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Page added on July 13, 2013
Lac-Megantic train crash: How it will change Canadian oil
The Lac-Megantic train crash, among other recent oil mishaps, is making it difficult for Canada to put a good face on their oil resources. Canadian Prime Minister Stephen Harper said parts of Quebec look like a ‘war zone’ following last weekend’s Lac-Megantic train crash.
Canadian oil production is expected to be in a boom cycle for the next 20 years or so, fed largely by oil sands production in Alberta. Smaller players in the vast oil sands region are already making a splash with new operations while majors like TransCanada and Enbridge are quickly getting back to work following last month’s flooding. Canadian Prime Minister Stephen Harper said parts of Quebec look like a “war zone” following last weekend’s train wreck. With a fight on his hands to counter the dirty oil narrative, his administration, and those invested in the energy sector, may face more combat in the future if the oil sands engine runs out of track.
The Canadian Association of Petroleum Producers expects national oil production to hit 6.7 million barrels per day by 2030, more than double the production level from last year. North American oil production is so strong that it’s too much for existing pipeline capacity to handle. Canadian energy company Enbridge just got its pipeline services back on stream following devastating floods in oil-rich Alberta. It aims to build the mega Northern Gateway pipeline to British Columbia for energy-hungry Asian markets. On the other side of the country, Harper was forced to deal with the “war zone” left over when an oil train derailed in a Quebec town near Maine, refueling the oil debate on both sides of the border. (Related article: China’s Oil Demand Set to Fall as Environment Finally comes before Economy)
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CAPP said oil production from Alberta is expected to make up about 75 percent of the production gains through 2030. While no secret to those in the industry, oil sands production has been in the public’s eye for the past few years because of thedebate surrounding TransCanada’s planned Keystone XL pipeline from Alberta through the United States. In the shadow of giants like Enbridge and TransCanada are juniors like Aroway Energy, which said Wednesday it got the nod from the Alberta Energy Regulator to increase production from its Kirkpatrick Lake operations in the province. CEO Chris Cooper said the approval “could not have come at a better time” because oil prices are at all-time highs for the year. The boom from Alberta is such that even OPEC stood up and took notice in reporting this year.
Harper spent last month trying to woo European investors to the Canadian economy. European leaders are considering legislation that would put a black mark on Alberta’s oil sands because they’re seen as more polluting than other types of crude oil. Canadian Natural Resources Minister Joe Oliver said the Harper administration didn’t want its “reputation sullied” over oil sands. (Related article: For Better or Worse, Big Oil has Big U.S. Future)
Aroway in February said it had almost doubled production from 600 to more than 1,000 barrels of oil equivalent per day in quick fashion thanks to Alberta oil sands. Rival majors like Talisman Energy, however, are slashing their spending already because of higher operating costs. The U.S. oil boom in states like Texas and North Dakota, meanwhile, may leave Canadian companies in the dust. Harper, for his part, was in enemy territory in a European community already debating how it can outdo renewable energy goals it hasn’t even met yet. The mid-term outlook for even marginal players in Canadian oil sands, like Aroway, looks optimistic. The energy tides may be shifting, however, suggesting that while production may gain steam, Canada’s heavy reliance on heavy crude may run off the rail.
7 Comments on "Lac-Megantic train crash: How it will change Canadian oil"
BillT on Sat, 13th Jul 2013 1:40 pm
Wait until they have a few more of these and they cannot be covered up. The Tar sands and the fraking craze is on limited time. Will they be closed because of the damage to the ecosystem or will they be closed because their products are too expensive, or both? We shall see.
rollin on Sat, 13th Jul 2013 3:13 pm
I vote for cost being the major player to end oil and then the politicians will jump in with ecological reasons to end it, thus looking like heroes taking down a near dead lion.
Can’t wait for those hover boards and hover conversions on my thorium powered automobile.
By the way that was North Dakota oil on the Lac Megantic train.
GregT on Sat, 13th Jul 2013 4:15 pm
Ever since I was a child, we always referred to the Alberta ‘oil sands’ as the Athabaskan tar sands. Everyone knew that they were there, but they were never considered to be a viable resource. After all, Alberta was rich in oil, a never ending supply of the stuff.
Fast foreword thirty years or so, and we now call them the Oil Sands, and consider them to be a vast untapped store of national wealth.
If this isn’t a wake up call that the world is running out of oil, I don’t know what is. We are open pit mining the dregs now, the last of them, and they too will run out.
Maybe now might be a good time to start planning for a future without oil.
Plantagenet on Sat, 13th Jul 2013 4:33 pm
Oil trains are dangerous.
Obviously Canada will be building more oil pipelines, and routing them AROUND towns. Unfortunately, thanks to the Obama administration’s opposition to the Keystone XL Pipeline the US will probably continue to be stuck with dangerous oil trains.
DC on Sat, 13th Jul 2013 5:31 pm
Harper thought he had a sure winner when he told his US handlers he could move their diluted asphalt to the Koch refineries despite the opposition to his pals planned tar-pipe. Harper has been pretty quiet about this crash, and for good reason. This was his ‘plan b’ to sneak the sludge across the country. Now, that it has, literally blown up in his face and incinerated folks to point there remains will likely ever be identified, he doesn’t exactly want people to connect this accident to his US tar-sands agenda.
Is this what the US puppet harper means by:
http://www.youtube.com/watch?feature=player_embedded&v=-i1wMCacHnI
Probably not. How much public infrastructure and money has the harper regime directed towards non-oil alternatives for either energy or transport. Exactly none. How much has he given to US oil corporations to destroy Alberta, billions.
Feemer on Sun, 14th Jul 2013 3:01 pm
This was a sad event, but it’s not like this occurred just because it was related to the dirty tar sands. It is very unfortunate that all this fracking and strip mining for oil is happening. People believe fracking for natural gas creates less pollution, and it is true less CO2, SO2, and NO2 is created from the combustion of natural gas, but the wells are leaking so much methane, which is GREATLY more powerful of a greenhouse gas than carbon dioxide. This oil is more expensive as well. People say the US will be energy independent in a few years, but if by some miracle we are, how much will a gallon of gas (petrol) cost? and for how long will we be energy independent? the fracking wells run dry in a about 4 years, so say the maximum of wells drilled occurs in 2015 or so, even 2016, by 2020 nearly all wells will be exhausted, and the natural gas infrastructure that is being built and will be built will be almost useless
Matt Mushalik on Mon, 15th Jul 2013 3:43 am
The derailment and explosion of this shale oil train highlights desperate attempts by refineries along the US/Canada East coast to offset the conventional oil peak of Atlantic basin producers who traditionally supplied them with Brent type crude.
14/7/2013
The high cost of railroading unconventional crude oil
http://crudeoilpeak.info/the-high-cost-of-railroading-unconventional-crude