Friday, 30 December 2016

Can we TRUMP The Status Quo?

By: Mark Scholz
Published: Oilfield Pulse


       As 2017 approaches, the Canadian oil and gas industry is part of the national conversation like few times in our history. Our responsible, ethical, world leading industry is at risk of being permanently damaged by an orchestrated attack from radical environmentalists. Over the past decade, millions of dollars have been spent by well-organized, media savvy ENGOs to position Canada's oil sands in popular culture as the focal point of climate change, dirty oil, and corporate greed. They have managed to place several of their key representatives, such as Tzeporah Berman and Gregor Robertson, in important government roles in Western Canada and are now using taxpayer dollars, in addition to their considerable private funding, to drag the Canadian energy industry through the mud in front of the world.
      Ironically, at the same time, Canada's oil and gas industry continues to lead the world in responsible and ethical production. The oil sands itself has seen a 30% reduction in carbon emissions per barrel since 1990, demonstrating the industry has been working on carbon reduction even before carbon reduction was cool. All told, Canada produces less oil per day than the state of Texas alone and amounts to 1.6% of global greenhouse gas emissions. Canada uses the royalties from the sale of oil and gas to fund hospitals, schools, and parks, and the industry itself provides approximately 500,000 Canadians with jobs. Canadian technology and regulations for things like pipelines are used around the world as models of best practices in oil producing areas, and Canadian trained engineers, geologists, and rig workers are highly sought after. Yet, in our own country, there continues to be a very vocal, emotional, and prominent group of people who want to shut our industry down.
       As Vivian Krause points out in her recent article, The Great Green Election Machine, it would appear Canada has been duped. Our country's greatest virtues -- selflessness, charity, responsibility, compassion -- have all been taken advantage of using misinformation and celebrity culture to the point where Canadians are fighting amongst ourselves over a problem the rest of the world seems to have, based on their actions, bestowed on Canada and Canada alone.
      Yes, many countries came together to ratify COP21 in Paris in 2015. Since then, however, the United States has lifted a 40 year ban on oil exports and built 16,000km of pipelines. China, while trying to reduce its dependence on coal, continues to build new coal facilities at a rapid pace. Germany, a country praised for its renewable energy policies, is moving back to natural gas in many areas due to high costs and inefficiencies in wind and solar. Nigeria continues to allow the uncontrolled release of methane from its production facilities. Saudi Arabia, the world's wealthiest oil producer, continues to see class and wealth inequality on a scale unheard of in Canada. The actions do not match the words.
      There is a role for Canadian oil and gas in global markets, even though the world will continue to shift toward renewable and lower carbon energy forms and as clean technology evolves over the coming decades. Canada's role should be to offset and displace environmental laggards in oil and gas production not be shut down from participating altogether.
      In 2017, we are forecasting a modest increase in the amount of wells and a WTI price of between $40-$60 USD. Given the climate described above, the Canadian oil and gas industry has a uphill battle ahead even with a recovery in the price of oil. The recent election of Donald Trump in the United States, however, could be seen as a huge opportunity for Canada. Trump has stated, on multiple occasions, his support for Keystone XL and favoured approving the pipeline within his first 100 days of President. Our Prime Minister should be using his first meeting with the new President to reinforce Canada's support for North American energy security, which requires Canadian oil to have greater access to the US market. Keystone XL would provide an additional one million barrels per day of Canadian crude to the US and significantly reduce current price differentials. It would mean better profits for Canadian governments, and more jobs for Canadian workers.
     Additionally, the election of Trump should force the federal and Alberta government to reconsider their position on carbon pricing. The new Trump administration and Republican controlled congress will likely move the United States away from Obama's commitment to the Paris Agreement on climate change or, at the very least, significantly slow its progress. As a result, Alberta's new carbon tax will no doubt push capital away from Canada toward oil and gas investment opportunities south of the border.
      Contrary to what our detractors would like us to thing, the oil and gas industry is not dying. The International Energy Agency (IEA) forecasts the world will consume almost 40% more energy by 2040, and fossil fuels will make up 75% of the energy mix. This energy growth will be driven, almost entirely, by the emerging economies of Asia, the Middle East, Africa, and Latin America, which are home to more than four-fifths of the world's population and a rapidly expanding middle class.
      In 2017, there are huge opportunities for our sector, but in order to realize these opportunities, a few things must happen. First, federal, provincial, and municipal governments need to seriously address business competitiveness in the face of incredible changes in American politics. They must accept our industry is important and recognize it is crucial in providing jobs and tax revenues for all Canadians. They must start treating our industry, and the people and families who rely on it, with respect. They must understand Canada's role in transitioning toward whatever the future of energy may be. They must realize transitioning from a position of financial strength and technical ingenuity will enable us to continue to be an energy leader able to produce, consume, and export affordable, reliable energy so we do not become an energy follower forced to rely on others for supply and paying prices we have no control over. They must approve pipelines and allow our world-class products to be sold on the world market for the benefit of everyone involved.
       Secondly, Canadians who support and understand our world-class oil and gas industry must work hard to share the truth about what we do. Rather than dying, our industry is evolving, improving, and staying competitive as it always has. We must work hard to show the rest of the country and the world why we are the best and why our industry is so important to our quality of life and high standard of living. We need to be unapologetically proud of what we do and not let our detractors continue to carry the conversation.
       The status quo will not provide Canadians with a strong economy and high paying jobs nor will it encourage them to stand behind our industry with support and compassion. The year 2017 can be year that sets Canadian oil and gas apart for what it really is. Let's work together to make it happen.

