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Canada Petroleum Producers Cut 2030 Output Forecast

The Canadian Association of Petroleum Producers cut its 2030 oil production forecast by 17 percent as capital expenditures slipped after crude prices tumbled. The world’s third-biggest holder of crude reserves will produce 5.3 million barrels a day, down from 6.4 million forecast a year ago, CAPP said. The organization cut its forecast after oil dropped to $42 a barrel this year from near $108 in June as the Organization of Petroleum Exporting Countries maintained quotas amid a surge of U.S. shale oil. The drop has curtailed capital expenditure by oil and gas producers to C$45 billion ($36.5 billion) in 2015 from C$73 billion last year, CAPP said. Expenditure in the oil sands fell to C$23 billion this year from C$33 billion. “Companies are reverting to expansion of existing projects,” said Greg Stringham, a vice president at the Canadian Association of Petroleum Producers. “As far as new projects, those are […]

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Canadian Oil Sands Resume Output as Wildfire Threat Recedes

CALGARY—Two major Canadian oil sands operators said Monday they have resumed output at sites that had been shut down by a more than two-week old wildfire in northern Alberta, which exports much of its crude oil production to the U.S. The blaze had shut-in nearly 10% of Canada’s oil sands output, or about 233,000 barrels a day, since it was first detected on May 22. Canadian Natural Resources Ltd. CNQ -2.32 % said it expects to resume full production later this week at its 80,000 barrel-per-day Primrose site, which had been evacuated and shut down, and its 30,000 barrel-a-day Kirby South operation, which was forced to cut output due to the temporary closure of a pipeline. Cenovus Energy Inc. CVE -3.28 % said it began ramping up production at its 135,000 barrel-per-day Foster Creek site over the weekend, but didn’t provide an estimate for when output levels would return […]

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Canadian oil exports by rail fall

Canadian crude oil exports by rail down by more than a quarter year-on-year, federal data show. Photo by Steven Frame/Shutterstock CALGARY, Alberta, June 3 (UPI) — Canadian crude oil exports by rail for the three months ending in March declined by more than 25 percent year-on-year, federal data show. The National Energy Board updated data on total crude oil exports by rail , showing an average 119,755 barrels per day were shipped for the three months ending in March. That’s down 24 percent from the three-month period ending in December and 27 percent less than the same period in 2014. Though rail shipments have declined recently, the volume delivered through March 2015 is six times greater than the volume delivered for the three months ending March 2012, data show. North American crude oil production has increased to the point that it’s more than the existing pipeline infrastructure can handle, […]

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Western Canadian Wildfires Shut in Oil Sands Production

CALGARY—Wildfires that have crimped Alberta’s oil sands production for more than a week continue to burn, officials said Monday, dealing another blow to producers already spooked by low crude prices and expected royalty increases. Some 1,400 firefighters in northern Alberta—including hundreds from neighboring provinces—have been working to douse or corral dozens of wildfires which have raged for several days, spread by strong winds and dry underbrush in the boreal forests that dominate the landscape. Of 35 blazes currently being fought, five have yet to be contained, including the largest which has engulfed nearly 80,000 acres in the province’s northeast, said Richard Horne, a spokesman for the Alberta Agriculture and Forestry Ministry. “Our crews are still working around the clock to get the fire under control and build a perimeter,” Mr. Horne said, adding that light rain and milder winds over the weekend helped firefighters extend a fire proof zone […]

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Alberta Wildfires Burn For 6th Day, 10% Of Oil Sands Crude Offline

CALGARY, Alberta, May 28 (Reuters) – Firefighters battled wildfires in northern Alberta, Canada’s biggest crude-producing region , for a sixth day on Thursday, with two blazes near oil sands facilities still out of control. The wildfires have forced producers in the Western Canadian province, the largest source of U.S. crude imports, to shut in 233,000 barrels per day of crude production, around 10 percent of total oil sands output. The biggest fire, on the Canadian military’s Cold Lake Air Weapons Range, had grown in size to 20,000 hectares (49,000 acres) from 17,000 hectares on Wednesday. That blaze has forced Cenovus Energy Inc and Canadian Natural Resources Ltd to shut down production and evacuate staff from their Foster Creek and Primrose oil sands projects. Janelle Lane, a wildfire information officer at the Alberta government, said the fire had advanced to roughly 15 kilometres (9.3 miles) away from Cenovus’s Foster Creek […]

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Alberta fires threaten oil installations

More than 30 new blazes erupt in Alberta as energy companies report key installations under threat. File photo Heinz Ruckemann/UPI CALGARY, Alberta, May 28 (UPI) — Wildfires are moving closer to key oil installations in Alberta province as the government reports nearly three dozen new outbreaks in the last 24 hours. The provincial government in Alberta enacted an open-fire ban amid a persistent threat of wildfires. The government expects hot, dry conditions to continue at least through the end of the week . "In the last 24 hours there have been 33 new wildfires," the provincial government said in its latest update. "The wildfire outlook in Alberta continues to be severe." Since April 1, more than 600 wildfires have been reported , charring more than 32,000 acres of land. As of late Wednesday, there were 63 active wildfires in the province and 13 are out of control. Canadian energy […]

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Hundreds more oil sands staff evacuated on Alberta fire threat

