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Calgary & Alberta Economy

Apparently the Teck Board voted to shelve the Frontier Mine project this past Friday (I think this headline might be assuming more than what will happen - freeze project after approval perhaps, not pull the application, which has long been anticipated by everyone except the UCP):
Teck Resources pulls application for Frontier oil sands mine
www.theglobeandmail.com

Teck Resources pulling application for Frontier oil sands mine

The Teck mine had already passed a lengthy regulatory review and Ottawa was expected to decide this week whether to approve the project
www.theglobeandmail.com www.theglobeandmail.com
 
And Teck goes and pulls it! Wow. Citing the global financial market and climate change concerns.
 
So this is pretty much the death knell of any future oil sands expansion. I don't see how any other projects will be proposed. No company is going to invest the money to put a proposal together and go through that regulatory approval process, only to be disappointed.
Looks like the climate change movement has won something. Though the oil sands won't be shut down, there won't be further expansion unless there is drastic shortage of supply somewhere else in the world.
 
JonnyCanuck said:
So this is pretty much the death knell of any future oil sands expansion. I don't see how any other projects will be proposed. No company is going to invest the money to put a proposal together and go through that regulatory approval process, only to be disappointed.
Looks like the climate change movement has won something. Though the oil sands won't be shut down, there won't be further expansion unless there is drastic shortage of supply somewhere else in the world.
Click to expand...
i don think that's entirely correct, there are a number of approved oilsands projects that have been put on the back burner due to lack of pipeline access. A number of them could go ahead when TMX, Line 3 and possibly Keystone are completed.
 
JonnyCanuck said:
So this is pretty much the death knell of any future oil sands expansion. I don't see how any other projects will be proposed. No company is going to invest the money to put a proposal together and go through that regulatory approval process, only to be disappointed.
Looks like the climate change movement has won something. Though the oil sands won't be shut down, there won't be further expansion unless there is drastic shortage of supply somewhere else in the world.
Click to expand...
potatopizzafan said:
i don think that's entirely correct, there are a number of approved oilsands projects that have been put on the back burner due to lack of pipeline access. A number of them could go ahead when TMX, Line 3 and possibly Keystone are completed.
Click to expand...
How about "end of the new megaproject era"? and yeah, the movement won when they convinced the insurers to include climate risk in their models, so the bond people couldn't insure bonds with too much climate risk, which destroys the secondary market for the bonds. Also that Teck isn't an oil company, it is a mining company that makes 2/3rds of its profit from steelmaking coal exported on a single rail line.
1582570256311.png
 
I really think it is the end of any additional production that will contribute to more carbon emissions from Alberta. The 'counter forces at play' will work against it unless we can demonstrate significant reductions elsewhere.
Does anyone know what converting power plants from coal to natural gas, will do for Alberta's overall emissions? Will there be much room to play with after the conversion?
 
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JonnyCanuck said:
I really think it is the end of any additional production that will contribute to more carbon emissions from Alberta. The 'counter forces at play' will work against it unless we can demonstrate significant reductions elsewhere.
Does anyone know what converting power plants from coal to natural gas, will do for Alberta's overall emissions? Will there be much room to play with after the conversion?
Click to expand...
Yes, lots of room to play. Coal to gas conversion buys about 10 years of extra life for plants until they get caught up in the natural gas facility performance regulations, so they are great for giving more runway to let other tech mature so we don't have to rush.

CERI has decarbonization scenarios for each province, and Alberta's best bet is just boat loads of wind with natural gas backup (in the short term), possibly natural gas with carbon capture, geothermal, or advanced tech (oil/coal/gas to hydrogen in-situ reformation) in the longer term (much cheaper energy storage might negate the use of exotic tech).

As for large ghg reductions ... here is the end use of energy in the province:
1582583902563.png

and by fuel:
1582583928303.png

and the resulting ghgs:
1582583958765.png


So the biggest opportunities after electricity are in reducing the ghg emissions of natural gas in industry. We just need to decide to start pumping our natural gas networks (where compatible so it couldn't be the entire network) with 30% hydrogen, and either producing the hydrogen in a low ghg way, or dumping those ghgs in a carbon capture process. You can move to 30% hydrogen with almost no retrofits in end user equipment according to field tests in Europe.
 
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Massive hit to the economy today, Cenovus and Suncor have both lost a massive amount of their value and trading was halted in the markets just a few minutes into trading. This could be very bad for Alberta...
 
Not looking good at all DJI and the TSX are both down well over 1000 points. West Texas Crude is down 25% (biggest single day drop since the gulf war) and Western Canadian Select is down ~15% last I checked. Hopefully Saudi Arabia and Russia can dig their head out of the sand soon and make the situation a bit better, but I feel like things are going to be rough going until the whole Covid-19 thing blows over, but that may take a long while.
 
Almost seems like it was a bad economic plan to prioritize austerity and balancing the budget while also cutting government revenues and making a major bet that oil prices recover.

It's not too late to embrace deficit spending for the sake of economic stimulus targeted in economic sectors that have the potential for real growth, and shift our revenue to more reliable sources.
 
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