Executives from the biggest oilsands companies in Canada say worries about getting their products to market are starting to ease in the wake of the regulatory approval of Enbridge Inc.’s $9-billion Line 3 pipeline replacement project. Enbridge company logos are seen at the company’s annual meeting in Calgary. (Photo by THE CANADIAN PRESS)

No more retrofits for carbon capture and storage at Boundary Dam: SaskPower

CALGARY — Executives from the biggest oilsands companies in Canada say concerns about getting their products to market are easing in the wake of regulatory approval of Enbridge Inc.’s $9-billion Line 3 pipeline replacement project.

The project to add about 375,000 barrels per day of export capacity into the United States cleared its last major regulatory hurdle at the end of June when it was conditionally endorsed by Minnesota state officials.

The decision, when combined with a deal by the federal government to buy the Trans Mountain pipeline and its expansion project for $4.5 billion, removes part of the uncertainty standing in the way of considering major expansion projects again, said executives from Suncor Energy Inc., Canadian Natural Resources Ltd., Imperial Oil Ltd., Husky Energy Inc. and Cenovus Energy Inc.

However, such decisions also hinge on improvements to federal and provincial regulatory predictability and taxation levels, they said while taking part in a panel at the TD Securities Calgary Energy Conference on Tuesday.

“Our view is expanded market access is necessary but not sufficient to ensure the competitiveness of our industry,” said Imperial CEO Rich Kruger.

“The real concern we have to work on … is the regulatory and the fiscal environment has to improve. We have to be more competitive,” agreed Canadian Natural executive chairman Steve Laut.

Recent increases in the U.S. benchmark price for crude oil to about US$75 per barrel from around US$55 last year are swelling North American oil company coffers but few are investing in increasing production, which means prices could soon rise to US$100 or more per barrel, said Peter Tertzakian, executive director of the ARC Energy Research Institute in Calgary.

“The probability of another price hike is quite high and I think the market is itching to take the prices to US$100. I think it could go well over US$100,” he said at the conference.

If prices continue at current levels this year, almost $30 billion more revenue will go to Canadian energy companies than in 2017, he said, but most companies are looking at giving it to the shareholders through share buybacks or dividend increases, with only a few thinking about more drilling or buying competitors.

He said spending in Canada fell off over the past few years because companies were unable to sell their shares to investors due to low energy prices, and a successful but inaccurate campaign by environmentalists to suggest the world won’t need oil after the middle of the next decade.

Investors around the globe have also been reluctant to invest in oil and gas, leading to falling supply and higher prices, said Suhail Al Mazrouei, the president of OPEC and energy minister for the United Arab Emirates, in a speech at the conference.

That’s why the Organization of Petroleum Exporting Countries and partners including Russia recently agreed to boost production by one million barrels per day, he explained.

“We wouldn’t do it if we were just happy with the higher prices,” he said.

“We would wait until the end of the year when the prices will be more than US$100, but that is not the target, the target is to have a balanced market supply and demand and hope that investors … make a return on their investment.”

Husky CEO Rob Peabody said his company expects to grow its overall oil and gas production by about five per cent per year going forward, adding it has excess pipeline capacity now but it will need more room for its growing western Canadian heavy oil production by about 2023.

Suncor has sufficient contracted pipeline space as production ramps up at its recently completed 194,000-barrel-per-day Fort Hills oilsands project, but it will hold off on adding other major projects until it’s satisfied that all market access, regulatory and fiscal issues are more clearly understood, said chief operating officer Mark Little.

Just Posted

Eight dogs found in Innisfail hotel room were kept in cages

Eight dogs, kept in cages in a small hotel room in Innisfail… Continue reading

Severe thunderstorm watch for Central Alberta

Thunderstorm watch covers large area including Sylvan Lake to Stettler

Bird on a wire causes electrical problems in Red Deer

City workers put protective covers on line

WATCH: Kayakers go over Ram Falls south of Nordegg

Two take 30-metre plunge, post video of thrill ride

Count shows slight decrease in Red Deer’s homeless

In two years, the number of homeless in Red Deer has decreased… Continue reading

WATCH: Cirque ZUMA ZUMA puts on a show at Westerner Days

ZUMA ZUMA performs three times a day during Westerner Days

Four-car crash, including RCMP vehicle, on Highway 2

Two sheriff vehicles were also involved in the collision

Divers hunt for 4 after Missouri duck boat sinks, killing 13

BRANSON, Mo. — Divers are searching Friday for four people still missing… Continue reading

WATCH: Red Deer’s noxious weeds are a goat’s dietary delight

Piper Creek Community Garden gets chemical-free weed control

‘Amazing Race Canada’ competitors face B.C. challenge

They drove Corvettes, mastered falconry basics, and ate blueberry pie in the Cowichan Valley

From hot to not? The Baloney Meter weighs in on Scheer’s economy claims

OTTAWA — “Justin Trudeau inherited a booming economy, but he’s squandering it.… Continue reading

Scathing suicide inquiry finds gaps, shortcomings at Royal Military College

OTTAWA — Members of a board of inquiry into three suicides at… Continue reading

Premiers strike deal to allow increased flow of beer, alcohol across borders

ST. ANDREWS, N.B. — Canada’s premiers are set to wrap up their… Continue reading

Trump ready to hit all Chinese imports with tariffs

President Donald Trump has indicated that he’s willing to hit every product… Continue reading

Most Read


Five-day delivery plus unlimited digital access for $185 for 260 issues (must live in delivery area to qualify) Unlimited Digital Access 99 cents for the first four weeks and then only $15 per month Five-day delivery plus unlimited digital access for $15 a month