CALGARY, Alberta Statoil ASA, MEG Energy Corp and Cenovus Energy Inc evacuated hundreds of workers from three oil sands projects in northeastern Alberta on Tuesday as wildfires raged through the key crude-producing region. The latest evacuations are in addition to project shutdowns by Cenovus and Canadian Natural Resources Ltd over the weekend, as companies rushed to remove staff from potential danger. At least 233,000 barrels per day of oil sands production, 9 percent of Alberta’s total oil sands output, have been suspended because of the fire risk, though none of the projects have been damaged. The Alberta government said there are 70 forest fires now burning in the province, with 20 considered out of control. Lightning storms are forecast for Tuesday evening, increasing the risk of more fires, a government spokesman said. Cenovus evacuated all 90 staff from its Narrows Lake oil sands project on Tuesday, which is not […]

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After a Political Reversal in Alberta, ‘Anything Seems Possible’

Photo Rachel Notley, leader of the New Democratic Party in the Canadian province of Alberta, at the ceremony in Edmonton on Sunday in which she was sworn in as the province’s premier. Credit Topher Seguin/Reuters EDMONTON, Alberta — This is the Canadian province known for oil, cowboys and rodeos, and as the adopted home of Prime Minister Stephen Harper , whose Conservative Party has long dominated politics. So it seemed especially jarring when a boisterous crowd in this bastion of conservative voting known as Canada ’s Texas celebrated its new premier this weekend: a woman regarded by much of the country as a leftist who vows to take on big oil and champion the poor. The 51 newly elected New Democratic Party members who sat behind the premier, Rachel Notley, their leader, in the swearing-in ceremony on Sunday did not resemble typical revolutionaries. Largely political novices, they dressed like […]

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Crude-Oil Exports to Canada Kept U.S. Gulf Coast Storage Hubs Below Capacity

Crude-oil exports to Canada provided a crucial relief valve for U.S. producers this year, according to a new report from data provider Genscape Inc. Almost 19 million barrels were shipped from the U.S. Gulf Coast to Canada’s eastern coast from the beginning of the year through early May, according to Genscape. Without those shipments, storage terminals in Corpus Christi, Texas, would have run out of capacity by now, according to the report, which is slated to be released on Wednesday. Though federal law prohibits exports of most U.S. crude oil, there is an exception for shipments to Canada. As production in the U.S. and in Canada has increased in recent years, more oil has criss-crossed the border, allowing both countries to import less crude oil from outside North America. Growing U.S. oil output has raised concerns among traders that some storage locations could reach full capacity. If an area […]

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Canada oil group vows to strengthen industry

Canadian oil group pledges to work to make the industry stronger than ever in the evolving energy market. Photo by Heather Snow/Shutterstock CALGARY, Alberta, May 15 (UPI) — The oil and gas industry in Canada said it was ready to work with the incoming provincial government in Alberta to strengthen a sector hurt by low oil prices. The Canadian Association of Petroleum Producers announced it would form an industry group to work alongside Alberta Premier-elect Rachel Notley to advance their interests in the oil-rich province and all of Canada. The Canadian National Energy Board said it was monitoring crude oil prices as U.S. oil production gains push markets toward the supply side. Low energy prices means less spending on exploration and production and Kevin Brin, director of the Canadian oil sands division at consultant firm IHS, said in a February interview a potential slowdown in Canada was a reflection […]

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Slump in Oil Prices Could Drag Calgary, Edmonton into Recession

An empty lot ready for a newly built house is for sale in Calgary, Alberta, April 7, 2015. Reuters The slump in oil prices is altering the economic pecking order among Canada’s major cities, pushing cities in oil-rich Alberta from the top to the bottom, the Conference Board of Canada says. The Ottawa-based think tank says Calgary and Edmonton, which have led Canada’s cities in growth over the last several years, will fall into recession . Oil is Canada’s biggest export and the big drop in prices for that commodity is expected to be a net negative for Canada’s economy. But oil production is concentrated in the western provinces and in offshore drilling in the Atlantic off the coast of Newfoundland and Labrador. As a result, those areas are much more vulnerable to the economic pressures created by lower oil prices, while the manufacturing-oriented economies of central Canada could […]

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Trican Well Service Cuts 2,000 North American Jobs

Trican Well Service Ltd., headquartered in Calgary, reduced its North American workforce by approximately 2,000 as a result of cost-cutting measures initiated in late 2014. The global well service company reported its 1Q results for 2015 Tuesday, which included 26 percent decrease in consolidated revenue from 1Q of 2014. According to the report, the company’s Canadian operations generated 1Q revenue of $222.7 million and operating income of $7.8 million for 2015, compared to $353.3 million and $62.5 million, respectively, for 1Q results in 2014. Its 1Q Canadian results were “negatively impacted by reduced customer activity caused by low commodity prices.” There was a sharp decline in activity levels in late February that remained low throughout the remainder of the first quarter. Similarly, U.S. operations generated $201.4 million, a 41 percent decrease from a year prior, in revenue for 1Q of 2015. The report cited “a weak U.S. operating environment […]

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Encana Books Impairment Charge of $1.2 Billion in 1st Quarter

Factoring out a $1.2 billion impairment charge and other items, the Calgary, Alberta-based energy company’s operating earnings tumbled 98%, but still came in ahead of analyst expectations. Encana, which has worked to shift its focus to oil and gas liquids assets and away from natural gas , said liquids production jumped 78% from a year earlier to about 120,700 barrels a day. “We are well positioned to benefit as oil prices rise,” Chief Executive Doug Suttles told analysts on a conference call. Overall production, however, averaged about 430,100 barrels of oil equivalent a day, down from 536,100 barrels a day a year earlier. It said the drop reflects the sale of lower-margin assets and its shift to a higher-margin, liquids-weighted production mix. It also came amid a slump in global crude prices that has led the company to slash the number of active drilling rigs from 44 in November […]