Tuesday, 20 December 2016

National Suicide

By: Darrell Stonehouse, Editor
Published: Oilweek - JWNENERGY

     
      The election of Donald Trump as the U.S. president has a lot of Canadians smugly looking down on our neighbours to the south, believing they have made a grave error in judgment.

      But rather than wallowing in arrogant condescension, Canadians should be taking a sober look at what Trump's election means for Canada's economy because if the new president carries through on his stated plans, we could be in big trouble.
      The Canadian economy is already uncompetitive versus the U.S. Labour productivity statistics bear this out. For every hour of work in 2012, the U.S. produced $52 of value, compared with $42 of value for Canada.
      Trump, if he walks the walk and isn't just another politician, is set to further roll back the regulatory state and taxation rates that act as a brake on productivity growth. He is set to cut federal corporate tax rates from 35 per cent to 15 per cent, freeing up capital to be invested in  productivity-growing technologies. He has also pledged to cut the regulations that hamper growth, including environmental and land-use regulations.
      There has been a lot of focus on whether a Trump government will walk back the current government's pledge to bring in a tax to limit carbon emissions. It is almost a certainty he will. But he is also going to open up more land to resource development and reduce the red tape that slows development. He is going to invest an expected trillion dollars in real physical infrastructure that could increase productivity.
      Meanwhile, here in Canada, we are headed in the opposite direction.
      Taxes are going up, taking potential capital investment to improve productivity out of circulation. The carbon tax is one example. In 2014, Canada produced 732 million tonnes of CO2. When the proposed federal carbon tax reaches its peak of $50/ tonne in 2022, it will siphon $36.6 billion annually out of the private sector that could have been invested in productivity growth.
      And we continue to add more and more regulations that add costs and slow economic growth that can pay for productivity gains. First Nations, who represent around four percent of Canada's population, basically have a veto on resource development. When development is finally green-lighted, there are usually hundreds of conditions put on it that eat up investment capital.
      These are some of the reasons the Canadian economy is already 18-20 per cent less efficient than the U.S. economy. If Trump carries through on his plans to get government out of the way of investment, this productivity gap will likely grow. The value of the Canadian dollar to the greenback generally tracks productivity. Right now it is at 75 cents.
      Any anti-Trumpers want to wager where it will be four years from now?


