Crude oil discount? Explain

[jazz]

In the last 15 yrs, Canada aggressively went into the sands while the US went hard in the Bakken in ND and other similar plays. Now those fields are still highly productive when prices are low. Efficiencies and new drilling techniques have made the US super competitive, while we still work like buggers trying to turn sludge into oil and move it thousands of miles.

Now the US is refracking those wells and making huge gains.

Our best bet it to abandon these big steam plays in the sands, forget about ever building a pipeline again cause thats done, developing more oil out of the Bakken like crazy, piping it up to Fort Mac for blending and then trucking the rest across to ND where large US pipelines originate.

Otherwise our industry is good as dead.

[jazz]

And on the otherside, the envirowhacko whoe dream of a world run by windmills and John Lennon songs, you are way off base.

This world is going to add another 3 Billion people, like it or not. Even if world birth rates fall to 2 kids per person, 3B is certain. And those people will want cars and refrigeration and tvs. Who is going to deny them those basics. We will expend much more energy just to feed those people. Fossil fuels will be a major mix for a long time yet.

[SASKFARMER3]

Wow, What a Liberal Spin Grass.

You Prove again you have no Clue on Anything that goes on in Canada.

Were you this Clueless back home.



It is the Fault of One Fool Justin Trudeau and if you lived here grass when his old man was running Canada you would understand how that fool almost destroyed this country. People hated him by the time he was done.

But as a New Canadian your just like the rest you believe JT is the Ultimate and the rest of us have it all wrong.

Yes, I voted for Ralph once. We hung in the same circles so if someone you're hanging around with is running and you get along with that person you support their choice. He was in opposition at that time.

But he knows this time I will not be voting for him and last time when Trudeau won I wasn't voting for him because I believed Trudeau was similar to his father and western Canada would be hurt.

But like all new Canadians, you'll blindly support a Trudeau till the end not realizing they don't give a rats ass about western Canada or Canada in General. Its all about being a Trudeau and power.

I think ill Believe in the Oil Markets a guy like Dan Who studies oil and gas for a living. Not some flunky who cuts and pastes.

[SASKFARMER3]

Jaz your Theory is not going to work because your shipping fracked oil and gas north then back south to the USA. So again wouldn't all this shipping make Canadian oil way more expensive than the oil out of the sand? Plus if you have no way to get a second or third buyer of the product wouldn't you be selling at a discount or fun with math would make that work also.

Just saying math is fun and some have no clue.

[jazz]

Just saying math is fun and some have no clue.

Well I think all options need to be looked at otherwise we risk stranded resources.

Would have to reverse one of the main pipelines. Yes it would cost to ship it back, but by simple blending, you would have a partially upgraded product already. You could dump some more to the co-op refinery maybe for further upgrading and the rest to US midwest refiners. Yes still one customer, but a better product.

[Oliver88]

Nutjob and Groper both opposed the NEB approved Northern Gateway.
Trudeau brought in new regulations to kill Energy East to the cheers of loons in Quebec.
TransMountain was bought for $4.5 billion by the Liberals so they don’t have to make a decision before next federal election......they could ram this through with legislation if they wanted.

CN, CP are moving record amounts of oil.

How will grain move once Alberta and northern Saskatchewan finish harvest?

[jazz]

Nutjob and Groper both opposed the NEB approved Northern Gateway.
Trudeau brought in new regulations to kill Energy East to the cheers of loons in Quebec.
TransMountain was bought for $4.5 billion by the Liberals so they don’t have to make a decision before next federal election......they could ram this through with legislation if they wanted.

CN, CP are moving record amounts of oil.

How will grain move once Alberta and northern Saskatchewan finish harvest?

I would forget about TMX ever becoming a reality. I would bet there are no shippers that will want to put a barrel of oil on a pipeline controlled by crazy carbon taxing govts and obstructing, ransom holding native bands and envirowhackos. I wouldnt do a drop of business with that entity.

[chuckChuck]

Steven Harper a came to power in 2006, 12 years ago. He failed to facilitate significant pipeline capacity increases.