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Investors Urged to Avoid Oil Sands After Alberta Election

Pipelines run toward oil storage tanks stand at the Enbridge Inc. Cushing storage terminal in Cushing, Oklahoma. Energy suppliers cut about $126 billion of expenditure following last year’s price drop of almost 50 percent, estimates Wood Mackenzie Ltd., an Edinburgh-based consultant. Photographer: Daniel Acker/Bloomberg Investors may want to steer clear of oil sands developers and coal producers and buy royalty stocks and companies with assets outside Alberta. That’s the advice of portfolio managers and analysts after energy stocks declined Wednesday following the surprise election victory by the New Democratic Party in Alberta. An index of Canadian energy companies plunged the most in three months after the win by Rachel Notley’s NDP, which has pledged to boost corporate taxes, review the government’s royalty rates for energy producers and phase out coal power. Canadian Oil Sands Ltd. is among the most exposed to a potential hike in royalties and stricter environmental […]

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Oil Slump Drives Election Upset in Canadian Province

ENLARGE Alberta NDP leader Rachel Notley vowed in her victory speech Tuesday to put an end to the ‘boom-and-bust roller coaster’ of tying provincial finances to the fortunes of its oil patch. Photo: dan riedlhuber/Reuters CALGARY—The long-serving center-right government of Canada’s oil-rich Alberta province became the first major Election Day casualty of slumping global oil prices, as a left-leaning government swept to power in a vote that shocked Canada’s political establishment. Alberta’s Progressive Conservative Party, which has governed the western Canadian province since 1971—the longest-serving governing party in Canadian history—fell to a distant third place in Tuesday’s election, behind the leftist majority and a resurgent right-wing opposition party. The upset by the New Democratic Party threatens to slow investment and development in Alberta’s oil patch if companies dial back in anticipation of new regulatory hurdles or costs. Alberta’s once-roaring economy has already ground to a virtual standstill, with real […]

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Canadian oil trains shift to carry less-volatile crude

CALGARY, Alberta (Reuters) – A growing share of Canadian oil-by-rail traffic is made up of tough-to-ignite undiluted heavy crude and raw bitumen, say industry executives, as companies scramble to cut expenditures with the price of crude down more than 40 percent since June. By eliminating the cost of diluting with ultra-light condensate, heavy oil offers rail shippers an opportunity to claw back a few dollars per barrel in transportation costs. Official data does not break down the different Canadian crudes shipped by rail but interviews with industry executives suggest undiluted heavy and raw bitumen shipments now make up roughly a quarter of the estimated 200,000 barrel per day (bpd) oil-by-rail market. An added bonus is that heavy crude and bitumen are far less combustible than the Bakken and Canadian synthetic crudes involved in fiery crashes that spurred the Canadian and U.S. governments on Friday to tighten safety rules for […]

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Alberta Tory Dynasty at Risk as Voters Seek Change

Alberta, home to Canada’s vast oil sands, is preparing for a political shake-up for the first time in a generation as voters head to the polls Tuesday with surveys showing the Progressive Conservative’s 44-year dynasty may be coming to an end. Premier Jim Prentice is seeking to extend his Conservative party’s reign with a 13th-consecutive majority. Polls show the Tories, as the party is known, trailing Rachel Notley’s New Democrats and the right-leaning Wildrose under Brian Jean. An NDP victory may weigh on oil company earnings and share prices as the pro-labor party has pledged to raise corporate taxes and review the royalty payments made by producers, said AltaCorp analyst Jeremy McCrea. Prentice, who has led the province since September, called the early election just days after releasing a March budget designed to loosen the government’s reliance on oil revenue by increasing taxes on income, gasoline and alcohol. The […]

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Left-Leaning Party Sweeps to Power in Canada’s Oil-Rich Alberta

ENLARGE Supporters of the Alberta New Democratic Party cheer as election results come in at election headquarters in Edmonton on Tuesday. Photo: Dan Riedlhuber/Reuters CALGARY—The longtime ruling party of Canada’s energy-rich Alberta province lost its four-decade hold on power on Tuesday, ushering in a left-leaning government that has pledged to raise corporate taxes and increase oil and gas royalties. The Alberta New Democratic Party swept enough districts to form a majority, taking most of the seats in both the business center of Calgary and the provincial capital of Edmonton, according to preliminary results from Elections Alberta. The outcome was a blow to Premier Jim Prentice’s Progressive Conservative party and one that threatens to roil the province’s economy amid a slump in energy prices. “We need to start down the road to a diversified and resilient economy. We need finally to end the boom-and-bust roller coaster that we have been […]

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Fallout of Energy-Price Crash Spreads to Towns Far From the Oil Fields

ENLARGE The former fishing town of Burgeo, shown here, is one of a number of Newfoundland towns feeling the slump as many of its workers can no longer find work in Canada’s oil fields thousands of miles away. Photo: ALISTAIR MACDONALD FOR THE WALL STREET JOURNAL BURGEO, Newfoundland—Glen Hann and his wife traveled from Newfoundland to western Canada’s oil fields eight winters in a row, returning to this former fishing town in the spring with income they could never hope to earn closer to home. Then, this past December, Mr. Hann’s employers told him to stay home. Mr. Hann is among the thousands of Newfoundlanders who have traveled west over the past decade to work in Canada’s booming oil sands, a trek that has become one of North America’s longest commutes and has supported communities in some of Canada’s poorest eastern provinces. Now, falling oil prices are putting an […]