Thursday, 15 December 2016

Here Comes Trudeau's Carbon Cops

By: Jordan Bateman
Taxpayes Federation
Published: Fort Nelson News


           Justin Trudeau's climate change plan just keeps getting worse for Canadians.
    It's bad enough that he is forcing British Columbia to hike its carbon tax by 60 percent, while the rest of the world rejects the idea. Reliably Democrat-loving Washington State voted down a carbon tax last month and US president-elect Donald Trump has already ruled out a national tax. Australia and France have scrapped their carbon taxes. We're boldly going where no one else is bothering -- all to address our miniscule, 1.65 percent share of global carbon emissions.
    Now Trudeau is bragging about the bureaucracy his plan will beget. The government plans to unleash thousands of carbon cops across Canada. Buried in a 209-page document of environmental red tape to be discussed by Trudeau and the provincial premiers this weekend are a dozen words that will cost taxpayers millions: "Compliance and enforcement will create thousands of new jobs across the country."
     That's right - thousands of new government employees, paid by your tax dollars, policing carbon emissions and making sure people are installing double-glazed windows, driving less, and following the hundreds of other policies in the report. Or, if these new compliance jobs are forced on the private sector, it will mean higher consumer prices and housing costs. Pick your poison, Canadians: higher taxes or higher prices.
     Amazingly, this is listed in the report by the Trudeau government as an economic benefit.
     The climate patrol is referenced in a section on energy-efficient building codes. The report itself admits that adopting such a code will trigger a "20% increase over average commercial construction costs." (The section also applies to high-density residential, so it's safe to presume the same cost hike will apply to condos.)
      Again, that will drive up the cost of consumer goods and services, and housing. Any suggestion that these buildings will make up for that initial expense with lower energy costs is wishful thinking - Vancouver's natural gas ban will force people here to use much more expensive electricity to heat the buildings. There will be no savings - just more costs for consumers.
      This 209-page report is staggering in its impacts, costs, red tape and pure ludicrousness. Taxes, fees, levies, government intervention in agriculture, transportation, construction, reducing forestry: it's all there, right down to red tape restricting the diets of methane-spewing cattle and new government rules on how to manage farm manure.
      You can see why Trudeau will need a climate police bureaucracy to enforce all of this. There won't be a single part of life that won't be more expensive and more difficult.
       Contrast that with Australia. Our friends down under brought in a carbon tax in 2012 and repealed it two years later. During that time, it cost the Australian economy $16 billion and four political party leaders lost their jobs over it - this according to Chris Berg, a senior fellow with Australia's Institute of Public Affairs, who spoke in four Canadian cities this week as part of a Canadian Taxpayers Federation tour.
       "We were told we would lead the world, but it didn't look like the world was interested in carbon taxes," Berg told Postmedia editors in Calgary. "The idea that anything we in Australia could do to make a legitimate impact on climate change was fairly ludicrous... Climate change is a global problem, not a regional problem."
       Berg is right. The rest of the world aren't interested. And neither Australia, with 1.5 percent of the world's emissions, or Canada, with 1.65 percent, is going to make any difference.
      It's time for Trudeau and the premiers to scrap this plan for higher taxes and more red tape before they do irrevocable economic damage.

Monday, 5 December 2016

“HUBRIS” A Hard Look At Climate Change


Preface

Imagine a movement so bent on achieving its political objectives that it is willing to corrupt science to meet them. Imagine governments around the globe, first adopting and then promoting this official science for more than two generations. Imagine that they are willing to use their regulatory power to implement a massive program of social engineering in order to “save” the planet. Imagine the United Nations leading this movement and insisting that a global effort is required. Imagine the movement’s leaders believing that people around the globe must change their eating, heating, cooling, lighting, toilet, transportation, manufacturing, entertainment, even housing habits and reject values that are critical to their prosperity, happiness, and welfare, confident that humans can adapt and revert to simpler, more primitive, more local lifestyles, have fewer children, and embrace lives presumed to be more in harmony with nature.

