Category Archives: Oil and gas industry

Canada Is Now A Land Of Oil Trains… wonder where it’s all going?

Repost from Huffington Post Canada
[Editor: …and this Canada news is relevant here in the U.S. because…?? Well, check out the map below.  – R.S.]

Canada Is Now A Land Of Oil Trains

This is happening even as Canadian crude sells at prices not seen in the oil markets since the 1990s.

By Daniel Tencer, 11/21/2018 12:04 EST

Crude oil and other petroleum products are transported in rail tanker cars on a Canadian Pacific Railway train near Medicine Hat, Alta., Sept. 10, 2018.
Crude oil and other petroleum products are transported in rail tanker cars on a Canadian Pacific Railway train near Medicine Hat, Alta., Sept. 10, 2018. LARRY MACDOUGAL/CANADIAN PRESS

Canada’s oil industry is facing record-low prices for its exports, a glaring lack of infrastructure to bring its product to market, and an uncertain long-term outlook.

But none of that is stopping the oil patch from increasing production. And as one pipeline project after another fails to launch, the industry is relying more heavily than ever to ship its oil by rail.

According to Statistics Canada, the volume of oil on Canada’s railroads has soared by 64.6 per cent in just the past year. And in the past seven years, the number of rail cars carrying oil across Canada has quadrupled.

Oil-by-rail shipments in Canada reached a record high of nearly 20,000 rail cars in August this year. By volume, oil-by-rail is up by more than 64 per cent in the past year. HUFFPOST CANADA 

The spike in oil trains began around 2011, a few years before the July, 2013, disaster in which a 74-car oil train derailed in Lac-Megantic, Que., killing 47 people.

Besides the obvious risk to the environment and to human life, there is also the fact that oil producers are crowding out other industries that rely on rail.

This leads to “higher costs and shipping delays for other industries,” Bank of Montreal senior economist Sal Guatieri wrote in a client note Tuesday.

“Surging railway loadings of oil contrast with flat loadings for shipments of wheat, copper, machinery and many other products in recent years.”

And if you think these oil trains don’t come through your neighbourhood, that they’re somehow limited to Alberta, take a look at this map of the oil rail network in Canada, provided by the Canadian Association of Petroleum Producers:

A map of Canada’s oil-by-rail network and its connection to U.S. terminals. CANADIAN ASSOCIATION OF PETROLEUM PRODUCERS  [click to enlarge]
This massive expansion of oil-by-rail took place even as oil prices remained relatively weak, Canadian oil exports particularly so. This is especially true today; North American oil prices have dropped by some 31 per cent since a peak in early October, and closed at around US$53 on Tuesday.

Canadian oil has been selling at an enormous discount to that, recently trading below $14 a barrel. The last time global oil prices were anywhere near that low would have been the late 1990s.

But it’s not just Canada that seems to be desperate to get as much of its oil out of the ground right now as possible.

“Saudi Arabia is pumping oil like never before, its output surging to a record 10.6 million barrels per day in October,” National Bank of Canada economist Krishen Rangasamy wrote in a client note Wednesday.

“Iraq’s output is also on the rise as production from the Kirkuk region comes back online. Those are more than offsetting declines in sanction-hit Iran.”

Not to mention, U.S. oil extraction has surged in recent years to the point it is now the world’s largest producer of crude.

Meanwhile, traders are losing faith in oil’s prospects as the global economy shows signs of weakening.

“The deceleration of world economic growth ─ as evidenced by ugly (third-quarter economic) results in places such as Japan and the Eurozone … has clearly hurt demand for oil,” Rangasamy wrote.

Amidst all this, some executives in Canada’s oil patch have called for the Alberta government to use its existing powers to limit the amount of oil being pumped. So far, the province hasn’t indicated it plans to follow that advice.

Hey, at least we get cheaper gas

But there is one benefit to consumers from crude producers’ race to the bottom of the oil deposit: Lower fuel prices.

