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Another 4.4 Magnitude Industry Reported Quake in Alberta
Another 4.4 Magnitude Industry Reported Quake in Alberta
Chevron shuts down operations following seismic event near Fox Creek.
Chevron Canada has confirmed that “a magnitude 4.4 seismic event was recorded by seismic monitoring arrays operated by Chevron Canada and Natural Resources Canada” in the Duvernay shale near Fox Creek, Alberta on Saturday.
It’s the second record-breaking industry-reported tremor to hit the region in a year. In January, industry triggered a 4.4 magnitude earthquake in the Duvernay shale.
That event forced the Alberta Energy Regulator to adopt a “traffic light system” to regulate seismic events in the region. The system requires companies to report events greater than a magnitude of 2.0, and to shut down operations once a 4.0 magnitude event is observed nearby.
As a result of the new regulations, Chevron reported the earthquake to the regulator and shut down operations at a natural gas well pad located approximately 27 kilometres south of Fox Creek.
However, the regulator has given the company permission to finish securing the well before it temporarily suspends operations at the site.
A spokesman for Chevron Canada, Lief Sollid, said the company “was installing production tubing in a well on the pad at the time of the event. Multi-stage hydraulic fracturing operations were completed on the eight-well pad on June 5.”
Hydraulic fracturing, the cracking of rock with highly pressurized fluids, can trigger an earthquake days after the event.
Sollid added in an email that “no injuries, property damage or environmental impacts have been reported as a result of the event.”
Since 2013, when companies started to fracture the deep shale with one to two-kilometre-long horizontal wells, the region has experienced a wave of tremors.
The Duvernay shale, or what stock promoters have dubbed the “new millennium gold,” covers a 56,000 square mile region and contains natural gas liquids. An average horizontal well may cost $15 million to drill.
Chevron is part-owner of the Kitimat LNG project, which will operate as an export facility for unconventional natural gas that has been fracked and extracted from British Columbia’s Liard and Horn River basins.
…click on the above link to read the rest of the article…
Missing from Canada’s Political Debate: Natural Security
Missing from Canada’s Political Debate: Natural Security
25-year review of Canada’s eco-stewardship reveals neglect across party stripes.
Canada’s prime minister is pre-campaigning with a strong-on-security message. His government is taking measures designed, among other goals, to protect energy infrastructure from what the RCMP has called “violent environmental extremists.”
As I write, enormous forest fires burning out of control across northern Alberta have done what no activist has accomplished: forced the suspension of oilsands operations.
These events capture a dimension missing from Canada’s security debate: our natural security.
Our natural security is physical. It provides the stable, productive environment that has allowed Canada to prosper. In the form of fields and lakes and forests, and in global exchanges of water and energy, natural security underwrites our economy, our health and our ability to maintain the institutions that serve and protect us.
Every one of Canada’s governments since 1989, including the present one, has expressed strong environmental principles and enacted impressive legislation to protect vulnerable species, defend Canadians against pollution and prevent development from devastating critical ecosystems.
Despite those laws, audits and independent assessments persistently warn us that our natural security is degraded, failing and increasingly undefended. And that should concern Canadians of all political stripes.
The wide gap between our aspirations and actions confronted me again and again as I sought an answer to an apparently straightforward question: “How well has Canada cared for our environment — really?”
The year-long search was commissioned by Tyee Solutions Society, an independent journalism production centre started by the founders of this publication and donor-supported. It collated events, laws, international developments and a wide range of public audits and independent assessments over a period in which five prime ministers from three parties occupied 24 Sussex Drive. All of that information is now available and searchable online.
…click on the above link to read the rest of the article…
Alberta forest fire forces evacuation of oilsands facilities
Cenovus and CNRL shut down operations as precautionary move
Cenovus Energy and Canadian Natural Resources Limited have evacuated their facilities within the Cold Lake Air Weapons range, close to Alberta’s eastern border, due to an out-of-control forest fire in the area.
“Yesterday, CNRL evacuated their plant facilities in the Primrose area and then, last night at 11 o’clock, we advised Cenovus in Foster Creek that it would be a good precautionary move to evacuate their personnel as well,” said Leslie Lozinski, spokeswoman for the province’s environmental and resource ministry.
Cenovus evacuated their facilities at Foster Creek because the fire threatened the only road out, which would have made any evacuation of the facility difficult.
Rhona Delfrari, spokeswoman for the company, said there were approximately 1,800 staff on site last night before the evacuation started early Saturday morning. By the afternoon, only a handful of staff were left over to shut down the plant before escaping by helicopter.
