23rd April 2015

TransMountain pipeline ‘will go forward’ if approved, Kinder Morgan Inc CEO says – by Claudia Cattaneo (National Post – April 22, 2015)

The National Post is Canada’s second largest national paper.

HOUSTON – Saying he is “astounded” by opposition in British Columbia to his company’s proposed pipeline expansion, the head of U.S. energy infrastructure giant Kinder Morgan Inc. warned his company will forge ahead with construction starting in the summer of 2016, if the project receives Ottawa’s approval.

Richard Kinder, chairman and CEO of Houston-based Kinder Morgan, said Wednesday the increasingly vocal opposition is part of an organized movement to use pipeline permits across North America as a “choke point.”

“I believe that Canada, like the U.S., has the rule of law, and I think if you have a valid federal decision to go forward, the project will go forward,” he said at the IHS CERAWeek conference here. “I think we will get this permitted. We intend to get it build. And we hope to see it in service in the third quarter of 2018.”

The approach is in contrast to that of Calgary-based Enbridge Inc., which has been treading carefully despite receiving a federal permit to build its Northern Gateway pipeline last year. The company has yet to announce a start-up date as it works to reduce opposition for its own Alberta-to-West coast pipeline project. Read the rest of this entry »

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21st April 2015

Recent Trends in Cuba’s Mining and Petroleum Industries (United States Geological Survey – April 2015)

http://www.usgs.gov/

On December 17, 2014, President Obama announced that the United States would begin discussions to restore diplomatic relations with the Government of Cuba and embark on a longer term process of normalization of relations between the two countries.

The U.S. Government had officially severed diplomatic relations with Cuba in 1961 in response to political
changes after the Cuban Revolution. In 1962, President Kennedy declared an embargo on all trade between the United States and Cuba, which was implemented through regulations published in 1963.

On January 15, 2015, the U.S. Departments of Commerce and the Treasury published regulatory amendments to the Cuba sanctions (U.S. Department of the Treasury, 2015) in accordance with President Obama’s December 2014 policy announcement (The White House, 2014). These measures made changes in the implementation of the embargo but did not lift the embargo.

Most transactions involving Cuba, including private and public investment in mineral production, continue to be prohibited. This Fact Sheet provides information regarding the current supply of and demand for mineral commodities produced in Cuba (fig.1). Read the rest of this entry »

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21st April 2015

Chair of U.S. senate energy committee says Washington needs adapt to new era of low oil prices – by Claudia Cattaneo (National Post – April 21, 2015)

The National Post is Canada’s second largest national paper.

HOUSTON, TX – Canadians are not the only ones frustrated with U.S. President Barack Obama’s energy policy. c

Alaska Senator Lisa Murkowski and ConocoPhillips CEO Ryan Lance said Washington needs to adapt to the new era of low oil prices by speeding up regulatory approvals and lifting a ban on oil exports that is imposing virtual “sanctions” on already ailing domestic producers.

Murkowski, chair of the U.S. senate’s energy committee, said many U.S. federal policies are “alarmingly deficient and outdated…[and] in need of modernization and reform.”

The last time the U.S. Congress passed a major energy bill was in 2007, before Obama took office and new extraction technologies boosted domestic oil and gas production, introducing an era of U.S. energy abundance, she told a meeting of global oil leaders gathered here this week for the IHS CERAWeek conference. More than 2,800 delegates from around the world are meeting in Houston to discuss strategies to manage through oil’s current down cycle.

Obama has said he supports an “all-of-the-above energy policy,” but has chastised fossil fuel sources like Canada’s oilsands while boosting green energy as part of his focus on climate change. Read the rest of this entry »

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21st April 2015

Teck Resources Ltd slashes dividend as commodity prices plummet – by Peter Koven (National Post – April 21, 2015)

The National Post is Canada’s second largest national paper.

Teck Resources Ltd. has finally slashed its dividend, a move many analysts thought was inevitable as the company grapples with weak coal prices and high spending at its Fort Hills oil sands project.

The Vancouver-based miner announced on Tuesday that it cut its semi-annual dividend by two-thirds. The payout is now 15 cents a share, down from 45 cents.

The move will help keep Teck’s balance sheet in solid condition as it continues its $2.9 billion investment in Fort Hills. It has only spent about $900 million so far, meaning there is $2 billion to go. First production is expected in late 2017.

Teck also reported weaker-than-expected first quarter results on Tuesday. Adjusted profit dropped 39 per cent year-over-year to $64 million, or 11 cents a share, which was below the consensus analyst estimate of 15 cents.