“The free-fall on energy markets … helped force down pump prices across Canada by 2.1 cents a litre to $1.13, their lowest since October 2017,” analyst Dan McTeague of GasBuddy wrote this week.

“As pump prices now stand 5.6 cents a litre lower than on this same day last year, much of the credit can be given to the unexpected and likely temporary decline in oil prices, which could be subject to an upturn once OPEC and Russia agree to production curbs beginning in December.”

America Voted. The Climate Lost.

Repost from The New Republic
[Editor: Benicia wasn’t alone in this last election, suffering from the intrusion of Big Oil’s Big Money.  Oil companies ratcheted up their meddling in local politics all across the land.  This article highlights only a few: oil interests apparently spent $20 million in WA and $40 million in CO defeating key measures (carbon fee & fracking safety rules respectively).  – R.S.]

Fossil fuel companies spent record amounts to oppose pro-climate ballot initiatives, and it paid off.

By EMILY ATKIN, November 7, 2018

The last two years in American politics have spelled trouble for the global climate, thanks largely to the Trump administration. And the next two years probably won’t be much better, given the results of Tuesday’s midterm elections.

Voters failed to pass a historic ballot initiative in Washington state to create the first-ever carbon tax in the United States. They rejected a ballot measure to increase renewable energy in Arizona, and to limit fracking in Colorado. Some of Congress’ most outspoken climate deniers held onto their seats. Several candidates who ran on explicitly pro-climate agendas lost.

Democrats did not quite get the blue wave they wanted, but it was even worse for environmentalists. There was no green wave whatsoever. That’s partially because of record political spending by the fossil fuel industry to oppose pro-climate initiatives, but also because of the Democratic Party’s failure as a whole to draw much attention to the issue.

The midterm elections were always going to be consequential for climate change. The world’s governments only have about twelve years to implement policies that can limit global warming to 1.5 degrees Celsius. That’s the point at which catastrophic impacts begin, according to a recent report from an international consortium of scientists.

The U.S., as the largest historical emitter of greenhouse gases, is essential to achieving that target. But for the last two years, the U.S. government has been ignoring the need to reduce emissions—and in many cases, actively working against it. Along with withdrawing from the Paris climate agreement, President Donald Trump has been attempting to repeal and weaken existing climate regulation, with the support of the Republican-controlled Congress.

The midterms gave voters two opportunities to change America’s course on climate change. They could have elected a Congress that would no longer support Trump’s anti-climate agenda. And they could have approved strong statewide climate policies to counter the federal government’s inaction.

Voters took the first opportunity, but only slightly. Democrats won the House of Representatives, making it near-impossible for Trump to pass any anti-climate legislation.

But voters didn’t elect many candidates who ran on pro-climate agendas. Environmentalists had hoped that Florida, being on the front lines of climate change, would make history in that regard. But Democratic Senator Bill Nelson, a climate champion, was unseated by Governor Rick Scott, a Republican accused of banning the word climate from state government websites. And Democratic gubernatorial candidate Andrew Gillum, who pledged to act swiftly on climate, lost to a Republican who has dismissed the problem.

Voters rejected almost every opportunity to enact strong state-level climate policies.The biggest failure by far was in Washington. Initiative 1631 would have made the state the first in the country to charge polluters for their emissions. The proceeds from the carbon fee could have provided Washington with “as much as $1 billion annually by 2023 to fund government programs related to climate change,” Fortune reported, and “potentially kickstart a national movement to staunch greenhouse gases.” The measure lost by 12 percentage points.

The renewable energy ballot initiative in Arizona also presented a big opportunity to reduce emissions. Proposition 127 would have required electric companies in Arizona to get half of their power from renewable sources like solar and wind by 2030. (In a rare win for the environment on Tuesday, Nevada voters passed their own version of that initiative.) Proposition 112, Colorado’s ballot initiative to keep oil and gas drilling operations away from where people live, was far more about protecting public health than it was about limiting climate change. But the effect would have been to limit further fossil fuel extraction in the state.