“As far as we know right now, there is no threat from the fire to our facilities, it was more about the road being blocked off from the fire,” said Delfrari.
Monitoring the situation
CNRL’s operations in the area are closer to the fire.
Scott Stauth, the company’s vice-president for North American operations said they have shut down “almost all of our operations, but we still have our main facility, which is not in the weapons range, we still have it manned and operating.”
…click on the above link to read the rest of the article…
Oil industry pushing for carbon tax in Alberta
But if heavy emitters are going to pay, they want consumers to share the burden
The biggest players in Canada’s oil and gas industry are urging Alberta’s government to step up its environmental policies and introduce a carbon tax.
Alberta already has carbon pricing, but the program is limited and it will expire in the next few months.
Suncor CEO Steve Williams told a crowd in downtown Calgary on Friday that change is needed in Alberta to improve Canada’s global reputation.
“We’re trying to move Canada to a position of leadership, that’s not how we are viewed around the world at the moment. We are viewed to be quite the opposite,” said Williams.
- How Canada’s provinces are tackling greenhouse gas emissions
- Rising carbon emissions from oilsands a ‘unique’ challenge, federal cabinet told
Suncor, along with fellow Canadian energy company Cenovus, says the time is right for Alberta to address its environmental policies. But they also say if the province adopts a carbon tax, it should be broad based and apply to everyone.
That includes consumers. The idea is that industry will pay a carbon tax, but so too will the average person. That would include having to pay extra at the pumps and on their natural gas and electricity utility bills.
“Absolutely,” said Williams. “A realization by the consumer is really important because if you want energy efficiency, if you want people to change their behaviours and affect the demand side, you have to get to those users.”
Alberta’s next premier, Rachel Notley, will be sworn in this weekend. She’s already facing pressure to address the province’s carbon emissions. Alberta produces 36 per cent of Canada’s total emissions.
Alberta Health Board Fires Doctor Who Raised Cancer Alarms
Alberta Health Board Fires Doctor Who Raised Cancer Alarms
‘I am stunned,’ says Dr. John O’Connor, a veteran presence in First Nations community
An Alberta health board has fired Dr. John O’Connor, the physician who came to national prominence after raising questions about rare cancers in the tarsands region.
The Nunee Health Board Society send O’Connor a letter last Friday saying it no longer required his professional services.
The letter gives no reason why. “I am stunned. It is indescribable. This severing of links, with no reason,” O’Connor told the Tyee.
Since 2000, O’Connor has served as the on-call physician for the remote community of Fort Chipewyan, as well as physician back-up for the community’s nursing station.
Between 2000 and 2007, O’Connor also flew into the community two days a week for in-person consultations.
The Nunee Health Board Society represents the health interests of the small aboriginal community to all levels of government. The board did not respond to a request for comment sent this morning.
O’Connor, an Irish-born physician, came to prominence in 2006 when he raised concerns about a string of rare bile duct cancers and other unusual disorders such as lupus and renal failure that appeared in patients from Fort Chipewyan, which is located 300 kilometres downstream from the tarsands.
Pressed for long-term studies
The bile duct cancer cholangiocarcimona normally appears in one in 200,000 people. In the space of nine years, O’Connor recorded approximately four cases in the region, which has a population of around 1,500.
Scientists don’t know much about the cancer, but suspect it is related to exposure to industrial toxins in water such as polycyclic aromatic hydrocarbons, a common bitumen pollutant.
…click on the above link to read the rest of the article…
Landmark Fracking Case Gets a Supreme Court Hearing
Landmark Fracking Case Gets a Supreme Court Hearing
Oil patch consultant Jessica Ernst alleges Alberta has intimidated landowners.
The Supreme Court of Canada said today that it will hear thelandmark case of Jessica Ernst, which squarely challenges how the Alberta government has treated landowners and regulated hydraulic fracturing.
The decision both stunned and exhilarated the 57-year-old Ernst.
“I’ve always known my case was important for water and all Canadians, that’s why I am taking this legal stand,” said Ernst who lives in Rosebud, Alberta.
“The court will now hear my appeal that provincial energy regulators not be legally immune from violating the Canadian Charter of Rights and Freedoms when trying to intimidate citizens harmed by fracking,” added Ernst. Her stand against the industry and the Alberta government has made her a folk hero throughout North America and parts of Europe.
