Monday, April 30, 2012

Proposed oil sands pipeline map

From the article.
"Inside Climate News" has an interesting summary of existing and planned oil sands pipelines. They claim that current export capacity is set to triple to 3.1 million barrels per day, but at first glance it looks like they might be double counting oil that travels in one pipeline and then another.

Sunday, April 29, 2012

TransAlta and friends cancel carbon capture program

The Keephills 3 plant.
Photo by Bruce Edwards for the Edmonton Journal.
Last Thursday a $1.4 billion carbon capture program by TransAlta, Capital Power and Enbridge was cancelled on the grounds of it being uneconomic. "Project Pioneer" was supposed to capture carbon from a new coal plant, Keephills 3, west of Edmonton at a rate of a million tons per year for ten years. The project had received $800 million in provincial and federal government subsidies, most of which will now presumably be paid back.

Thursday, April 26, 2012

Small companies in the oil sands

The Globe and Mail has an interesting article on small businesses operating in the oil sands. They talk about three examples, a mechanical/steam truck/vacuum truck/water truck/other things company, a bus company and a construction company. It finishes with pointers on how to be a successful small oil sands company.

MEG releases first quarter results

MEG released its first quarter results, showing their production averaged 28,500 barrels per day, a slight increase over their first quarter last year. Profits had increased 18%, to $53 million, on lower costs and higher prices. Although it doesn't say, I would think a big part of that "lower cost" part is thanks to gas being so cheap.

Wednesday, April 25, 2012

Daniel Yergin, author of "The Prize" and chairman of IHS CERA, gave a lunch talk in Calgary calling for Alberta to better educate people and institutions in the US about the importance of the oil sands as a source of energy and the improving environmental performance of the industry. He said the industry and Albertan government should do more to dispel inaccurate portrayals, such as claims that oil sands operations are much more carbon intensive (he claims they release only 5 to 15% more carbon than conventional oil sources).

Cenovus releases first quarter results

Cenovus released its first quarter results today. Overall production has increased significantly over the first quarter last year. The Foster Creek property is producing roughly the same at about 57,000 barrels per day, however the Christina Lake property has increased almost three fold from 9,000 barrels per day to 25,000 barrels per day. These are all the numbers to Cenovus before royalties, and since both of the projects are 50/50 joint ventures with ConocoPhillips, by my very intricate calculations the two properties are producing at a total rate of over 160,000 barrels per day. The projects are two of the most successful SAGD operations in the province.

In other Cenovus news, the company is still looking for a JV partner in its Telephone Lake Project. UPDATE: The Calgary Herald has a more in depth look at the search for a Telephone Lake partner. In short, Cenovus is in no rush and wants to get as good a deal as possible, which may involve waiting for a partner that is willing to overlook the harsh differentials currently faced in selling bitumen.

Tuesday, April 24, 2012

Election Results!

The PCs defied earlier polling by taking home a strong majority in yesterday's election - they won 61 of the 87 seats. Their leader, Allison Redford, remains the Premier. The Wildrose party took 17 seats, the Liberals 5, the NDP 4.
As I mentioned on Sunday, I think this is good news for the oil sands. Redford has stressed cooperation with other provinces and the federal government, as summarized in this Financial Post article, as well as the importance of environmental programs and better educating the US and Europe on the impacts of the industry.

Sunday, April 22, 2012

Summary: Albertan party positions on oil sands

The Albertan provincial election is tomorrow, April 23. One of the issues the four parties are quite different on is proposed policy for oil sand development. Find a summary of these positions and my opinion after the break.

Friday, April 20, 2012

EU delays oil sand labelling vote

The EU has announced it will wait until after a detailed study to have member nations vote on whether to support their "Fuel Quality Directive". This means a vote is not expected until early 2013. Canada has lobbied against the directive because it labels Canadian oil sands as highly carbon emitting.

Thursday, April 19, 2012

Nexen gets approval to expand Long Lake

Photo from Global Forest Watch Canada
On Monday, Nexen announced it has received approval to expand its Long Lake SAGD operation. At 35,000 barrels per day over the last quarter, the project is not a total dog but is still producing less than half of what was planned. Nexen's 35% partner in the operation, OPTI, went bankrupt and was sold to CNOOC (a Chinese state controlled oil company) at a cut-rate price last year. People have speculated that Long Lake's crappy performance was one of the reasons Marvin Romanow stepped down as Nexen's CEO early this year. Nexen also recently failed to get its concession in Yemen renewed, which had increased pressure on Long Lake and other projects to be successful.