Trudeau has been in power for just 3 years. He approves of Keystone and wants Transmountain built.

One has to wonder what credible business plan would suggest increasing oil sand production with large investment in a very cyclical commodity, before securing the ability of getting the product to market?

One thing we know for sure is, we can't rely on the USA to buy all our extra oil. Thanks to new technology for horizontal drilling and fracking of tight oil, the US is producing more and more of its own oil. That was a market shift that wasn't predicted.

The oil sands are some of the most expensive to develop, low quality oil in the world.

As a farmer I would not invest a large amount of my capital to produce grain on the lowest quality land and then wonder why I couldn't make money.

Some farmers and some of the oil industry often get sucked into to believing the high prices and good times are going to last forever. A quick look at history would tell you otherwise.

[jazz]

Steven Harper a came to power in 2006, 12 years ago. He failed to facilitate significant pipeline capacity increases.

Ahh chuck, what time is Butts coming over for dinner.

https://calgaryherald.com/opinion/columnists/corbella-trudeau-plain-wrong-about-harpers-pipeline-legacy Trudeau plain wrong about Harper's pipeline legacy

One of his projects was on the existing transmountain pipeline.

[chuckChuck]

Ahh chuck, what time is Butts coming over for dinner.

https://calgaryherald.com/opinion/columnists/corbella-trudeau-plain-wrong-about-harpers-pipeline-legacy Trudeau plain wrong about Harper's pipeline legacy

One of his projects was on the existing transmountain pipeline.

Did the NEB review Line 67 under a previous Liberal government of Paul Martin? I expect it was applied for under Martin if Harper approved it in 2006 as he just came to power with Minority government in 2006. In any case I stand corrected on Harper and pipelines.

But I stand by my main point that the oil sands were and are on shaky foundation of poor economics because they are expensive to develop and prone to losing money during periods of low prices or even average prices.

Unlike conventional oil they take many years to develop production which increases risk. And unlike conventional wells, it is much more expensive and difficult to shut them down to reduce production because the investments are so large.

If prices of any commodity fall because of over supply or bottlenecks in getting the product to market the last thing you want to do is spend a lot of money producing more.

The long term political and economic risk of building pipelines are some of the factors that should be part of every business plan assessment.

[SASKFARMER3]

So chuck you think you actually know more than a guy whose main job is studying the Oil industry.

Were screwed because of your idiot Trudeau its that simple even a liberal should get it by now.

[chuckChuck]

So chuck you think you actually know more than a guy whose main job is studying the Oil industry.

Were screwed because of your idiot Trudeau its that simple even a liberal should get it by now.

I have never voted Liberal, unlike you who voted for Goodale.

I am a casual observer just like you, except I don't start every observation with a tiresome political rant against a party you once voted for! LOL

And I would never invest in the oil sands because I think they will become a worthless stranded asset as new sources of energy are developed and implemented.

[grassfarmer]

Jaz your Theory is not going to work because your shipping fracked oil and gas north then back south to the USA. So again wouldn't all this shipping make Canadian oil way more expensive than the oil out of the sand? Plus if you have no way to get a second or third buyer of the product wouldn't you be selling at a discount or fun with math would make that work also.

Just saying math is fun and some have no clue.

The #1 person with no clue around here is you - you mean you don't realise the whole point of fracking shale gas is to get the fluids to thin the tar sands product so it'll travel down the pipe to the gulf coast? Did you really think the big expensive that goes into fracking was to produce the low price natural gas? How would the math work on that oh clueless one?

[jazz]

Investment in all sectors of canadas energy profile are warranted. Sands, fracking, light sweet, NGL and even offshore and even renewables and nuclear and hydro as well. We have huge potential in all sectors, but none should fully replace any others until the market warrants it.

But I agree with chuck that the oil companies went too much into the sands. And the Liberals overreacted trying to target them as well. Much more production came out of ND in the last decade than the sands.

[grassfarmer]

Much more production came out of ND in the last decade than the sands.

Not in oil it didn't - about 2.8 million bpd versus 1.25 million bpd at peak in ND.