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Canada Not Aligned With U.S. on New Oil Train Brake Requirement

May 1, 2015 1:53 p.m. ET By Paul Vieira OTTAWA–Canada refrained on Friday from immediately matching a new U.S. brake-system rule for trains carrying dangerous goods, saying more discussion with the domestic rail industry was required. The rule, which would require trains be equipped with an expensive electronic brake system by 2021, was unveiled in a joint announcement in Washington by Canadian Transport Minister Lisa Raitt and her U.S. counterpart, Secretary of Transportation Anthony Foxx. Ms. Raitt said she has asked government officials to work with Canadian industry "to determine a Canadian solution" that harmonizes with a final U.S. braking rule. The new rule, part of a set of regulations aimed at harmonizing tankcar standards for both countries, would require trains with 70 or more tankcars loaded with a flammable liquid to operate with an electronically controlled pneumatic braking system. This feature is costly, but is said to provide […]

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Nova Scotia calls explorers to frontier territory

Nova Scotia issued calls for bids for frontier territory, noting energy companies may be taking the long view in a weak crude oil market. Map courtesy: Canada-Nova Scotia Offshore Petroleum Board HALIFAX, Nova Scotia, April 30 (UPI) — A petroleum board for the province of Nova Scotia aims to bring explorers to frontier territory, touting geological prospects over short-term economics. The Canada-Nova Scotia Offshore Petroleum Board issued a call for bids for nine frontier prospects as part of an annual bidding round that’s just five years old. Nova Scotia’s government estimates there may be as much as 120 trillion cubic feet of natural gas and 8 billion barrels of oil offshore. At least two of the nine parcels up for grabs have proven oil and gas potential, though neither has yet been considered viable for commercial development. The call for bids comes as energy companies are spending less on […]

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Canada’s crude oil exports reached record high in January

Canada’s crude oil exports set a monthly record with an average of 3.11 million b/d in January, the country’s National Energy Board reported. The total was 12.8% higher than a year earlier and 80% higher than January 2010. Volumes exported to the Gulf Coast “increased significantly” in 2014, in part due to commissioning of several pipeline projects. NEB said the Gulf Coast holds significant long-term potential as a market for western Canadian crude oil, particularly heavy grades. Conventional oil production has seen “moderate growth” in recent years, but is expected to decline this year due to lower oil prices, NEB said. Increased demand for domestic crude in Canadian refineries since 2011 indicates that oil sands production is driving crude oil export increases ( OGJ Online, Mar. 31, 2015 ). Related Articles

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TransCanada Asks U.S. Permission for New Pipeline Amid Keystone Delay

WASHINGTON— TransCanada Corp., the Canadian energy giant behind the Keystone XL pipeline, is asking the U.S. government to permit a new and different pipeline project. The Calgary, Alberta–based company filed an application with the State Department on Wednesday to receive a presidential permit that will let it construct a 200-mile pipeline across the U.S.-Canadian border, according to a company spokesman. The proposed $600-million Upland Pipeline Project, first reported by The Wall Street Journal in February , aims to transport up to 300,000 barrels a day of North Dakota crude to a connection in Saskatchewan. From there, approximately 70,000 barrels of that oil is expected to flow on TransCanada’s planned Energy East pipeline, which aims to ship up to 1.1 million barrels of oil a day nearly 3,000 miles across Canada to refineries and ports along the country’s East Coast. The rest of the capacity would feed other pipelines, although […]

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Canada Issues Directive Aimed at Slowing Crude-Carrying Trains

ENLARGE In this July 6, 2013, photo, smoke rises from railway cars that were carrying crude oil after derailing in downtown Lac Megantic, Quebec. The Canadian government issued an emergency directive late Thursday aimed at slowing crude-carrying trains traveling through urban areas. Photo: Associated Press Canada issued an emergency directive late Thursday aimed at slowing crude-carrying trains traveling through urban areas and requiring increased inspections and risk assessments along key routes used for transporting dangerous goods. The directive is the latest in a series of steps by the Canadian government to boost rail safety in the wake of a number of derailments of crude-carrying trains as crude-by-rail shipments rise. Trains will be required to slow to a maximum of 40 miles an hour through highly urbanized areas, Transportation Minister Lisa Raitt in a statement. She also ordered more inspections and risk assessments along major routes used for the transport […]

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Canada’s Own Oil Pipeline Problem

ENLARGE The Tl’azt’en First Nation, whose Tache Reserve is on Stuart Lake in British Columbia, is fighting Enbridge’s plan to build the Northern Gateway oil pipeline alongside their territory. Photo: ALISTAIR MACDONALD/THE WALL STREET JOURNAL TACHE RESERVE, British Columbia—A proposed 730-mile pipeline to ship Canadian oil to a West Coast port brings with it the promise of 4,000 or more jobs along a route that would run through impoverished indigenous communities. But Chief Justa Monk, who runs a reserve with an unemployment rate that hits 70%, wants none of them—and pledges to block the pipeline alongside the reserve’s territory. It is another hurdle in Canada’s quest to become an energy superpower, even as political struggles in Washington continue to delay a different, better-known Canadian pipeline — TransCanada Corp.’s Keystone XL, which would carry Canadian oil south across the U.S. to the Gulf Coast. Chief Monk’s Tl’azt’en Nation, which claims […]