However, a win at the Supreme Court does not mean that she will win her lawsuit, explained Ernst to the Tyee. “It means I would be sent back to the lower court in Alberta to begin my lawsuit against the Alberta Energy Regulator. It means still a very long, hard, expensive journey.”
The Supreme Court only hears about four per cent of all civil Charter claims brought to its doorstep.
Eight years ago, oil patch consultant Ernst sued Alberta Environment, the Energy Resources Conservation Board (ERCB) and Encana, one of Canada’s largest unconventional gas drillers, over the contamination of her well water with hydrocarbons and the failure of government authorities to properly investigate the fouling of groundwater.
…click on the above link to read the rest of the article…
Emails: How State Department Secretly Approved Expanding Piece of Enbridge’s “Keystone XL Clone”
Emails: How State Department Secretly Approved Expanding Piece of Enbridge’s “Keystone XL Clone”
DeSmogBlog has obtained dozens of emails that lend an inside view of how the U.S. State Department secretly handed Enbridge a permit to expand the capacity of its U.S.-Canada border-crossing Alberta Clipper pipeline, which carries tar sands diluted bitumen (“dilbit”) from Alberta to midwest markets.
The State Department submitted the emails into the record in the ongoing case filed against the Department by the Sierra Club and other environmental groups in the U.S. District Court for the District of Minnesota. Collectively, the emails show that upper-level State Department officials hastened the review process on behalf of Enbridge for its proposed Alberta Clipper expansion plan, now rebranded Line 67, and did not inform the public about it until it published its final approval decision in the Federal Register in August 2014.
According to a March 17, 2014 memo initially marked “confidential,” Enbridge’s legal counsel at Steptoe & Johnson, David Coburn, began regular communications with the State Department on what the environmental groups have dubbed an “illegal scheme” beginning in at least January 2014.
Image Credit: U.S. District Court for the District of Minnesota
Environmental groups have coined the approval process an “illegal scheme” because the State Department allowed Enbridge to usurp the conventionalpresidential permit process for cross-border pipelines, as well as the standard National Environmental Policy Act (NEPA) process, which allows for public comments and public hearings of the sort seen for TransCanada’s KeystoneXL pipeline.
Further, the scheme is a complex one involving Enbridge’s choice to add pressure pump stations on both sides of the border to two pipelines, Enbridge Line 3 andEnbridge Line 67, to avoid fitting under the legal umbrella of a “cross-border” pipeline.
…click on the above link to read the rest of the article…
Harper’s Folly: Canada Losing $30+ Billion/Year on Tar-Sands Oil
Harper’s Folly: Canada Losing $30+ Billion/Year on Tar-Sands Oil
Oil is our most-precious commodity as fuel for the global economy. It is also becoming a scarce commodity, as global production has flattened, while global demand continues to climb relentlessly, everywhere in the world except for the dying economies of Europe and North America. It is a classic “seller’s market.”
Then we have Canada. Under the Harper regime; Canada has rapidly/recklessly ramped-up production of tar sands oil (vying with U.S. shale-oil production for the title of “world’s dirtiest oil”). In less than 20 years; tar sands production has increased by a factor of ten, from less than 200,000 barrels per day to over 2 million barrels per day (mb/d) in 2014. This amounts to annual tar sands production of roughly 750 million barrels.
Thanks to this reckless over-production; Canadian tar sands oil production has created three ultra-expensive/ultra-inefficient bottlenecks for itself:
a) Insufficient refining capacity
b) Insufficient shipping/pipeline infrastructure
c) Insufficient skilled labour
Because of (a) and (b); Canada’s tar sands oil has been sold at “discounts” of up to $40/barrel. Because of (c) and other factors;production costs for tar sands oil (which was already the world’s most-expensive) continue to soar.
Legions of workers must be flown in, housed and fed, adding to costs. Competition for labour is so fierce that some companies now subsidize mortgage payments on $600,000 houses to entice workers to stick around.
The combination of a grossly insufficient labour force, and grossly insufficient infrastructure to support this production is that while it is “the lowest priced oil in the world”, currently trading at a pathetic $36.02 per barrel, it is the most-expensive oilin the world to produce.
…click on the above link to read the rest of the article…
Wolves Scapegoated While Alberta Government Sells Off Endangered Caribou Habitat
Wolves Scapegoated While Alberta Government Sells Off Endangered Caribou Habitat
Culling Alberta’s wolves without prioritizing caribou habitat protection and restoration is like “shoveling sand,” according to Mark Hebblewhite, associate professor of ungulate habitat biology at the University of Montana.
