July 28, 2017

Affordable Energy News for July 28, 2017

Affordable Energy News for July 28, 2017

Desjardins is making a big mistake caving into anti-oil activists: Gardner

Desjardins, the biggest credit union group in the country and one of the institutions involved in financing Trans Mountain, announced earlier this month that it would suspend its funding of pipeline projects in Canada and will decide in September whether to end the practice permanently. Desjardins was pressured by radical activists who oppose nearly everything about Canada’s energy industry and, given its announcement, Desjardins seems to be throwing in the towel. The fact that a large Canadian financial institution like Desjardins is buckling to activists who have no interest in an honest debate on Canada’s energy resources is troubling. - National Post


The more governments abuse and misuse carbon taxes, the more Canadians dislike them

Several Canadian provinces have implemented climate change action plans containing several key components and, of course, a carbon pricing program. More recently, after adopting the Paris climate commitment, Ottawa announced it would establish a “backstop” price for greenhouse gas emissions starting at $10 per tonne in 2018, rising to $50 per tonne in 2022. Provinces that don’t adopt equivalent provincial policies will have that new federal tax imposed on them. However, a recent poll by the Angus Reid Institute suggests that the more people learn about carbon pricing the less enamoured they are of such schemes, particularly at the federal level. According to the poll, at least half the population (outside Quebec) oppose the federal tax plan, and a large swath of the public in Alberta (68 per cent) and Saskatchewan (71 per cent) want their leaders to oppose the federal plan. - National Post


TransCanada looks to expand Canadian Mainline pipeline in Ontario amid improved profit

TransCanada Corp. announced plans to expand its Canadian Mainline pipeline in southern Ontario as it reported an improved second-quarter profit compared with a year ago. The company says it plans to spend $160-million in increase capacity of the natural gas pipeline. The project will add compression and associated facilities to transport an additional 80 million cubic feet of natural gas per day. Meanwhile, TransCanada said it earned $881 million attributable to common shareholders or $1.01 per diluted share for the quarter ended June 30. That compared with a profit of $365 million or 52 cents per diluted share in the same quarter last year. Revenue for the quarter totalled nearly $3.22 billion, up from $2.75 billion a year ago. CEO Russ Girling said the improvement was due to the acquisition of the Columbia Pipeline Group last year, strong performance in its pipelines businesses and higher earnings from Bruce Power. - Global News


World gears up for electric cars despite bumps in road

Technological advances mean fossil fuel in cars could be phased out within decades but switching to electric carries its own environmental and economic concerns as more and more countries announce radical plans. Britain on Wednesday said it would "end the sale of all conventional petrol and diesel cars" by 2040, following similar proposals by France earlier this month to reduce nitrogen dioxide (NO2) pollution. China issued plans last year requiring that 12 per cent of cars sold be battery-powered or plug-in hybrids by 2020, while India has said it wants to replace all vehicles with electric vehicles by 2030. "Given the rate of improvement in battery and electric vehicle technology over the last ten years, by 2040 small combustion engines in private cars could well have disappeared without any government intervention," said Alastair Lewis, professor of atmospheric chemistry at the University of York. "Nonetheless this is highly symbolic since it signals to both the public and to manufacturers that there is no turning back from electrification," he added. - CTV News


TransCanada seeking more Keystone XL shippers as oilsands growth slows

TransCanada Corp. said Thursday that it’s looking for more oil shipment commitments for its Keystone system, as expected oilsands growth slows and major international players continue to retreat from the region. Company spokeswoman Jacquelynn Benson said the company is looking for 225,000 barrels a day of commitments on the controversial Keystone XL project, which would have capacity to ship about 830,000 barrels a day from Hardisty, Alta., to markets in Cushing, Okla., and the U.S. Gulf Coast. - Financial Post


Oilsands developers abandon nearly one million hectares of exploration leases

In another sign the bloom is off the boom for the oilsands, the industry has returned almost one million hectares of northern Alberta exploration leases to the province over the past two years — abandoning an area far bigger than P.E.I. The total area covered by oilsands leases remained constant at about nine million hectares between 2011 and 2014. But it fell to 8.5-million hectares in 2015 and 8.1-million in 2016, following the crash in world oil prices from over US$100 to under $60 per barrel in 2014. Most of the returned acreage either represents expired or surrendered leases, according to Alberta Energy, which provided the statistics at the request of The Canadian Press. Observers were surprised by the size of the lease returns which they attributed to industry cost-cutting and disinterest in spending to develop new prospects when there’s no money to build projects already on the books. - Financial Post