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Infrastructure Gaps Put Canada’s “Energy Superpower” Potential at Risk

ENLARGE Brian Porter, chief executive officer of Bank of Nova Scotia, speaks during an interview in New York. Photo: Jin Lee/Bloomberg News OTTAWA—Canada’s ability to realize its potential as an “energy superpower” is at risk because of infrastructure gaps preventing oil and gas companies from properly accessing global markets, says a top executive at Bank of Nova Scotia . Scotiabank Chief Executive Brian Porter, in remarks prepared for the bank’s annual meeting in Ottawa, cautioned that stalled energy-infrastructure projects, such as pipelines, coupled with Canada’s overreliance on the United States as an export market, will have significant consequences for the country’s economy. Toronto-based Scotiabank is Canada’s third-largest bank by assets and is a lender to the energy industry. Even so, it is rare for a Canadian bank CEO to take such a strong stance on a public policy issue viewed as controversial by some. His remarks come as swooning […]

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Canadian Dollar Down as Oil Slump, Fed Minutes Damp Interest

Dow Jones Newswires By David George-Cosh TORONTO–The Canadian dollar fell for the second-straight day Wednesday after a sudden drop in the price of crude oil and a positive view on U.S. economic conditions from Federal Reserve officials made the U.S. dollar more attractive than its major currency peers. The U.S. dollar was most recently at C$1.2544, from C$1.2505 late Tuesday, according to data provider CQG. The release of the Federal Reserve’s March policy-making meeting minutes showed officials had an optimistic view on U.S. labor conditions, which will could warrant a policy rate increase as early as June. While the Fed minutes provided the U.S. dollar with some steam, the Canadian dollar was also hit by further weakness in crude oil prices. Oil fell 6.0%, to $50.70 a barrel on the New York Mercantile Exchange Wednesday, the biggest drop in two months, after U.S. crude-oil stockpiles increased to its highest […]

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Study Forecasts 70% Loss of West Canada’s Glaciers

The glaciers of the Canadian West could shrink by 70 percent by 2100, according to new research that has implications for predicting glacier loss around the world. The loss of mountain glaciers contributes to the rise in sea levels. As glaciers dwindle there could be also be pronounced effects on availability of water for aquatic creatures and for agriculture as well as water quality issues. The report, published Monday in the journal Nature Geoscience, combines scientific disciplines to develop an unusually powerful method of predicting glacier loss, including high-resolution regional models of current glaciers and the physics of ice flow. The researchers then applied their findings to the range of predictions of warming over time from the Intergovernmental Panel on Climate Change. Under the calculations in the paper, glaciers in Western Canada will shrink to less than 10 percent of the area they covered in 2005, and glaciers in […]

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U.S. oil-by-rail overshadows Canada’s

The volume of oil carried by rail in the United States far exceeds that in Canada, U.S. federal data show. Photo by Steven Frame/Shutterstock WASHINGTON, March 31 (UPI) — The volume of crude oil transported by rail in the United States is greater than the volume in Canada by a factor of nearly 9-to-1, federal data show. In a first, the U.S. Energy Information Administration said it was now publishing monthly data on the volume of crude oil transported on regional railways. "The new crude-by-rail data provides a clearer picture on a mode of oil transportation that has experienced rapid growth in recent years and is of great interest to policy makers, the public, and industry," EIA Administrator Adam Sieminski said in a statement Monday. U.S. oil production has accelerated at a faster pace than at any other time since record-keeping began more than 100 years ago. The growth […]

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Canada’s New Brunswick Province Bans Fracking, Plans Study

PORTLAND, Maine, March 26 (Reuters) – Lawmakers in New Brunswick voted on Thursday to prohibit fracking in the eastern Canadian province, committing to study the controversial method of extracting oil and gas for one year before reconsidering the ban in 2016. The province’s Liberal-led government said it will require five conditions be met before the moratorium is lifted. These include beefed-up environmental and health regulations, a plan for waste water disposal, consultations with aboriginal groups, a royalty structure, and the establishment of a "social license," which is the approval by local communities and stakeholders. "It is responsible and prudent to do our due diligence and get more information regarding hydraulic fracturing," said Energy and Mines Minister Donald Arseneault. The province is the latest of several in eastern Canada, including Quebec, Labrador and Newfoundland, and Nova Scotia, to stop companies from fracking while they study its impact. New Brunswick is […]

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Exclusive: CN Rail derailment numbers soared before recent crashes

TORONTO (Reuters) – Canadian National Railway’s safety record deteriorated sharply in 2014, reversing years of improvements, as accidents in Canada blamed on poor track conditions hit their highest level in more than five years, a Reuters analysis has found. Canada’s Transportation Safety Board (TSB) said on Tuesday that track failure may have played a role in CN’s three recent Ontario accidents, which have fueled calls for tougher regulation. The agency said oil unit trains, made up entirely of tank cars, could make tracks more susceptible to failure. Data obtained under access to information laws and analyzed by Reuters shows a broader trend, which has not been previously reported, and could pile more pressure on CN Rail to slow down trains or reduce their length. A crackdown on oil trains could raise the cost of shipping Canadian crude by rail. Trains operated by CN in Canada derailed along main lines […]

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Canadian Refiners Set to Buy More U.S. Oil With Wider Discount

