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Showing posts from January, 2016

FOUR REASONS DIVESTMENT DOESN'T WORK:

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Oil and Gas 101: THE DIVESTMENT CHALLENGE
What is the Fossil Fuel Divestment Movement? The fossil fuel divestment movement is an attempt to convince groups such as wealthy individuals, universities and major pension funds to divest themselves of financial assets in companies involved in fossil fuel extraction. It is being promoted by some environmental NGOs as a means to combat climate change. In Canada, 19 universities currently have a student-led divestment campaign. To date, only Concordia University has begun divestment of about $5 million from their portfolio. Some universities will be voting on divestment motions in upcoming months, and others have already rejected the idea, citing the benefit to students and all Canadians created by the energy industry.
THE ECONOMIC IMPACT OF DIVESTMENT: UNIVERSITY OF CHICAGO STUDY A study performed by Daniel Fischel (2015) of the University of Chicago Law School compared two hypothetical investment portfolios over a 50-year period: one tha…

EXPECTATION vs REALITY

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EXPECTATION AND REALITY by maryline vuillerod and jeff kralowetz It may seem intuitive that Canada could gain more benefit from its crude oil resources by refining them in Canada and exporting refined products. But this theory fails to account for the structure of global markets, constraints in infrastructure and geography, and trends in global demand for refined products.
THE STRUCTURE OF GLOBAL MARKETS  Any company considering investing $10 to $15 billion dollars in export refineries must take into account significant Asian growth that has been matched by rapid building and even over-building of refining capacity in China, India and the Middle East. Even there, refinery utilization has fallen. Any new Canadian refinery would enter a market in which capacity has been over-built and refinery utilization has been falling since 2006, particularly in the Organization for Economic Cooperation and Development (OECD) member countries. Source: IEA, June 2014 Medium Term Market Report: Market …

EVOLUTION vs. REVOLUTION

Mike Doyle is the President of the CAGC – the Canadian Association of Geophysical Contractors - representing the business interests of the seismic industry within Canada. The CAGC website may be found at www.cagc.ca.
It has been a tough couple of years. All of Canada is figuring out how closely it is tied to the price of oil and other resources. Our dollar is dropping, EI rolls are being hit in all Provinces, and our growth is slowing. We are absolutely moving to a lower standard of living. The Celebrity Circuit decries the greed of the Oil and Gas Industry which is allegedly ruining our world yet fails to appreciate where their wealth came from – on the backs of a culture with leisure time and excess money from a standard of living brought on by fossil fuels. On this note an interesting article follows:
EVOLUTION vs. REVOLUTION By Pierre Desrochers is an associate professor of geography at the University of Toronto. Magazine: Canadian Fuels Association - Perspectives – Fuel 2015

From wind…

Saudi Arabia: A Weak Kingdom On Its Knees?

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The great Kingdom of Saudi Arabia—the long-time dictator of crude oil prices for the world—is struggling on all fronts.

The Saudis are losing their proxy wars in both Syria and Yemen; their OPEC leadership is under threat; they are not winning the crude oil price war; and its long-running alliance with the West is in question.

From Saudi Arabia’s perspective, Iran seems to be gaining ground everywhere. Saudi Arabia has several weaknesses that help explain the current anxiety emanating from Riyadh.

1. Saudi Arabia losing its leadership in the OPEC
Saudi Arabia has been the default leader of OPEC; however, despite Saudi insistence to the contrary, the U.S. shale boom, increased Russian oil production, and a very resolute Iran are challenging this leadership.

The result is that Saudi Arabia now finds itself powerless in supporting oil prices. Instead of the much-needed production cuts, during the 4 December 2015 meeting, the OPEC nations refused to adhere to any ceiling, which has been th…

Why cheap gasoline is a setback for going green

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Konrad Yakabuski The Globe and Mail

Barack Obama can expect a hero’s welcome when he visits the Detroit auto show for the first time as U.S. President this week. The Detroit Three auto makers owe their current glory to Mr. Obama’s 2009 bailouts of General Motors and Chrysler and the domestic oil boom that occurred on his watch. Almost 650,000 U.S. auto jobs have been added since he took office. New-car sales set records on both sides of the Canada-U.S. border in 2015, after hitting near three-decade lows in 2009.
There is just one very big thing wrong with this picture. Mr. Obama’s grand plan for sparking a transportation revolution with hefty subsidies for electric cars and increasingly stringent fuel-economy standards has been entirely overwhelmed by surging U.S. oil production (and the resulting low gas prices) and consumers’ love of SUVs and pickups, which generate the highest profit margins for auto makers, but which consume the most gas and produce the highest carbon emissions.

Analysts Differ On Outlook For Oil Markets

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By: Pat Roche

Article originally published by the Daily Oil Bulletin on Jan 13, 2016. It can be accessed here: http://www.dailyoilbulletin.com/article/2016/1/13/analysts-differ-outlook-oil-markets/



The global oil glut will shrink in the second half of this year and supply will match demand in 2017, a top analyst expects. World crude production currently exceeds demand by about 1.5 million bbls a day, and that oversupply will continue during the first half of this year, but will drop significantly in the second half, predicts Mike Wittner, head of oil market research at Paris-based investment bank Société Générale S.A. “So the important thing is the second half is going to look and feel much different than the first half of the year,” Wittner told a Conference Board of Canada oil and gas conference in Calgary on Tuesday. He said statistics about oil inventories in Organization for Economic Co-operation and Development (OECD), which are more reliable than non-OECD data, tend to drive prices. …

Associations Face Uncertain Future

By: Mike Doyle, President, CAGC

2016 February Recorder article.


As I write this at the end of 2015 to be published in February of 2016 there is little to be optimistic about in our Industry here in Canada. Commodity prices remain low, our Governments are adding on more regulatory and environmental hurdles, and more stakeholder processes. The developed world has suggested (in principle anyway) a shift away from fossil fuels; however such changes will come at a cost to consumers (and tax payers) in the form of higher energy bills and additional costs such as carbon taxes. It seems obvious to me that as an interim step, the world needs to switch to natural gas as much as possible in the meantime as energy systems are slow to change, and often involve much cost. Even here in Alberta there is currently a moratorium on building windmills on crown land. So much challenge lies ahead. The uncertainty also lies ahead for Associations as we tend to be one line in someone’s budget and can be an eas…

Challenges Continue To Mount For Junior/Intermediate Oil Companies As Commodity Prices Lag And Policy Changes Add To Uncertainty

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By: Paul Wells

Article originally posted by the Daily Oil Bulletin on Dec 23, 2015. It has been altered slightly, and it has insight from EPAC President, Gary Leach. Original article can be found here: http://www.dailyoilbulletin.com/article/2015/12/23/challenges-continue-mount-epac-member-companies-co/



The Canadian oilpatch has witnessed a monumental shift this year in the political environment under which the industry operates, not only provincially in Alberta, but federally as well.
In essence, the climate change policy in Alberta has been sold by the government as necessary to secure pipeline approvals, and support generally for the industry, both on the national front and abroad.

To wit, while unveiling its new climate change strategy, the government received support on the stage from both environmental non-government organizations and some heavyweight industry CEOs. But will these new policies, in terms of oilsands emissions caps and planned methane emission reductions, achieve the…