The oil and gas industry spent quite a lot of money opposing all of these pro-climate ballot initiatives. The campaign against Washington’s carbon fee “raised $20 million, 99 percent of which has come from oil and gas,” according to Vox. The carbon fee was thus one of the most expensive ballot initiative fights in Washington state history. The renewable energy fight in Arizona was also the most expensive in state history because of oil industry spending. The same was true for Colorado’s anti-fracking measure, as the oil and gas industry clearly spent nearly $40 million opposing it.

While Tuesday’s results show the impact of massive political spending by the fossil fuel lobby, they also shine a light on Democrats’ failure to mobilize voters on the issue. The Democratic Party has failed to treat climate change with much, if any urgency this election season. According to The New York Times, the “vast majority” of the party’s candidates did not mention the problem “in digital or TV ads, in their campaign literature or on social media.” And the party’s leaders in Congress have given little indication that they intend to prioritize climate change in the future. Is it any wonder voters weren’t excited about solving the problem, either?


Correction: A previous version of this story stated that Nevada voters rejected Question 6, a ballot initiative on renewable energy. The measure won. 

Emily Atkin is a staff writer at The New Republic.

Investment execs: Oil and gas must face its future as a ‘declining industry’

Repost from The Energy Mix, originally from Financial Times

Fossils Must Face Their Future As A ‘Declining Industry’, Investment Execs Assert

June 18, 2018, primary Author Anton Eser and Nick Stansbury
lalabell68/Pixabay

Oil and gas must prepare to “face its future as a declining industry” and leave it to finance and investment professionals to allocate the US$29 trillion that will be needed by 2050 to decarbonize the global energy system, two senior investment executives argue in a recent post for the Financial Times.

Capital investment markets, in turn, will need the policy certainty to get on with the job, write Chief Investment Officer Anton Eser and fund manager Nick Stansbury of Legal & General Investment Management (LGIM), an arm of the UK’s Legal & General insurance company.

“Whilst the 2015 climate agreement in Paris offers some help, we still lack clear policy signals on what the long-term price for carbon is going to be, and when there will be an effective mechanism to implement it,” they write. “Without this certainty, pricing carbon risks and opportunities is going to remain highly complex.”

While the biggest challenges facing oil and gas are “a reasonable distance in the future”, Eser and Stansbury say the industry will no longer be able to rely on growing demand and production declines in mature oilfields to keep global markets in balance. Peak demand, in particular, is on the way, and “will have a big, and under-appreciated, destabilizing effect” when it arrives.

That leaves two choices for oil and gas companies—trying to reinvent themselves as renewable energy businesses, or beginning to ramp down their investments and return more cash to shareholders. But the two analysts declare themselves skeptical that fossils can make the transition to the renewable energy sector.

“The business models are very different, and the oil industry is likely to have a different cost of capital to the renewable sector,” the write. “We see few oil companies with a record of creating real shareholder value in this area.”

In that light, they see the second option as more promising. “The time to stop investing is not today,” they write, “but that point is coming. The industry needs to be clear that its future is one of long-term decline—whilst returning increasing sums of cash to investors. There is a possibility that the industry over-invests as we reach that point of peak demand, leaving an oversupply that persists for a long time. Fighting for market share in a declining market would be even worse.”

To maintain a place with the growing number of investment funds that emphasize environmental, social, and particularly climate strategies, Eser and Stansbury say oil and gas companies will have to “articulate a much clearer long-term strategy and the role they have to play in the energy transition.” More realistically, they say fossils can play a “positive part” as a “cash-generating engine that can be used to power the transition when the time comes, and we urge the industry to make a clear commitment to this future.”