(Bloomberg) — Cheaper North American oil is poised to replace West African and Middle East cargoes at eastern Canadian refineries with U.S. crude prices at the lowest level compared with the international benchmark in 14 months. Imports to Canada from outside North America averaged 244,089 barrels a day this month through March 15, down 27 percent from a year earlier, according to New York-based ClipperData, which tracks tanker shipments. Canada, the world’s fifth-largest oil supplier, produces most of its oil in the western province of Alberta and exports it south to the U.S. A lack of pipelines means Canada’s eastern refineries depend on imports by tanker and train. U.S. export “volumes have been growing pretty exponentially,” Katherine Spector, a commodities strategist at CIBC World Markets Inc. in New York, said by phone Wednesday. U.S. oil is “going to Eastern Canadian refineries and displacing waterborne light crude.” U.S. crude oil […]

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Canadian Oil Jobs Cut as Companies Slash Deeper Than 2008

(Bloomberg) — Another round of oil job cuts is rolling through downtown Calgary this week with three producers eliminating at least 650 positions in Canada as they wrestle with prices near a six-year low. ConocoPhillips is the latest, announcing Wednesday it’s terminating 200 people, about seven percent of the Houston-based company’s Canadian workforce. That follows cuts Tuesday by Talisman Energy Inc., which is eliminating 150 to 200 positions in its Calgary head office and Cnooc Ltd.’s Nexen Energy, which is reducing its Canadian headcount by 300. Cutting jobs is one lever energy companies are pulling as they reduce capital spending to adjust to lower cash flow after crude’s 60 percent slide since June. The latest measures add to thousands of jobs lost in Alberta earlier this year as producers slow development of the province’s oil sands, the world’s third-largest proven reserves. “We are seeing pretty aggressive cuts in terms […]

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Canadian natural gas E&P outlook weak: analyst

Houston (Platts)–17Mar2015/412 pm EDT/2012 GMT The outlook for Canada’s natural gas exploration and production industry will remain weak over the next several years as boosted US production, high North American stock levels and low prices continue to weigh on the profitability of the industry, the Conference Board of Canada said Tuesday. The dramatic rise in US shale gas production in the last several years, particularly in the Appalachian Basin’s Marcellus and Utica Shale plays has led to a decreased demand for imports of gas from Canada, said Michael Shaw, a CBC economist and co-author of a board study. "I think the US natural gas industry is going to do quite well," Shaw said in an interview. "I think that it doing so well it is going to push out Canadian imports and really hurt the Canadian industry." Canadian gas production, which last year averaged about 14.7 Bcf/d, can be […]

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Cnooc’s North American Unit Slashes 13% of Workforce

CALGARY—The North American headquarters of China National Offshore Oil Corp. said Tuesday it would cut about 13% of its workforce due to the slump in global oil prices , raising questions about terms of the Chinese state-owned company’s accord with the Canadian government. Cnooc said wholly-owned Canadian unit Nexen Energy ULC would reduce its 3,200-strong workforce by 400 jobs, including 340 in North America and 60 working for its British unit, to deal with falling revenue from a more than 50% drop in crude prices compared with mid-2014. It also said it would reorganize key business units and slow development on a new oil-sands project in northern Alberta. “In response to the recent industry downturn that has affected all companies in the energy sector, a decision was made to conduct a thorough review of our organization to ensure our long-term viability and sustainability,” Nexen Chief Executive Fang Zhi said. […]

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Canada Crude Falls Below $30; BMO Seeks Oil Sands Cost Cuts

(Bloomberg) — Canadian heavy oil prices fell below $30 for the first time in more than six years as Bank of Montreal warned that oil sands producers must cut costs. Western Canadian Select fell 59 cents to $29.85 at 12:28 p.m. Mountain time, the lowest since Feb. 18, 2009, according to data compiled by Bloomberg. The grade’s discount to U.S. benchmark West Texas Intermediate narrowed 80 cents to $13.60 a barrel. Crude futures settled at a six-year low of $43.88 in New York on concern record supply may strain storage capacity. The cash costs of oil sands producers must shrink to remain competitive in the “new normal of lower oil prices for longer,” BMO analyst Randy Ollenberger said in a note today. The majority of Canada’s crude comes from oil sands in Northern Alberta and is among the most expensive to produce. Companies including Royal Dutch Shell Plc and […]

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Oil-Sands Rules Get Tougher as Alberta Seeks Less Damage

(Bloomberg) — Oil-sands producers will be forced to reduce waste water and to clean up and restore mined land within a decade as Alberta seeks to reduce environmental damage. Regulation announced by Alberta Environment Minister Kyle Fawcett in Edmonton on Friday, include limits on water withdrawals from the Athabasca River in the Canadian province’s north. Companies will also be required to slow the growth of tailings ponds, which hold waste water from bitumen mining, and restore land that existing ones are on after 10 years of the end of the mine’s life, the minister said. Oil-sands operators have come under attack for environmental impact including emissions of greenhouse gas and fresh-water use, helping to stall pipeline construction such as TransCanada Corp.’s Keystone XL. Production of bitumen, forecast to more than double by 2030, is Canada’s fastest-growing source of carbon emissions. The new rules are a more “realistic” policy framework […]

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Western Canadian oil and gas output declines