Positively, the company’s liquidity remains strong. Teck currently holds $1.4 billion of cash, and it has an additional US$3 billion available in a revolving credit facility. Read the rest of this entry »

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13th April 2015

On land title, which road will aboriginal groups take? – by Jeffrey Simpson (Globe and Mail – April 11, 2015)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

It will take some time to measure the impact of the Supreme Court of Canada’s judgment on aboriginal title, and the significant additional powers it gives aboriginal groups with that title.

The judgment, nine months ago, involved the Tsilhqot’in Nation, with about 3,000 people. They had been fighting commercial logging since 1983 in the territory they claimed as theirs.

Courtesy of the Supreme Court, their aboriginal title was affirmed, which meant in layman’s language almost a de jure veto over anything done in that territory. The ruling was, of course, hailed by aboriginal leaders everywhere, but especially in British Columbia where there are few treaties.

Yes, the court said governments could assert some power to allow a development with a “compelling and substantial public purpose.” But in the real world, as opposed to the one of legal reasoning, such a showdown between a government’s “compelling and substantial public purpose” and an empowered aboriginal group would be messy at best and a stalemate at worst. A government would be very reluctant to put the amorphous “public interest” against a narrow but determined aboriginal one. Read the rest of this entry »

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10th April 2015

Aboriginal Leader Says Consult or Risk Canada Resource Gains – by Greg Quinn (Bloomberg News – April 10, 2015)

http://www.bloomberg.com/

Canada’s top aboriginal leader warned that the country’s push for resource projects will be bogged down in legal and political strife unless governments consult more on revenue sharing and environmental protection.

“People won’t invest in Canada if there is instability, if there is no partnership with indigenous peoples,” Perry Bellegarde, leader of the Assembly of First Nations, said Wednesday in an interview at Bloomberg’s Ottawa office. He said disputes over resource rights with aboriginals will affect most of the estimated C$675 billion ($536 billion) of projects over the next decade.

Aboriginal power is growing, as was shown in recent court victories involving land-claim issues and the Idle No More street protests that began about two years ago, said Bellegarde, who in December was elected to head the group representing about 900,000 people in 634 communities. Leaders of Canada’s First Nations will choose from a range of political and legal “alternatives” if the government continues to fail to “consult and accommodate” aboriginals, he said.

“So how do you stop that? Check your political strategy, check your legal strategy, and people will probably get on the land to protect the land,” he said. The pressure will also include more political lobbying in the run-up to the federal election expected in October, Bellegarde said. Read the rest of this entry »

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9th April 2015

Shell-BG Group merger a game changer for B.C.’s LNG industry – by Brent Jang (Globe and Mail – April 9, 2015)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

VANCOUVER — A global powerhouse in liquefied natural gas has emerged in a blockbuster merger that is expected to reshape British Columbia’s LNG industry.

Royal Dutch Shell PLC’s £47.7-billion ($88-billion) deal to buy BG Group PLC creates a liquefied natural gas giant, and will allow the combined company to choose which energy projects to keep or jettison within B.C.’s fledgling LNG sector. The merger will bolster the Shell-led LNG Canada project in Kitimat while hampering BG’s chances near Prince Rupert, as pressure mounts for players to either drop out or consolidate to cut costs.

There are 19 LNG proposals in B.C., though only three or four projects at most have a realistic chance to survive amid fierce global competition and a looming glut of LNG supplies. “We’re going to see some consolidation amongst the LNG projects. There really isn’t room for all of them,” BMO Nesbitt Burns Inc. energy analyst Randy Ollenberger said in an interview.

Premier Christy Clark describes the LNG industry as a once-in-a-generation opportunity to improve the province’s finances and create tens of thousands of jobs. Read the rest of this entry »

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9th April 2015

Piping ever more petroleum: The world needs Canada’s oil and gas – by Russ Girling (National Post – April 9, 2015)

The National Post is Canada’s second largest national paper.

Canada and the rest of the world will transition to a less carbon-intensive energy future – it’s already happening – social and economic pressures will dictate that.

However, here in Canada and the United States, despite the rhetoric you may hear, we will continue to consume significant quantities of oil to fuel the 280 million vehicles that North Americans need to start every morning.

And as we transition off coal-fired electricity, it will be replaced largely by natural gas, and as a result, demand for natural gas will grow even higher.