Imagine thousands of scientists engaged at public expense in developing a convincing rationale for this unprecedented project. Imagine that these scientists are willing to compromise their integrity in pursuit of the role of a single factor that they insist controls the most complex and chaotic earth system, a molecule – carbon dioxide – that is literally the building block of all of life. Imagine that they believe that by reducing its miniscule – .04 percent – presence in the atmosphere, the planet will cool and climate will stabilize at an optimum level, a level seen only in micro-seconds of geological time. Imagine scientists who dismiss the work of hundreds of their colleagues and believe that their work must be suppressed. Imagine a scientific movement dominated by greedy grant farmers and cheered on by the media, insisting that there is no further need to study the science and that governments need to start implementing its preferred policy of worldwide social engineering. 

Imagine that many leaders of this movement believe that the world’s population needs to be thinned down to a billion people within a generation or two. Imagine that some of the movement’s most revered leaders, even as they advocate that ordinary people must curb their consumption and live simpler lives, pursue lifestyles that consume more energy and other commodities in a year than an ordinary family of four would need over its lifetime. Imagine a movement whose leaders habitually dissemble and mislead and justify this on the claimed greater good they are pursuing. Imagine politicians, civil servants, scientists, activists, and the media flying from one exotic location to another as they plan what must be done to coerce changes in our lifestyles, even to the point of sacrificing human freedom and democracy. 

Most thoughtful people would conclude that only Hollywood could come up with such a bizarre plot. A little more thinking, however, and they might connect the dots. There is such a movement, and it has demanded our attention for more than thirty years. It has devoured billions of dollars in public money and has inserted its menacing tentacles into every aspect of modern life. The UN and all its organs are the leading force behind it, but most governments of the world support it in one way or another. Elites, the media, and even religious leaders, have embraced it, even though they seem poorly informed and ignore its demands while urging others to adopt sharply reduced lifestyles. 

The public face of this science, climate science, is part of a worrying new trend: the emergence of “official” or consensus science. In this perversion of real science, policy becomes the goal of scientific enquiry rather than its result. Over the last thirty years and more, public policy has focused increasingly on dealing with risks to health, safety, and the environment. Much of that policy ostensibly relies on scientific findings. In their decision-making, governments increasingly look to scientists and have resorted to funding science that meets their political need for certainty. Consensus on controversial issues is critical to governments. Ever since Rachel Carson published Silent Spring in 1962, activists have stood ready to convince governments of all manner of risks to humanity and nature, and scientists have obliged by reporting findings that satisfy activist political needs. Once governments acquiesce, it is critical that scientists not undermine their decisions with awkward new findings. Public policy is not easily reversed. The result is a potential monster spewing out more and more regulations, presumably making us safer and healthier and safeguarding the environment, but also substituting social for personal responsibility, reducing freedom and choice, and creating an ever larger, more costly, and intrusive public footprint. 

For many years it seemed that the public agreed that there was a need to take action to control the globe’s climate, but that support has steadily eroded as people have begun to realize the enormity of what is being demanded, the flimsy ground on which this demand is based, and the impact of what would need to be imposed. Public support has declined further as sceptical scientists have pointed out more and more problems with the underlying scientific hypothesis, as engineers have indicated the extent to which purported energy substitutes are not up to the job,  and as economists have calculated the enormous costs and minimal benefits. Only general scientific illiteracy has kept the project afloat. 

                The movement advocates fundamental changes in lifestyles and succeeds by spreading alarm based on the alleged adverse consequences resulting from human-caused (anthropogenic) changes in the climate system. The movement points to the prospect of catastrophic results if those changes are not imposed by public authorities. Alarmism best describes this phenomenon. Critics of the movement are characterized as sceptics because their criticism is grounded in scepticism of various aspects of the science, the economics, and/or the politics of climate change alarmism. Some alarmists refer to sceptics as deniers, a term used in the pejorative sense. Sceptics do not deny climate change or the role of greenhouse gases (GHGs). As explained further in the scientific chapters, many sceptics consider the role of anthropogenic GHGs to be relatively minor and the prospect of catastrophic changes to the climate to be minuscule, thus obviating the need for anything other than appropriate adaptive measures.