Historic oil and natural gas production in Northwest Territories in Canada on the decline, federal data show. Photo by Calin Tatu/Shutterstock Oil and natural gas production from frontier prospects in the Northwest Territories is on a steady decline, federal Canadian data show Wednesday. The National Energy Board published data on production from the Norman and Ikhil fields in the Northwest Territories. The regional government estimates the western area may hold as much as 37 percent of the marketable light crude oil in Canada and as much as 35 percent of its gas. NEB said it estimates the region produced 3.9 million barrels of oil and around 2.9 trillion cubic feet of natural gas last year. That’s down around 25 percent for oil and 17 percent for natural gas when compared with production figures from 2010. David Ramsay, the regional minister of industry, told members of the Canadian Parliament last […]

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IMF: Canada squeezed by low oil prices

Low oil prices having secondary impacts on Canadian economy, a review from the International Monetary Fund found. (UPI/Shutterstock/Lilac Mountain) A January report from the IMF found lower crude oil prices would be a drag on investment activity in Canada, with the energy sector bearing the brunt of market trends. In its latest review, the IMF said Canada is facing additional pressures from an "over-heated" housing market and high household debt. Forecasters in January warned the Canadian housing market be slowing as interest rates rise with lower oil prices. Oil-rich Alberta province faces a risk of a "hard landing" in response. "Canada’s overvalued housing market may be cooling off," the IMF’s latest report said. Alberta leaders take up fiscal issues Tuesday when they convene for the start of a new legislative session. Premier Jim Prentice last week said lawmakers need to focus on a sustainable economic model that does away […]

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Alberta Energy Drillers Pivot to Natural Gas as Oil Plunges

(Bloomberg) — Alberta’s energy producers are pivoting toward developing gas reserves rather than oil after crude lost half its value last year. The number of gas development rigs in Canada’s biggest energy producing province almost doubled in December to 157, the most for that month since at least 2010, the Alberta Energy Regulator said in data posted on its website late Wednesday. The number of crude development rigs fell by 4.3 percent to 134. Alberta’s gas prices dropped 35 percent last year while oil fell 46 percent. U.S. crude prices have plunged below $50 from last year’s high above $107 after the Organization of Petroleum Exporting Countries resisted calls to cut output amid a surge of U.S. crude production. While most conventional petroleum rigs in Alberta produce both gas and oil, the collapse of crude prices is prompting drillers to focus on wells with higher gas volumes, Mark Oberstoetter, […]

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Encana Cuts 2015 Budget After 85% Fall In Operating Profit

URL: http://www.rigzone.com/news/oil_gas/a/137400/Encana_Cuts_2015_Budget_After_85_Fall_In_Operating_Profit CALGARY, Alberta, Feb 25 (Reuters) – Encana Corp, Canada’s largest natural gas producer, slashed its 2015 capital budget by a quarter on Wednesday in response to a slump in global crude oil prices. The company joins a slew of other Canadian oil and gas producers, including Suncor Energy and Cenovus Energy , that have cut back spending as benchmark crude prices more than halved since June. Encana said it will spend between $2 billion and $2.2 billion in 2015, down from the original budget of $2.8 billion announced in December. Chief Executive Officer Doug Suttles also said Encana, which since 2013 has been selling off natural gas assets to concentrate spending on regions rich in high-value gas liquids and oil, will look to see if there are further opportunities to trim its portfolio. "We are well prepared to act … The lower points in the commodity cycles […]

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Oil-Rich Alberta Sees Mass Job Loss as Crude Prices Slump

(Bloomberg) — Alberta, the Canadian province holding the world’s third-largest oil reserves, expects 31,800 jobs to be lost for the remainder of the year as a crude price crash forces producers to reduce costs. Even with the job losses, overall employment will rise 1 percent in 2015 because of gains carried over from December, the provincial finance ministry said Tuesday in a statement. That compares with a 2.2 percent increase in employment last year. It would take a loss of 80,000 jobs before year-end to prevent employment from rising, the government said. “Our reliance on the roller coaster of oil prices is something we have to change,” Finance Minister Robin Campbell said on conference call. “Even if the price of oil bounces back today, we can’t go on this way.” Suncor Energy Inc., Cenovus Energy Inc. and other oil producers have already shed thousands of jobs this year as […]

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Alberta Becomes Canada’s Most Pessimistic Region, Poll Data Show

(Bloomberg) — In a reversal of fortune, consumers in Canada’s prairie provinces Alberta, Saskatchewan and Manitoba have become the country’s most pessimistic. An index of consumer confidence calculated by Nanos Research for the prairies fell to 49.2 last week, putting it behind every other region for the first time since the series began in 2008. The decline has coincided with an oil price shock that has reduced prices for crude by more than half since June and triggered a housing market correction in cities such as Calgary and Regina. Ontario consumers have replaced those on the prairies as Canada’s most optimistic, according to the indexes. Every week, Nanos Research asks Canadians for their views on personal finances, job security, the outlook for the economy and where real estate prices are headed. This is what the survey data, which is compiled for Bloomberg News, captured for the week through Feb. […]

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Canada expects dip in crude oil production

Oil sands development in northern Alberta, Canada. Photo by chris kolaczan/Shutterstock WASHINGTON, Feb. 23 (UPI) — Growth in Canadian crude oil production is expected to slow by about 3 percent as oil prices weigh on future developments, industry leaders said. The National Energy Board in Canada said total crude oil production should average 3.8 million barrels per day in 2015. That’s about 3.5 percent less than last year and, with oil prices expected to stay well below the $100 per barrel mark for the foreseeable future, drilling activity in Canadian basins should experience a 40 percent decline year-on-year. Bill Wall, a technical specialist at the NEB, told UPI there should be a slowdown in future production, though existing products should be sustained despite the low price for oil. "Oil sands production is expected to grow, as several projects will be ramping up or coming on stream in 2015," he […]