And at the same time, global demand for oil and gas will continue to grow, driven by a massive population in developing economies striving to obtain a lifestyle for their families similar to what we enjoy here in Canada. For example, there are 1.3 billion people in China that want to have the same quality of life that you and I have.

The International Energy Agency – a group of 28 countries cooperating to provide the world’s most credible outlook for energy demand for the next 25 years — believes that the demand for energy is going to continue to grow at a rate of 1.1 per cent through 2040. Read the rest of this entry »

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8th April 2015

Global supply glut threatens British Columbia’s LNG projects – by Brent Jang (Globe and Mail – April 8, 2015)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Most liquefied natural gas export projects are at risk of being cancelled in North America as a result of a looming global glut of LNG, putting a damper on British Columbia’s energy dreams.

Moody’s Investors Service Inc. issued a stark outlook for the fledgling North American LNG industry, arguing it doesn’t make economic sense to invest billions of dollars on each venture especially as Asian buyers slow down their LNG orders for new LNG supplies.

Moody’s said the “vast majority” of North American proposals face outright cancellation. “Many sponsors – including those in the U.S., Canada and Mozambique that have missed that window of opportunity as oil prices have declined – will face a harder time inking the final contracts, most likely resulting in a delay or a cancellation of their projects.”,” the credit rating agency said.

There are 19 B.C. LNG projects vying to export to Asia. They include 10 export licences that have been approved by the National Energy Board

In the global LNG industry, most contracts have maintained their historic link to crude oil prices, and that has meant declining revenue for LNG suppliers amid the slump in oil markets. Read the rest of this entry »

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1st April 2015

NEWS RELEASE: Minister Rickford: Canada’s Plan for Responsible Resource Development Supports British Columbia’s Energy and Mineral Potential

VANCOUVER, March 31, 2015 /CNW/ – The Honourable Greg Rickford, Canada’s Minister of Natural Resources, today delivered keynote remarks hosted by the Vancouver Board of Trade, where he highlighted how Canada’s plan for Responsible Resource Development is supporting jobs, protecting the environment and enhancing First Nations engagement.

Minister Rickford reinforced Prime Minister Stephen Harper’s recent announcement accelerating the capital cost allowance on equipment used for liquefied natural gas (LNG) development from eight percent to 30 percent. Our government is supporting the Province of British Columbia’s efforts to advance LNG development, thereby creating Canadian jobs and generating revenue to support critical social programs.

The Minister also highlighted the Harper Government’s recent decision extending the Mineral Exploration Tax Credit. During a challenging global economy, this incentive helps keep investment in the mining industry flowing. Since 2006, it has assisted junior mining companies in raising over $5.5 billion.

Minister Rickford also emphasized the Harper Government’s announcement earlier this month expanding the definition of Canadian Exploration Expenses for tax purposes to include costs of environmental studies and community consultations that are required to obtain a permit for grassroots exploration. Companies can deduct these costs, making it easier for them to raise capital, create jobs and contribute to the economy. Read the rest of this entry »

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31st March 2015

Putting oil revenues into a savings fund isn’t always a great idea – by Stephen Gordon (National Post – March 31, 2015)

The National Post is Canada’s second largest national paper.

Pundits outside Alberta are almost unanimous in their support for a Norway-style sovereign wealth fund. If only the Alberta government had saved more of its resource revenues, the argument goes, then the Alberta government would have saved more of its resource revenues. Or something like that; details are never the strong suit of big-picture pundits. It’s usually enough to make the clearly unarguable point that it would nice to have an extra $1 trillion on hand, just like the Norwegians.

The Alberta government could have set aside some of its revenues into a wealth fund. But then again, so could have the federal government and any of the other provincial governments; Quebec already has put away $7 billion into its Generations Fund. The mechanics are pretty simple: set expenditures less than revenues and put the savings into a wealth fund. Any government can do it, so why don’t they? The answer is of course that saving is costly, and the benefits of being able to finance future spending don’t always exceed the costs of sacrificing current expenditure.

There are two things you can do when your income goes up: You can spend the increase, or you can save it (or some combination of the two). The theory of optimal savings says that the decision depends on whether or not the increase is temporary or permanent. A purely temporary jump in earnings — a good example is winning the lottery — should be saved, so that the benefits can be spread out across a long period of time. Read the rest of this entry »

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27th March 2015

Petrobras Nominates Vale CEO as Its Next Chairman – by Will Connors and Luciana Magalhaes (Wall Street Journal – March 27, 2015)

http://www.wsj.com/

Brazilian state-run oil company is in the midst of a widespread corruption scandal

RIO DE JANEIRO—Brazil’s government on Friday nominated the chief executive of mining giant Vale SA as the next board chairman of state-run oil firm Petroleo Brasileiro SA, disappointing those who were looking for sweeping changes at the oil company that has been devastated by a kickback-and-bribery scandal.