This book dissects the global warming/climate change movement in all its ramifications. It analyzes the evolving science of climate change and places its pursuit and findings within the broader context of modern scientific praxis, identifying its strengths and weaknesses and areas of agreement and disagreement. Unlike the popular meme that the science of climate change is settled, the book demonstrates that in proper scientific practice, no issue is ever settled; scepticism is at its heart. Climate science is no exception. The book further argues that, as with other ambitious UN agendas, from the New International Economic Order (NIEO) of the 1960s to sustainable development in the 1990s, embrace of these movements by governments has a predictable life cycle, starting slowly, building momentum, and then gradually fading as a more realistic appreciation of the issues intrudes. While the primary movement is withering on the vine, its effects linger for generations. Governments may never meet the primary objectives of the global warming movement, but they have succeeded in embedding many of its tentacles into public regulatory policies and programs. Multiple interests have become dependent on these policies and will fight to maintain them, including thousands of officials whose careers are wedded to them. As so often happens in public policy, the unintended and harmful consequences become accepted practice, despite their costs and annoyance.

 The world will be a better place when governments agree to tame this monster and refocus their energies on issues within their competence; when religious leaders and other elites accept that they have fallen prey to a movement whose motives are much darker and more damaging than they realize; and when the media adopt a more balanced approach and provide the public with the critical assessment that is often missing from their reporting. It is time for all three to accept that the UN is pursuing a path that can only result in a less prosperous and more divided world. 



 Author: Michael Hart

Friday, 2 December 2016

Mayor's Letter to BC Citizens

"USA stops importing Canadian oil and gas"


Dear British Columbia Citizens,

That is not a current headline but it could be. What would happen to our economy if it was?

I would like to talk to you about energy, pipelines and our natural resources. I am a mum and a grandma and I have lived in the north all my life. I am also the Mayor of Fort St. John --- right smack in the middle of one of the world's largest supplies of oil and gas. I live in a region surrounded by pipelines, wells, hydraulic fracturing (fracking) sites and canola and wheat fields. I have eaten the food we grow here and I drink our water. I understand what it takes to extract our natural resources and what it takes to protect our environment. I live it.

I don't want to try to convince you of anything but I would like to share with you what I know to be true. I strongly encourage you to do some of your own research. Learn more than what you read in a tweet or a Facebook post. I have added some links to reliable resources below for you.

Where does the petroleum we all use every day come from? Canada has some of the largest petroleum resources in the world and yet Canada imports 634,000 barrels of crude oil from foreign countries every single day. That is $26 BILLION of oil imports every year that we could have supplied to ourselves. That product arrives in tankers and is transported t where it needs to go by truck and train right through our communities. And yet we don't want our own product to flow in pipelines to our communities for our own use or tow our ports so we can export it? That just makes  no sense at all to me.

So let's talk about pipelines. I know pipelines are a safe, cost-efficient means of oil and natural gas transportation and emit fewer greenhouse gases than alternate transportation methods. Canada has 830,000 kilometers of pipelines. Three million barrels of crude oil is transported safely every single day. B.C. has over  43,000 kilometers of pipelines. if we took that oil out of the pipelines, we would need 4,200 rail cars to move it. How many of those cars would you like rolling through your community? Between 2002 and 2015, 99.9995% of liquid was transported through our pipelines SAFELY. You probably spill more when you fill up at the gas station.

I understand you don't want tankers floating down our beautiful B.C. coast. But did you know the USA has been shipping up to 600,000 barrels a day of crude from Alaska to the Puget Sound through the Salish Sea for the last 20 years? Did you know that B.C. has a Tanker Exclusion Zone that has been respected for years? That zone stipulates that full tankers must travel on the west side of the zone but those that are not transporting goods can stay inside the protective zone. Other than one natural gas pipeline, Vancouver Island receives all of their petroleum by barge every day. I don't remember ever hearing anyone complain about that. According to Transport Canada over 197,000 vessels arrived or departed from west coast ports in 2015-1487 of them were tankers. 400,000 barrels of crude oil is safely transported off the B.C. coast every single day. Sooo..... I think we are OK there.

