Weekly Round Up - 1.3.2012

 

Did you know…

Thirty-five percent of the world’s oil tanker shipments, or almost 20% of oil traded worldwide travels through the Strait of Hormuz? Located between Oman and Iran, the Strait connects the Persian Gulf with the Gulf of Oman and the Arabian Sea. The United States Energy Information Administration labels it as the "the world's most important oil chokepoint with an oil flow of almost 17 million barrels per day in 2011." Current politics regarding the Strait have sent oil prices higher.Read more…
 
Oil – $102.52 (Last Week $99.80)            Natural Gas - $2.95 (Last Week $3.03)
 

Oil & Gas

Where analysts see oil prices in 2012

Brent crude will average $105 (U.S.) a barrel next year, not far below this year’s record high average near $111, a Reuters poll found. A quarter of analysts have reduced their forecasts since a similar poll a month ago because of worries about the impact of the euro zone debt crisis on economic growth. Read more…
 

Alberta drilling rights sales hit record $3.54 billion

The final 2011 auction of Alberta Crown drilling rights brought in $146 million on Wednesday, taking the calendar year total to a record $3.54 billion. Alberta's record earnings from this year's sales of drilling rights will probably remain unbroken in 2012 as buyers attempt to explore and develop their lengthy lists of prospects. Read more…
 

Drilling activity cresting high on oil prices

The number of drilling rigs active in Western Canada has reached a five-year high on producers chasing after lucrative oil and liquids rich natural gas targets in fairly established plays. Read more…
 

Saskatchewan's final land sale of 2012 draws just over $20Million

Saskatchewan’s final land sale of 2012 this week produced $20.8 million in bonus bids, bringing the calendar year-end total to $248.8 million, making 2011 the fourth best on record for land sale revenue.
 

Oil patch pushes for immigration change

Alberta is facing a shortage of 77,000 workers within the next 10 years. The oil sands’ projected growth is a key force behind the deficit, with bitumen production expected to double by 2020 as companies pour billions of dollars into their projects. Read more…
 

Why U.S. is still king for Canadian oil

For long-term access and competition in a pretty vibrant market, the high priority is to get access to these refineries in the Gulf Coast. China doesn’t have enough of the right refinery capacity to process Canadian heavy oil, while California’s heavy oil refineries hungry for new supplies will likely seek out Canadian barrels, regardless of its anti-oil sands policies. Read more…
 

$72B in lost revenue at stake in B.C. Northern Gateway pipeline

Oil producers could lose $72 billion over nine years if a pipeline to carry Alberta bitumen to the West Coast isn't built, a new report for the Alberta government says as community hearings for the proposed Enbridge Northern Gateway project are about to begin this month in British Columbia. Read more…
 

Oil jobs the new gold as thousands join N.D. rush

Williston lies just 1,000 kilometres from Calgary, and an easy day’s drive from Edmonton for the flow of men and machinery that have been dispatched here. Read more and more…
 

PetroChina takes full control of Alberta oil sands project

Athabasca Oil Sands Corp. has exercised its option to sell its remaining 40-per-cent interest in the MacKay River oil ands project to a unit of Chinese oil giant PetroChina for about $680-million. Read more…
 

2011 in review: Big year for foreign deals in oilsands

Just when it looked like Imperial Oil Ltd.'s sanctioning last week of an $8.9-billion expansion of its Kearl mine might be the final big oilsands deal of 2011, Osum Oil Sands Corp. announced late Friday it had raised $500 million from a private placement with investors including the Singapore government. Read more…
 

Natural gas liquids supply increase challenging infrastructure

The propanes, butanes and condensates are used by industry in petrochemical facilities, gas processing and to make bitumen flow smoothly through pipelines. The rising volumes of liquids rich gas will require more natural gas processing facilities. Read more…
 