Hebblewhite says the Alberta government is sponsoring a wolf cull without doing the one thing that could possibly scientifically justify it: conserving and restoring critical caribou habitat.
“That’s the tragedy here: the Alberta government blew the opportunity to do the right thing,” he said.
“It’s all shoveling sand without real commitment to habitat conservation.”
Scientists have warned of Alberta’s caribou losses for decades and in recent years have argued the majority of the herds are endangered with some facing an imminent risk of local extinction. Provinces have until 2017 to formulate provincial caribou recovery plans under the new federal caribou recovery strategy released in 2012.
The goal for each province is to maintain 65 per cent undisturbed habitat in all caribou ranges, according to Duncan MacDonnell, public affairs officer for Alberta Environment and Sustainable Resource Development (ESRD).
“It is ESRD’s responsibility to implement recovery plans,” for Alberta, MacDonnell said, adding that since 2004 the province has had a wolf cull in place “to hold the line while the habitat recovery plans take place and are implemented.”
Since 2006 more than 1,000 wolves have been shot in the Little Smokey and A La Peche caribou ranges.
…click on the above link to read the rest of the article…
Canada Housing, Office Market Mauled by Oil, Layoffs – but Vancouver Bubble Still Soars
Canada Housing, Office Market Mauled by Oil, Layoffs – but Vancouver Bubble Still Soars
Back in December, the Bank of Canada said home prices were overvalued by as much as 30% and posed an “elevated” risk to the Canadian financial system. In January, Deutsche Bank found that Canada’s housing market was, more realistically, 63% overvalued.
In greater Vancouver, the “benchmark” price of all types of homes (detached, townhouse, and apartment) in March rose 7.2% from a year ago to C$660,700, according to the Real Estate Board of Greater Vancouver. Detached homes jumped 11.2% to C$1.05 million; and in Vancouver West, 12.3% to a breathtaking C$2.4 million.
Those are the Board’s “benchmark” prices. The average price for detached homes in Vancouver soared 16% from a year ago, surpassing $1.4 million for the first time. Transactions skyrocketed 54%; supply plunged 15%. Prices were doped by low interest rates, limited supply, and foreign investors. This market is hot.
But the oil patch of Canada is skidding into serious trouble.
“The recent international price war over oil has demonstrated the risks and dangers of relying on energy revenue to fund public services,” Alberta’s government explained on Thursday, as it presented a C$43.4 billion budget for fiscal 2015/2016. It projects arevenue decline of C$5.6 billion!
It’s “simply irresponsible” to rely on unstable oil revenues “to fund health, education, and other vital public services that Albertans depend upon,” the government said.
And things would change. Energy revenue would from now on – if they ever return to prior levels – be treated as “windfall” that would at least in part go into savings. And there would be a slew of new taxes and fees, such as a bump in gasoline taxes, steeper income taxes for high-income earners, and a new health-care levy. With these measures, the government hopes to balance the budget three years from now.
…click on the above link to read the rest of the article…
Low Oil Prices Not Enough To Kill Off Oil Sands, Yet
Low Oil Prices Not Enough To Kill Off Oil Sands, Yet
On Friday I visited the University of Alberta in Edmonton, where falling oil prices have brought a record provincial budget deficit despite aggressive tax increases and spending cuts. Here I pass along some of what I learned about how the plunge in oil prices is affecting Alberta’s oil sands operations.
A couple of factors have cushioned Canadian oil producers slightly from the collapse in oil prices in the U.S. First, while the dollar price of West Texas Intermediate has fallen 45% since June, the Canadian dollar depreciated against the U.S. dollar by 18% over the same period, and now stands at CAD $1.26 per U.S. dollar. Since the costs of the oil sands producers are denominated in Canadian dollars, the currency depreciation is an important offset. There has also been some narrowing of the spread between synthetic and other crudes. As a result of these factors, the University of Alberta’s Andrew Leach calculated that when WTI was selling for US $50 a barrel, Canadian producers were receiving CAD $60 per barrel of synthetic crude.
Related: U.S. Oil Glut Story Grossly Exaggerated
Source: Andrew Leach.
Oil sands and U.S. tight oil production have been the world’s primary marginal oil producers in recent years, by which I mean the key source to which the world could turn in order to get an additional barrel of oil produced. Ultimately, in this regime, it is the long-run marginal cost of the most costly producing operation that puts a floor under the price of oil.