Local and Ecuador leaders protest at Chevron in Richmond

Press Release from AmazonWatch

Bay Area environmental and indigenous organizations join protest to call attention to Chevron’s key role in causing destruction to people and planet

MAY 17, 2018, FOR IMMEDIATE RELEASE
Tell Amazon.com to Protect the Real Amazon!
AMAZON WATCH

Richmond, CA – Indigenous leaders from the Ecuadorian Amazon joined Bay Area allies at Chevron’s Richmond Refinery on Thursday morning to call on California’s political leadership to phase out oil and gas production and processing in the state, including its importation of crude oil drilled in the Amazon rainforest.


For more information contact:
Moira Birss 1.510.394.2041 moira@amazonwatch.org
Zoë Cina-Sklar 1.510.671.1878 zoe@amazonwatch.org
Interviews, photos, and more information available upon request


Gloria Ushigua and Manari Ushigua, leaders of the Sapara people, called attention to the impacts that the fossil fuel economy – including Chevron’s key role in causing destruction to people and planet. In addition to Chevron’s toxic legacy in Ecuador, the Sapara leaders and allies from Communities for a Better Environment, Green Action, and Bay Area indigenous-led organization Idle No More SF Bay outlined how California’s oil and gas extraction and processing is harming communities from the Ecuadorian Amazon to Richmond, California.

The Sapara Nation of the Ecuadorian Amazon is recognized by UNESCO as an “Intangible Cultural Heritage of Humanity” because their language and culture are in danger of disappearing. There are about 500 Sapara people still living in their ancestral home, a large territory that is a critical part of the Amazonian ecosystem. However, Sapara territory – and the Sapara themselves – are in serious danger from oil drilling planned for two oil blocks that overlap with approximately 500,000 acres of their ancestral territory.

Chevron refineries throughout California are the largest purchasers and processors of crude oil imported from the Amazon rainforest, as well as one of the state’s biggest overall polluters. A 2017 Amazon Watch report demonstrated that half of crude oil exports from the Western Amazon come to California, adding to the toxic impact of the California’s fossil fuel production and refining industry.

Manari Ushigua Santi, Sapara Nation, said: “The possibility of oil drilling in our territory – something the Ecuadorian government is pushing – could be the end of the Sapara people, and certainly an end to our strong connection with the forest. After all, there are few of us, and we have seen the deforestation and cultural destruction already caused by oil drilling in other parts of the Amazon. Now that we know about the link between oil from the Amazon and California refineries, we know that the state government’s continued support of the oil industry also puts us and other peoples of the Amazon in danger.

Gloria Ushigua Santi, Sapara Nation, said: “We are all fighting for our survival, to protect our little pieces of land. I have seen how destructive the fossil fuel industry is for California’s own communities. I don’t want our land to become polluted, like this land by the refinery. We call on California’s leadership to move quickly from an unsustainable reliance on a fossil fuel economy to a sustainable one based on renewable energy. Anything less puts the Sapara, the Amazon and other Amazonian indigenous peoples, California communities, and our entire global climate in danger.”

Isabella Zizi, Idle No More SF Bay, said: “It’s important to be here today because it shows that the very resistance starts in our own backyards. It makes a direct connection to what is happening down in the Ecuadorian Amazon with our indigenous brothers and sisters and our relatives down there who are facing the same destruction and harms to their own people and that we can come together and unite and make change together and stand up to Big Oil.”

Andrés Soto, Communities for a Better Environment, said: “I’m here today representing Communities for a Better Environment with our ongoing solidarity with Amazon Watch and the advocacy that connects the extractive activities in Ecuador directly to the refining activities in Richmond and the commonalities of not only health impacts but also political corruption. We need to link our resistance because we’re dealing with transnational corporations and so we also need to have a transnational resistance.”

Leila Salazar-López, Amazon Watch Executive Director, said: “Continued oil and gas extraction in California – both on land and offshore – and its imports of Amazon crude is a significant obstacle to doing what science says must be done to prevent the worst outcomes from climate change: keeping fossil fuels in the ground.”