Costs rise to $28.5 billion for Imperial Oil's Kearl project

Enhanced tailings pond provisions and new pipeline plans have increased costs at Imperial Oil Ltd.’s Kearl oilsands mine by billions of dollars over the life of the project, the company said Wednesday. Costs per barrel have gone up 24 per cent to $6.20 from a previously publicly released estimate of $5. Read more…
 

Natural gas storage levels reach record highs

Without a prolonged blast of frigid weather to draw up heating demand, natural gas prices will have little recourse from the scourge of high storage by spring. Read more…
 

Fracking fears spur review of oilpatch regulations

The Alberta government is pushing ahead with a regulatory overhaul to handle an expected boom in light oil production from resource plays, attributed to the application of advanced oilfield technology. Read more…
 

Engineering and Construction

Construction gets underway on $3.25 billion potash mine in Saskatchewan

A German fertilizer company has started construction on a $3.25 billion potash mining operation in southern Saskatchewan, which is the first greenfield potash project to be developed in the province in more than forty years. Read more…
 

Saskatchewan mining industry projected to benefit from more than $50 billion of capital investment over the next 20 years

Canada's mining industry has the potential to make almost $140 billion of capital investment in Canada over the next five years and it's anticipated Saskatchewan will benefit from more than $50 billion of capital investment over the next two decades. Mining is a $7.1 billion industry in Saskatchewan and the province benefited from $3.1 billion in capital expenditures in 2010, the largest recipient of mining investment in Canada last year. Read more…
 

Canada's housing starts slow in November

New home building across Canada dropped by a sharp 13 per cent in November as the volatile sector that represents condos and apartments showed declines, but there was still no sign the red-hot Canadian housing market is poised for a tumble, analysts said. Read more…
 

Saskatchewan building permits rise, British Columbia permits plummet

Total permit values in British Columbia on a seasonally adjusted basis in October 2011 were $703 million, down 39.9 per cent from October 2010. Saskatchewan's building permits were up 22.4 per cent from October 2010 to October 2011. Read more…
 

New initiative intended to increase immigration

The federal government is launching a new initiative to increase the number of construction workers emigrating to Canada, while reducing the backlog for those obtaining permanent residency under the federal skilled worker program. Read more…
 

Construction associations support replacing Building Canada plan

Infrastructure Canada announced the launch of a formal engagement process that will bring together the Government of Canada, provinces, territories, the Federation of Canadian Municipalities and others to develop a new long-term plan for public infrastructure, beyond the expiry of the Building Canada plan. Read more…
 

Bank of Canada warns condo boom could be ending

In its December economic review, the central bank said that "certain areas" of the housing market could see prices fall as the economy weakens. Read more…
 

Canadian Pacific expanding ability to move oil from Saskatchewan

Shipping out of an oil loading facility that CPR will build in Estevan in southeastern Saskatchewan is part of a trend that is seeing more crude moving by rail as a flexible alternative given delays in adding new pipeline capacity. Read more…
 

Economics

With highest levels of economic freedom in North America, Albertans enjoy higher standards of living while Ontario and Quebec lag behind

This year’s report found that on average, levels of economic freedom have slightly increased among Canadian provinces while declining in many U.S. states. After Alberta, Saskatchewan was the second highest-ranked Canadian province, but just 32nd overall, with Newfoundland & Labrador third among provinces and 37th overall. Read more…
 

A stronger U.S. economy should underpin Canada’s growth in 2012

However, despite the persisting significant risk of a meltdown in Europe, economic activity in the United States, the market for almost 20% of Canada’s total output appears to be gaining momentum. This is reflected by a gradual strengthening of consumer spending and a moderate improvement in housing demand driven to a significant degree by a stronger pattern of private sector employment growth. Also, business investment has benefitted from very stimulative monetary policy and a solid 14.6% increase in after tax profits. Read more…
 

Odds of another financial crisis on the rise: Bank of Canada

The Bank of Canada is warning that the strength of the global financial system has “deteriorated significantly” since the summer because of the worsening European debt crisis and weaker world-wide economic outlook. Read more…