press
04.11.2016

http://www.calgaryherald.com/business/q ... story.html

TORONTO - Quebec businesses have not done a good enough job promoting the economic benefits the Energy East project would bring to the province, the president of Quebec Manufacturers and Exporters said Tuesday . . ..

[erinmore3775]

Rather than trying to find blame, perhaps we should be trying find commonalities. I would like to think that the current governments in Alberta and Ottawa have more in common than differece when it comes to energy/petroleum policy. They even have some things in common with Suzuki. Consider this from one of his major energy statements.

" To be seen as truly ethical when it comes to energy policy, Canada must slow down tar sands development, clean up the environmental problems, implement a national carbon tax, improve the regulatory and monitoring regime, and make sure that Canadians are reaping their fair share of the revenues. We must also start taking clean energy [seriously]."

http://www.davidsuzuki.org/blogs/science-matters/2011/02/it-will-take-more-than-rebranding-to-make-tar-sands-oil-ethical/?gclid=CMG2vKbskcwCFciIfgodidMD-Q

The new Alberta budget targets a carbon tax, maintains the current petroleum royalty scheme, encourages the reduction of Alberta's reliance on coal fired electricity production, and supports the development of diversity of the petroleum industry by applying carbon tax revenue. These items suport or at least lean toward supporting many of Suzuki's ideals.

http://www.alberta.ca/budget-highlights.cfm

It is time that we examined some of the ideals that Norway has put in place and will allow them to ride out the downturn in oil prices. These include a revision of the royalty payments. However, we should also consider the following...

" Alberta should then require all bitumen to be refined in the oil sands and they should take an equity position in the refinery. If the bitumen is refined in Alberta, it would mean, for example, that the Northern Gateway and Keystone pipeline would not need to be built. Twin pipelines would not be needed to send back the natural gas condensate so that bitumen can be diluted in order to travel in a pipeline." We should also shouldbe considering building a new refinery in the east to process oild from Newfoundland.

http://credbc.ca/norways-oil-gas-policy/

I believe that if the provinces and the federal work with the petroleum industry there are ways to promote and encourage future petroleum based energy development while improving environmental safety. By bringing all parties to the table, including Natives, there is the possibility of developing a secure Canadian oriented energy policy that is environmentaly friendlier and reduces Canada's carbon footprint.

[hobbyguy]

Make no mistake, I am in favor of finding ways to maximize the number of good jobs for Canadians from petroleum related activities. That does rule out exporting dilbit - which is precisely all the industry has put on the table at this time.

I have also said, from waaay back, that the bitumen should, at minimum, be upgraded in Alberta. Oddly enough, that put me in line with what Harper said during the 2008 election campaign (which of course, he promptly reneged on). Harper changed tunes immediately when the NGP application was put forward.

IF we go the route of replacing imports with Alberta bitumen, which could be structured to create lots of jobs in Alberta and lots of jobs in eastern Canada, I can see that as a way past the objections. Perhaps joint ventures with First Nations for some of the production facilities to make it a win-win-win, if they are interested.

IF, for example, the Mayor of Montreal was faced with a proposal where new jobs, new revenue, and reduced tanker traffic were rolled into one - I am sure the folded arms would become open ones.

[fluffy]

Make no mistake, I am in favor of finding ways to maximize the number of good jobs for Canadians from petroleum related activities. That does rule out exporting dilbit - which is precisely all the industry has put on the table at this time.

Bitumen and diluted bitumen account for roughly one quarter of the petroleum leaving Alberta these days. There are currently five upgrading facilities running in the province (with one more under construction) processing bitumen into synthetic crude. In addition there are a handful either approved for construction or undergoing the application process, likely to remain in limbo until the oil price gets higher.

The biggest problem facing the industry is that production is outpacing the ability to get the product to market. There is also the thought that being able to send Alberta oil east or west will expand our customer base away from its current dependence on the US market, a relationship fraught with political forces far beyond my understanding.

[hobbyguy]

That assessment is somewhat at odds with the information I found. Although the number stated was a projection to 2020, and is a touch out of date, it was that only 47% of the bitumen production would be upgraded, down from 58% in 2010.

http://www.huffingtonpost.ca/2012/05/23/canada-oil-refineries_n_1539701.html

"Meanwhile, in Alberta, the Energy Resources and Conservation Board estimates that the percentage of bitumen that will be upgraded to light oil in the province will drop to 47 per cent in 2020, down from 58 per cent in 2010"

That is a decent summary article. It points out that Canada has gone from 40 refineries in the 1970s down to 19... and the reason no new refineries are being built:

"And because of the increasing complexity of the forces shaping the global oil industry -- and a lack of will on the part of government and industry to do so -- it has only become more challenging to enter that domain."

My bold.

Notley (belatedly in terms of Alberta leadership, but finally) seems to be pushing the "value added" button. Perhaps if JT and the eastern premiers can come together around that, there could be something very positive.

