Total, the French energy company, has paid $1.5 billion to buy the undeveloped Fort Hills oil sands project from UTS Energy Corp. Other big deals have also taken place recently:
A string of oil sands deals have hit the market recently, with international powerhouses stepping up to the plate. For example, China Petroleum & Chemical Corp., also known as Sinopec, in April agreed to pay $4.65-billion for ConocoPhillips’ 9% stake in Syncrude Canada Ltd.; BP plc nabbed a majority slice of Value Creation Inc.’s Terre de Grace project in March; Penn West Energy Trust in May agreed to sell a 45% stake in an oil sands project to China Investment Corp. for $817-million; and PetroChina International Investment Co. bought a 60% stake in Athabasca Oil Sands Corp.’s MacKay River and Dover projects for $1.9-billion last summer.
Clearly, companies are still getting the message that the unfettered expansion of the oil sands is more of a priority for the Canadian federal and Alberta provincial governments than preventing the release of toxic chemicals or greenhouse gases. Furthermore, they must realize that with each new billion in investment, the harder it will be for any future government to shut down these operations, no matter how concerned that government may be about climate change. The creation of new filthy jobs that endanger third parties is a hard thing for politicians to resist; existing filthy jobs are virtually impossible to eliminate, as ongoing asbestos exports from Quebec demonstrate.
It is quite plausible that in ten or twenty years, the effects of climate change will become pronounced and worrisome enough to motivate serious action from countries like the United States and China. Refusing to use fuels as filthy as those derived from the oil sands could be a part of that. Because of that, and because of the acute environmental harm from oil sands operations, it seems probable that future generations of Canadians will see all this money as having been wasted dangerously.
“The best hope to reduce pollution from the sands is probably finding alternative energy sources or cutting consumption. Transforming tar sands into crude is costly as well as dirty: the process only becomes profitable with oil prices in the $60-85 range or higher. Indeed, the recession put 70% of proposed investment there on hold, although half of that has since restarted, according to Jackie Forrest of IHS CERA, an energy-forecasting firm. With just a modest fall in oil prices, the sands’ production would start to go. “
“A coalition of environmental groups has delivered a setback to Total SA, (TOT-N50.77-0.28-0.55%) after a judge temporarily halted a review hearing into the French energy giant’s plans to build a new oil sands mine.
A joint review panel decided to delay the hearing late Tuesday, on the first day of its examination of the Joslyn North Mine, after critics argued that the company’s environmental assessment filings were inadequate.
“The joint panel adjourned the hearing to deliberate upon a number of important and complex rulings on matters including questions of constitutional law and filings of information,†Alberta’s Energy Resources Conservation Board said in a statement.
The panel expects to rule on those matters next Monday and reconvene “no earlier than†Tuesday, the ERCB said.
“We understand that the hearing is a thorough process, and that the panel has to consider several complex issues before the hearing can continue,†Gary Houston, a Total vice-president who serves as panel chair for Joslyn North, said in a statement. “We remain confident in our project and look forward to presenting it to the Joint Review Panel and to the public when the hearing resumes.—
Outlook for oil sands grows
Canada’s oil sands will play an ever increasing role in energy demand as unconventional oil takes a bigger proportion of the total crude mix, the International Energy Agency says in a new forecast.
Unconventional oil is dominated by the oil sands in northern Alberta and the heavy oil reserves in Venezuela. The IEA projected today that oil sands production will climb from 1.3-million barrels a day last year to 4.2-million in 2035, “making an important contribution to the world’s energy security.â€
Over all, China’s huge appetite for fuel will push oil prices up substantially over the next two decades, the agency said in its World Energy Outlook report, Globe and Mail European correspondent Eric Reguly writes.