Oil Sands Report: Risks as Great as Gulf Spill

New upgraders that process heavy Canadian oil will be built in North American coastal markets where labor and capital are cheaper than in Alberta, Irving Oil Corp. President Mike Ashar said. Building upgraders in Alberta, where bitumen is mined or extracted from the oil sands, doesn’t make sense anymore because labor and equipment costs are so high there that workers should be focused on production, said Ashar, whose company operates Canada’s largest refinery, in Saint John, New Brunswick.

CALGARY • China’s energy giants are ramping up spending in Alberta’s oil sands and committing billions to resource play developments just as their Canadian and international counterparts check growth prospects in Western Canada.

Abandoning this industry to oil producing countries with lower standards is not leadership CALGARY — The inability to get oil sands crude to the right markets is costing the Canadian economy dearly, according to a new report paid for by the Saskatchewan government. Each stalled pipeline project means a loss to the Canadian economy of between $30-million and $70-million every day, said the report penned by the Canada West Foundation, a Calgary-based think-tank.

CALGARY — A research paper is reinforcing the idea that Canada’s resource industry is at risk of being left behind internationally if it doesn’t find a way to get oil to receptive markets in the Pacific Rim. The report from the School of Public Policy at the University of Calgary says demand for heavy oil from Alberta’s oil sands lies primarily in southeast Asia, but warns the window of opportunity will begin to close. Author Michal Moore says Canada needs to find a way to get into those markets in the next two to five years.

CALGARY — Pipeline politics overshadowed performance in the Canadian energy industry through the first three months of this year, as prices for the country’s heavy crude oil slumped, pointing to a string of corporate results that will be mediocre at best. As companies roll out first-quarter numbers in the coming weeks, however, sentiment among producers over the commodity prices has turned more bullish, with both bitumen and natural gas climbing to several-month highs.

Suncor Energy Inc is expected to shelve plans for a multibillion-dollar oil sands processing plant in northern Alberta when it announces the fate of the facility in the coming days, blaming a forecast for weakening returns. The decision by Canada’s largest oil company on its long-delayed and partially built Voyageur upgrading plant in Alberta is one of a pair of major developments in the oil sands due this week, the other being the targeted start-up of Imperial Oil Ltd’s Kearl mining project after about four years of construction.

The rush to export liquefied natural gas from North American shores will help drive asset deals, mergers and acquisitions in 2013, part of a wave of global consolidation led by cash-flush national oil companies that could see several Canadian companies taken out. Watch for “bigger and bolder” moves by state-run behemoths this year, “as the share of oil and gas consumption by Asian countries continues to rise and pressure on Asian NOCs to ‘go global’ increases,” said Neil Beveridge, a senior analyst at Sanford C. Bernstein in Hong Kong.

It will take focus and determination over the next several years to open new markets. And that is job one for my government CALGARY, Alberta — Alberta’s premier warned on Thursday that the Western Canadian province faced a $6 billion shortfall in revenue due to deeply discounted prices for its crude oil but offered no specifics on how to prevent falling deeper into the red.