[Pat-Taporter]

Alberta oil products are heavily discounted on the world market. Has anyone ever crunched the numbers to compare how Canada would fare if we used them domestically first—exclusive of imports?

[fluffy]

That assessment is somewhat at odds with the information I found. Although the number stated was a projection to 2020, and is a touch out of date, it was that only 47% of the bitumen production would be upgraded, down from 58% in 2010.

I'd be a little suspicious as to whether or not those figures still apply since the article was written in 2012. A major shake-up in the industry and a couple of significant changes in government have changed the big picture significantly. Still, it is clear that there is more on the table than dilbit exporting as your prior post stated.

[fluffy]

https://apps.neb-one.gc.ca/CommodityStatistics/ViewReport.aspx

Here are some figures current to the 4th quarter of 2015, note that the figures are for the whole province, not just the oilsands.

While I agree that the thought of "exporting jobs" is, in principle, doesn't do much to keep Canadians at work, we shouldn't lose sight of the fact that dilbit exports account for jobs as well. There is also the idea that with Canada being a net exporter of petroleum products there really shouldn't be a need for imports, but again what is holding that up is the pipeline infrastructure necessary to get the product to the east.

New upgraders, beyond what are already in the works, are a hard sell these days as crude prices aren't offering up the extra cash needed to make the projects viable. It's a safe bet that as soon as there is some money in it for the industry developers that it will happen.

[Boda]

https://apps.neb-one.gc.ca/CommodityStatistics/ViewReport.aspx

Here are some figures current to the 4th quarter of 2015, note that the figures are for the whole province, not just the oilsands.

While I agree that the thought of "exporting jobs" is, in principle, doesn't do much to keep Canadians at work, we shouldn't lose sight of the fact that dilbit exports account for jobs as well.

The link didn't work for me, however I suspect the figures referring to the percentage of "upgraded" exports based on all Alberta oil production versus percentage of "upgraded" oil from tar sands may contribute to explaining the discrepancy between Fluffy's 25% figure versus the 47% figure presented in HG's link?

What I don't understand is how your accurate assertion that harvesting of dilbit for export accounts for Canadian jobs reflects on the proposal to upgrade more dilbit prior to export?
Doesn't the value added proposal to upgrade dilbit simply contribute more jobs for Canadians?

To my way of thinking "value added" anything is a good long term economic growth strategy. Opposition to it is generally introduced by those seeking short term profits. I also recognize the need to protect amicable trade agreements and the advantages garnered from sovereign trading partners. Thus the need for prudent government policy implementation to encourage value added industry protecting Canada's long term interests while maintaining healthy trade relationships.

[hobbyguy]

Probably at the heart of this whole issue are a bunch of geopolitical issues, and some macroeconomic ones.

1. Under NAFTA we basically gave up the right to say "we don't want to ship raw product, we want to ship value added product". So inch by inch, we have gone from 40 down to 19 refineries, and imports have risen.
2. The TPP will make that worse.
3. The Saudis are seeing the writing on the wall. North American and European demand for refined product is forecast to decline. Asian markets, especially China, are the only markets forecast to grow significantly. Thus you see the Saudis wiggling their way into a more controlling position in China, by forming joint ventures to control as much of the refined product production as they can. The Russians are not far behind...
4. CERI did a study of greenfield refining of dilbit to produce diesel (the best use for dilbit). Their conclusion was that such a refinery requires $85/bbl oil based on the WCS discount. $85/bbl is possible in the future, but unlikely. That study did not examine the possibility of upgrading in Alberta and refining using currently mothballed refineries, nor did it study adding upgraders to mothballed refineries. I suspect those scenarios might move the breakeven down to say $70/bbl.
5. North American markets are gasoline heavy, which is not the best use for dilbit, and have been disrupted by shale oil, which is a superior product for gasoline production. Refracked shale oil is lower cost than SAGD dilbit.
6. Country after country is signing onto the GHG emissions reduction goals of the recent Paris talks. Dilbit is more GHG intensive than competitive true crude oil products.
7. While crude oil spill "clean up" technology is actually not great, at least it is somewhat effective when applied to conventional crude spills. The American Academy of Sciences report on dilbit spill clean up is problematic. It recommends immediate evacuation of the surrounding area due to the toxic nature of the quickly evaporating diluent. It states that conventional clean up booms etc. are only effective for a very short period (hours) before the diluent evaporates off and the bitumen starts to sink. Burning doesn't work because the diluent burns off first, and the bitumen sinks. Similarly dispersants are ineffective. Once it sinks, the bitumen is very sticky and clings to everything, making further recovery extremely difficult - which is why the Kalamazoo river had to be dredged. The Academy also indicated that long term toxicity of the bituem is higher than conventional crude. All of that, plus the dangers of diluent transport going the other way (highly toxic and explosively flammable) make dilbit an extremely high risk proposition for marine regions where it is to be transported.

Trying to make sense of that is really going to be one heck of an issue.