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Canada’s Oilsands Face ‘Death Spiral’ If They Don’t Cut Costs

As the world’s oil glut continues to build, wiping out hopes of a price recovery, the head of one of Canada’s largest oilsands operators is warning the industry faces a “death spiral” if it doesn’t figure out how to cut costs. Speaking before the Chamber of Commerce in Fort McMurray, Steve Laut, president of Canadian Natural Resources Ltd. (CNRL), said oilsands companies can still return to health, but only if they aggressively begin to cut costs. Costs have risen so far, so fast that oil producers were making three times as much profit in 2004, when oil was at $40 a barrel, than they were a few years ago when oil was at $100 a barrel, Laut said, as quoted at the Globe and Mail . Laut’s call for cost cutting may be seen by some as a prelude to layoffs and project cancellations, but so far North America’s […]

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Canada Unveils an Oil-Train Safety Tax

A Canadian National Railway train carrying crude oil derailed near Timmins, Ontario last weekend. ENLARGE Photo: Transportation Safety Board of Canada/Reuters OTTAWA—Canada said it would create a compensation fund to cover the potential costs of oil-train derailments and finance the move with a new levy on crude shippers. The planned fund—first reported by The Wall Street Journal earlier Friday—was one of several new measures Canada unveiled to bolster the safety of a rail system carrying growing volumes of crude. Canada had pledged to hold railways and shippers more accountable after the derailment of a crude-carrying train in Quebec in July 2013 killed 47 people and wiped out the town’s core. The Lac-Mégantic accident spurred regulatory changes in the U.S. and Canada—from beefed up emergency-preparedness requirements to new rules governing railcars—while raising concerns about the risks the oil-by-rail boom poses to communities across North America. Those risks were highlighted again […]

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Canada Unveils Tax Breaks for LNG Development

Canada’s Prime Minister Stephen Harper. ENLARGE Photo: Zuma Press OTTAWA—The Canadian government unveiled Thursday tax breaks for developers of liquefied natural gas export projects in an effort to kick-start investment amid a low energy-price environment. At an event in suburban Vancouver, British Columbia, Canadian Prime Minister Stephen Harper said LNG developers would be eligible to write off industrial equipment and real estate at a faster pace. The write-off is eligible for equipment and real estate acquired after Thursday up until 2025. Ottawa estimates the cost to the federal treasury of about 50 million Canadian dollars (US$40.3 million) over a five-year period. The province of British Columbia, which is banking on LNG development and shipments to spur future growth, had lobbied for such tax breaks, as did the industry. Mr. Harper said in a statement that the move “builds on our low tax plan for jobs and growth, strengthening the […]

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Canada’s Oil Industry ‘In Near-Death Condition

BobInget on Thu, 19th Feb 2015 10:45 am  Before buying or increasing ones positions it’s a grand idea to express fault in whatever you are interested in. Here’s the latest rundown. In terms of reserves; Saudi Arabia comes in SECOND. Second to Venezuela. Canada trails at number three in the World. China cornered future Venezuelan exports. This leaves Canada open for sale.Canada and Venezuela. All the rest, except deep-sea, is window dressing. Bloomberg) — For debt investors betting Venezuela will default this year as oil slumps, there is one big wildcard that threatens to sink the trade: China. The Asian nation, whose $3.9 trillion in foreign reserves are the world’s largest, has a history of lending out money to Venezuela, having doled out $45 billion over the past decade. And it has a strong incentive to provide more — Venezuela sits on the world’s biggest oil reserves while China […]

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Canada Unveils New Sanctions Against Moscow, Sympathizers in Ukraine

Canada unveiled new sanctions Tuesday evening against Moscow and its sympathizers in Ukraine that includes among its highest-profile targets the chief executive of Russia state-owned defense company Rostec, Sergey Chemezov, and the state-run energy firm Rosneft. Canada said the latest round of sanctions would apply economic sanctions and travel bans against 37 Russian and Ukrainian individuals, and economic penalties against 17 Russian and Ukrainian entities. Besides Mr. Chemezov and Rosneft, others targeted by the new Canadian sanctions include lawmakers in the Russian legislature; military officials; the head of Russia’s largest motorcycle club, the Night Wolves; and members of the Donetsk and Luhansk separatist groups in Ukraine. An official at Russia’s embassy in Ottawa declined to comment when reached Tuesday night on Canada’s new round of sanctions. Canadian Prime Minister Stephen Harper said the measures were in response to “escalated acts of aggression” in recent weeks allegedly perpetrated by Russian-backed […]

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Canada railway strike ends after government threatens bill

OTTAWA, Canada (AP) — Canada’s labor minister said Monday the Canadian Pacific Railway strike had ended, with both sides agreeing to resume discussions. News of the deal came after Canada’s Conservative government threatened to introduce legislation to force an end to the strike by more than 3,000 Teamsters members, saying the strike posed a threat to the economy. In a surprise news conference, Labor Minister Kellie Leitch welcomed the willingness by both sides to resume talks, a development that had seemed impossible just hours earlier. The strike by 3,300 locomotive engineers and other train workers began just after midnight Sunday after contract talks failed. Leitch had said the strike could cost the economy more than $200 million in lost GDP every week. Teamsters union president Douglas Finnson called the government’s intervention in the strike disappointing and premature. CP Rail supported the move. Leitch had said the strike would affect […]

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