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Guest Post: Are Canadian Oil Policies Misguided?
Submitted by Daniel Graeber of OilPrice.com
Are Canadian Oil Policies Misguided?
The provincial government in Alberta is mulling new rules that would require the oil industry to cut greenhouse gas emissions tied to oil sands production by as much as 40 percent per barrel. The measure may be part of the federal government's push to allay Washington's concerns about the Keystone XL pipeline. Some of the concern surrounding the production of oil sands, the type of oil designated for the controversial pipeline, is that it's more carbon intensive to produce than conventional oil. Alberta's government has expressed concern that it won't be able to meet its emission targets without new rules, though some in the oil industry may be already ahead of the game. While emissions may be part of the debate over the controversial cross-border pipeline, a financial analysis suggests the Canadian government is looking in the wrong direction.
Alberta Premier Alison Redford was in the United States last week trying to shore up support for the Keystone XL oil pipeline. The U.S. government hosts a town hall meeting in Nebraska later this month to vet public comments on a draft environmental assessment from the State Department. That report found that, overall, the environmental threat from oil sands production would remain with or without the pipeline. The Canadian government, however, is under pressure to find ways to allay some of those environmental concerns to move the project forward.
A law that went into force in 2007 requires companies exploiting the vast oil sand deposits in the country to cut their emissions by 12 percent of their base level and put around $15 into a technology fund for every ton they go over that limit. Calgary officials say it's important not only for the provincial government, but for the federal government as well, to let Washington know it's serious about the environment. Part of the controversy over Keystone XL is tied to emissions, so it's imperative that Canadian Prime Minister Stephen Harper sets the right tone as the pipeline conversation gains momentum.
Norwegian energy company Statoil, however, suggested last week it wasn't waiting around for the legal process to sort itself out on emissions. In 2012, the company said it increased its oil sand production by 60 percent while at the same time cutting its CO2 intensity by more than 20 percent. While part of its stewardship, like tree-planting and land reclamation, may be just good public relations, it said it aims to cut CO2 intensity by 25 percent by 2020 and reach the 40 percent mark five years later. Regional Vice President Stale Tungesvik said Statoil would continue to work to improve not only its oil recovery, but its carbon footprint as well. Statoil plays no direct role in the Keystone XL pipeline.
A report last week from the Canadian Imperial Bank of Commerce finds that while Keystone XL would be a boost for oil sands trade, it's just "one of several important pieces of the puzzle for Canada's energy sector." The CIBC World Market report finds that, with U.S. shale oil production competing for the same transportation networks, the Canadian government needs to capitalize on emerging Asian economies, not U.S. trends, if it's expected to realize the full benefits of its oil riches.
"The world will still need Canada's crude, given still ample demand growth ahead for Asia, and we doubt supply-demand conditions will permanently sustain prices below Canadian project break-evens," said CIBC Chief Economist Avery Shenfeld. "But it's increasingly important that Canada move on one or more of the alternative pipelines to get our product headed Asia's way."
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The spill in Arkansas from the 1940s era rusted out pig-iron pipeline is proof of a desparate need for modernization. It is important to note that this "disaster" is on the enormous scale that 2 guys with modern vac trucks could clean it up in a couple of days. The real disaster is solar, wind and hydro which permanently scar the landscape. By the time the oild sands are cleaned of their oil literally millions of acres of uninhabitable wastelands will become pristine wilderness.
Do you really believe the crap that you post?
I seriously have my doubts...
Family has worked in patch for some time. Reality is not anything like the greenpeace version.
Solar and wind and other things have their place. The critical error is central "green" planning and subsidization. QUIT MISALLOCATING CAPITAL. LET MARKETS WORK.
Yes, let's discount the cost of frying the planet from using fossil fuels, not to mention the direct tax breaks that the FF industry gets... Are you aware of depletion allowances and how they work?
We aren't "frying the planet." Turn off the television mockumentaries and think critically.
I'm well aware of depletion allowances.
Given that I have a Ph.D. in physics I think I have that "think critically" thing covered...
Whereas you seem to live in LA-LA land.....
Perhaps between solving wave equations you might consider watching the excellent 2011 German horror movie "HELL". It will give you an newer and more reliable source of climate change predictions.
I have a Ph.D. too. It doesn't help credibility. Who greases your palm? Do you have a real job?
I'm a 20 year veteran of computer software engineering contracting with several clients with lots of work. My formal education is a BSc in CS with with physics and Math minors. I am the only one in my large family not connected with O+G. Outsiders trying to kill the careers of my sons and nephews really piss me off... Unless his PHD has been directly studying these carbon effects from measurements he personally controlls he is likely trusting data too easily corrupted by big money and new age religious types.
Slavador: I was addressing the other guy, who apparently won't be back. Cockroaches avoid light.
Compliments to you and your family for your part in productive society. May Agenda 21 crash and burn like the evil thing it is.
An expert relative in the patch read my cocky Arkansas post and corrected me. He figures 23 guys with vac trucks for a week! I stand corrected.
I heard the comparison of using tar sands to wringing out a dirty dishrag for the water content. If you are really desperate, it could work. need to do more research.
So the Hosers are sending our oil to Asia, eh? Now you know why we have drones policing the Canuck border.
The Urban Canadian slum dwellers have too much time on their hands due to a free 8 hours every day when they don't go to work. They gravitate towards extremist causes that aim at making everyone as idle and miserable as them. It is ironic that if they succeed in shutting down industry their subsidized housing, skytrains, universities and free food will dry up. I recommend they all move to Western Europe where everything is green and deadbeats are paid extra well...
You forgot to mention the horses and donkeys that run around freely ....
There are not that many equines left in Canada off of private property as the many Asian and Italian immigrants find them delicious..
Delish Indeed! I don't know why the Brits are pitching such a hissy-fit about dining on Mr. Ed when their mince would otherwise be unaffordable.
Slavador seems to be losing it.
How about a Keystone .... gravity powered .... conveyor belt .... or how about mixing it with crushed rock .... and paving roads with it ?
Cougar-w,
Why don't you just sell all your shit made out of plastic, sell your other worldly goods, delivered by petroleum burning transportation, stop eating produce that was harvested by tractors, strap on a loin cloth and preach your neo-Luddite tripe to a group of like minded idiots somewhere else. If you were so gifted with 'critical thinking skills' maybe you could paint that on your chest in some archaic script like some kind of hippie merit badge. Dipshit!
Yeah, lets stop to live in an American world.
Oh wait.
Signed: an American.
Yeah, lets stop to live in a Chinese citizenism world.
In Vancouver.
Signed: AnAnonymous
Yeah, let's stop to squat in a Chinese citizenism world.
The roadsides beckon.
Signed: AnAnnoyingUs