What the Supreme Court rulings mean for pipeline proponents (it could be good news)

At first glance, the Supreme Court's recent rulings on energy infrastructure might seem like a blow to the pro-development forces in Canada aiming to tap the country's natural resources. After all, the top court quashed seismic testing in the North, seen by some as the next frontier for oil and gas extraction. However, a closer reading of both the Clyde River and Chippewas of the Thames decisions might give pipeline proponents in particular some solace. - CBC


'Dithering' by B.C., Ottawa helped kill Pacific NorthWest LNG, energy CEO says

The CEO of one of Canada's biggest natural gas producers says "government dithering" played a role in the cancellation of a massive liquefied natural gas project in British Columbia. Malaysia's Petronas cancelled its $11.4-billion Pacific NorthWest plant on Tuesday, citing lower prices in recent years in export markets in Asia. - CBC


United States

Oil prices trade near 8-week highs, on track for biggest weekly gains this year

Oil prices edged higher for a fifth straight session on Friday, reaching fresh two-month highs and on track to post the strongest weekly gains this year as investors digested signs of an easing oversupply picture. U.S. crude and gasoline inventories fell much more steeply than expected this week and the world's biggest oil exporter Saudi Arabia said it would further reduce oil output in August. Brent crude futures were up 18 cents at $51.67 a barrel at 7:14 a.m. (1114 GMT) after reaching a fresh two-month high. The front of the crude oil curve jumped into backwardation, with the month-ahead trading above the subsequent month, showing investors are not expecting recent gains to last. U.S. West Texas Intermediate (WTI) crude futures were up 3 cents at $49.07 a barrel, near a two-month high of $49.24. - CNBC



U.S. coal exports soar, in boost to Trump energy agenda, data shows

U.S. coal exports have jumped more than 60% this year due to soaring demand from Europe and Asia, according to a Reuters review of government data, allowing President Donald Trump's administration to claim that efforts to revive the battered industry are working. The previously unpublished figures provided to Reuters by the U.S. Energy Information Administration showed exports of the fuel from January through May totaled 36.79 million tons, up 60.3% from 22.94 million tons in the same period in 2016. While reflecting a bounce from 2016, the shipments remained well-below volumes recorded in equivalent periods the previous five years. They included a surge to several European countries during the 2017 period, including a 175% increase in shipments to the United Kingdom, and a doubling to France, which had suffered a series of nuclear power plant outages that required it and regional neighbors to rely more heavily on coal. - Reuters


United Kingdom

U.K. households shun green energy

Energy providers are being urged to do more to promote green energy after a survey revealed just 1% of the population is on a green tariff. Despite years of education and falling costs for green energy options consumers still say renewable energy isn’t a priority. The poll, conducted amongst energy bill payers and commissioned by ENGIE, revealed that half of consumers don’t consider green energy tariffs because they think their bills will rise while a third say they’ve never even been offered a green energy tariff. - London Loves Business



Australia Pacific Liquid Natural Gas test completion raises hopes of increased east coast gas

The completion of a critical performance test at Origin Energy's APLNG export venture in Queensland has raised hopes that more gas will be made available for east coast buyers, which are struggling to source supplies at affordable prices. The 90-day test, needed to satisfy the lenders to the $27-billion project, was completed on Thursday. The venture will now have the option of pulling back production from rates as high as 10% beyond full capacity, and supply more gas for the local market instead of for export. The development comes at an important time for the east coast gas sector, with the government to decide by November 1 whether the local market is tight enough to warrant pulling the trigger on LNG export controls for 2018. - Australian Financial Review


IFM Investors to sell Victorian gas-fired power stations

Global infrastructure player IFM Investors is understood to have put its two gas-fired power stations in Victoria up for sale, paving the way for what is expected to be a sale worth several hundred millions of dollars. The sale of the Ecogen Energy portfolio, involving almost 1000 megawatts of capacity, will test appetite for gas-fired generation at a time when prices for the fuel are soaring, putting a question around its future competitiveness in a market where renewables are gaining ground. But wholesale power prices have also seen a major upward shift over the past 12 months, after the closure of about 5000 megawatts of coal-fired capacity in the last five years markedly tightened the balance between supply and demand. - Australian Financial Review