Emissions? 80% of the emissions associated with fossil fuels are generated in their combustion -- not their extraction and transportation. If you want to do something about our reliance on fossil fuels then address the demand for them not the transportation of them. Change starts with consumers not industry. A large part of the demand for them not the transportation of them. Change starts with consumers not industry. A large part of the demand for fossil fuels in B.C. is transportation. 33% of our fossil fuels are used to operate cars, trucks, planes, and trains and ferries. If we switched all of that over to electricity we would need not just one Site C dam but 15 of them. Which communities do you want to flood to provide the energy for your electric cars? Remember I live 7 km from Site C dam so I have a pretty good understanding of them.

I love this quote from Blair King an Environmental Scientist and Writer:

"We live in a world where all the work we do to reduce our greenhouse gas emissions in B.C. can be undone with the flick of a pen in China or India. No matter what we do, those developing countries are going to get electrical power to their populations -- if not with LNG, then with coal; and if not with B.C. LNG, then with lower-intensity (read:dirtier) LNG from on of our competitors. In both cases the end result is higher global GHG emissions than if B.C. LNG was used."

He is telling us to look outside our province and see the impact we can have o n GHG on our planet. Our LNG is cleaner than the stuff already on the market because our regulations are tougher and we emit far less GHG in our production than in other countries. Our natural gas industry is committed to continuous improvement.

I understand that you are concerned about safety. I am too. In Canada we have some of the strictest safety requirements in the world. Canada's oil and gas producers are continuously improving the safety of their operations and transportation of their products. Emergency Response Plans are customized for each community, covering key areas such as public safety, protection of community infrastructure, and a clear plan of action with local emergency responders. And we have the B.C. Oil and Gas Commission to oversee B.C. projects and the National Energy Board oversees the larger multi-jurisdictional projects.

The Oil and Gas Commission is our provincial agency responsible for regulating oil and gas activities in British Columbia, including exploration, development, pipeline transportation and reclamation. Core responsibilities include reviewing and assessing applications for proposed industry activities, engaging with First Nations, cooperating with partner agencies, and ensuring industry complies with provincial legislation and all regulatory requirements. International delegations come to B.C., as world leaders, to learn how we have partnered environmental protection with resource extraction. I think the Oil and Gas Commission does a good job protecting the interests of citizens.

Many of you have concerns about the rights of our Indigenous Peoples. I will not speak for them but I will provide you with a quote from Stephen Buffalo, president and CEO of the Indian Resource Council:

"I think industry is willing to be a partner (with First Nations). They want to come with the First Nations together. We are depending on these pipelines for the success of the Canadian economy."

Here is the link to the full article: http://business.financialpost.com/news/energy/pro-oil-first-nations-seek-end-to-pipeline-gridlock?_Isa=f499-1f26

So let's talk about the economy. B.C.'s energy sector offers some of the largest provincial economic opportunities in a generation. It is estimated that, in 2010, 11.2% of the provincial exports came from the natural resource sector. That was over $21 billion worth. Canada's oil and natural gas sector contributes $1.5 billion to the provincial government but it is estimated that it could go as high as $2.4 billion per year. This is money for health care, education and infrastructure. The resource sector is the foundational stone upon which the B.C. economy was built, and it is as important today as ever.

440,000 Canadians are employed because of the oil and gas sector. A recent study by Philip Cross, former chief economic analyst at Statistics Canada, shows the huge economic value of the natural resource industry in B.C., and in particular the Lower Mainland. Cross' report demonstrates that over 55 percent of resource-related jobs and income (direct, indirect and induced) flow to the Lower Mainland. This means those workers contribute to our economy by renting or buying homes, buying groceries, enjoying a quality life and shopping their local businesses.

Let's lead the world in resource extraction, continuous improvements and long term planning.

Let's be leaders in reliable and renewable energy development.

Let's support Canadian industry and stop buying foreign oil.

Let's grow our economy by meeting our domestic needs and exporting our abundant resources.

Let's live well now and in the future.

Thank you for taking the time to be an informed citizen.

Sincerely,

Lori Ackerman,
Mayor of the City of Fort St. John

Published: Vancouver Sun - November 20, 2016 (A16)