…click on the above link to read the rest of the article…
The Canadian Housing Bubble Has Begun To Burst
The Canadian Housing Bubble Has Begun To Burst
Don’t look now but slumping crude prices are hitting the Canadian housing market like a freight train. Energy accounts for 10% of Canadian GDP and around 25% of exports and the swift fall in oil prices is having a profound effect in the nation’s oil producing regions. Take Calgary for instance, where single-family home sales fell 34% last month. As the following chart shows, Alberta derives some 30% of its provincial revenues from energy royalties and as one TD analyst quoted by the Calgary Herald recently noted, “the effects of significantly lower oil prices had already turned up in resale activity, with sales in Calgary and Edmonton down more than 40 per cent and 30 per cent respectively, from October to January [and] as resale activity slows, prices usually follow.”
Depressed crude prices will create a $7 billion annual revenue shortfall for the province while GDP growth, which had been running at around 4%, is expected be just under half that this year, withsome analysts predicting the economy will contract. Here’s CIBC’s outlook for instance:
The Alberta government’s own assessment of the economic situation is deteriorating rapidly.
From the Alberta fiscal update:
…click on the above link to read the rest of the article…
Energy companies on the ropes as investors look for deals
Behind the scenes of the oil shock
So far 2015 has not been a banner year for the energy sector. Budgets have been slashed, earnings are down and jobs are being cut.
The mood in Alberta is tense.
Behind the scenes though, it’s a different story. Opportunities are being sensed, calls are being made, flights are being booked to Calgary.
Bruce Edgelow. vice-president of energy with ATB Financial, says his phone has been ringing off the hook with investors both inside and outside Canada looking to take advantage of the current downturn in the oilpatch.
ATB is a provincially-owned financial institution that lends heavily to Alberta businesses, including many in the oil and gas sector.
Edgelow says the calls have been coming from investors that would like to relieve ATB of some of the riskier loans it has made to the oilpatch.
…click on the above link to read the rest of the article…
Did Alberta Just Break a Fracking Earthquake World Record?
Did Alberta Just Break a Fracking Earthquake World Record?
Hydraulic fracturing, a technology used to crack open difficult oil and gas formations, appears to have set off a swarm of earthquakes near Fox Creek, Alberta, including a record-breaking tremor with a felt magnitude of 4.4 last week.
That would likely make it the largest felt earthquake ever caused by fracking, a development that experts swore couldn’t happen a few years ago.
Fracking operations in British Columbia’s Montney shale generated similar seismic activity of that magnitude last year, and earthquake scientists at Ontario’s Western University are still analyzing the two events to see which is the largest.
“The location of the earthquake is consistent with being induced by hydraulic fracturing operations,” confirmed Peter Murchland, a spokesman for the Alberta Energy Regulator.
“The AER regards all changes in seismicity that have the potential to indicate an increased risk associated with hydrocarbon production seriously,” Murchland added.
Jeffrey Gu, a physics professor at the University of Alberta, said the Alberta Geological Survey and other agencies were investigating the Fox Creek swarm, which hit about 260 kilometres northwest of Edmonton. But Gu said he could not disclose their findings at this time. He offered no details on the scale or scope of the investigation.
…click on the above link to read the rest of the article…
Tanking Asia Gas Prices Makes BC LNG ‘Not Viable,’ Expert Says
Tanking Asia Gas Prices Makes BC LNG ‘Not Viable,’ Expert Says
A liquified natural gas industry, as currently promoted by British Columbia’s Liberal government, is not viable at current natural gas prices, and the proposed industry tax regime actually “gives a subsidy to the LNG industry,” according to a royalty expert.
Jim Roy, a former royalty advisor to the Alberta government of Peter Lougheed and now a private Edmonton-based consultant, said the profitability of any liquefied natural gas industry in the province in truth depends on artificially high natural gas prices in China.
The natural gas price in B.C. needs to be less than half the price of natural gas in China for the nearly 24 proposed LNG projects in the province to be economic, but that differential is rapidly narrowing, Roy said.
Not one proposed LNG project in B.C. has made a final investment decision yet.
Since the advent of falling oil prices, the spot price for natural gas — the so-called Japanese Korea Marker — has plummeted. Global LNG prices are tied to oil prices.
When the B.C. government announced its liquefied natural gas push in 2012, the volatile Asian gas price was as high as $16 per million British Thermal Units (MMBtu), or more than triple North American prices.
…click on the above link to read the rest of the article…