Murilo Ferreira’s nomination will be voted on at the next Petrobras shareholders meeting on April 29. If approved, as expected, he will succeed Guido Mantega, Brazil’s former finance minister, who has headed the Petrobras board since March 2010. The company on Thursday said that Luciano Coutinho, head of the country’s development bank, known as BNDES, will serve as interim chairman of Petrobras until next month’s board vote.

A career employee of Vale, which was state-owned until 1997, Mr. Ferreira is a trusted ally of President Dilma Rousseff. His appointment isn’t likely to shake up a board that has served as a rubber stamp for the policies of her ruling Worker’s Party, investors and analysts said.

Critics have faulted Ms. Rousseff for using the oil giant to advance her administration’s agenda, including forcing the company to subsidize fuel for consumers and do business with Brazilian suppliers, moves that have cost the oil giant billions. Read the rest of this entry »

posted in International Media Resource Articles, Iron Ore, Latin America Mining, Oil and Gas Sector-Politics and Image, Vale | Comments Off

18th March 2015

New rail-car standards coming too slow, agency says – by Kim Mackrael (Globe and Mail – March 18, 2015)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

OTTAWA — Canada’s transportation watchdog is questioning a federal proposal to phase in tougher tank-car standards over the next 10 years, saying a recent spate of fiery derailments is evidence that faster action will be needed.

The Transportation Safety Board made the comments in a progress report on its investigation into a crude-oil train accident earlier this month in Northern Ontario. The TSB is investigating the derailment of a Canadian National train near Gogama, Ont., on March 7, which spilled crude oil into a nearby river and sparked a massive fire that burned for more than three days.

While investigators did not come to a conclusion on what caused the accident, they said they found a section of broken rail that had been installed two days before the accident. The rail was sent to a laboratory in Ottawa for further analysis, the report said.

All of the tank cars involved in the accident were built after 2011 and complied with the current CPC-1232 standard, the TSB report said. That means they had steel cladding at the front and protection over the valves – added safeguards that were not present on the earlier-model tank cars involved in the Lac-Mégantic disaster two years ago. Read the rest of this entry »

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18th March 2015

Pacific Future Energy proposes B.C. refinery for Alberta bitumen – by Brent Jang (Globe and Mail – March 18, 2015)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

VANCOUVER — The backers of a bitumen refinery project in northwestern British Columbia believe their made-in-B.C. recipe for getting oil out of landlocked Alberta will win over skeptics.

Other high-profile energy projects – such as Enbridge Inc.’s Northern Gateway pipeline – remain stalled amid widespread opposition in B.C., but officials at Pacific Future Energy say their solution is to build a refinery to address fears about tankers spilling oil into the Pacific Ocean.

While the Northern Gateway proposal calls for loading unrefined heavy oil into tankers for export from Kitimat, Pacific Future Energy is seeking to build an $11.4-billion (U.S.) refinery near Prince Rupert that would turn Alberta bitumen into products such as gasoline and diesel.

Stockwell Day, the former federal international trade minister who is now Pacific Future Energy’s senior adviser, argues that Enbridge isn’t able to win a social licence for Northern Gateway because the pipeline proposal is tainted by the risk of oil spills from Asia-bound tankers.

Pacific Future Energy is casting Enbridge as an Alberta-centric company that has underestimated British Columbians’ opposition to oil tankers. Read the rest of this entry »

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18th March 2015

Talisman Energy Inc, Nexen Energy ULC fire hundreds of employees in ‘bloody Tuesday’ – by Claudia Cattaneo and Geoffrey Morgan (National Post – March 18, 2015)

The National Post is Canada’s second largest national paper.

CALGARY – St. Patrick’s Day turned into “bloody Tuesday” in Calgary as major companies Talisman Energy Inc. and Nexen Energy ULC — both recently acquired by foreign operators — axed hundreds of employees, adding to the surge of energy sector jobs cut as a result of low oil prices.

Talisman, the international oil and gas producer that has been purchased by Spain’s Repsol SA, said 10% to 15% of its employees and contractors would be laid off this week, or about 150 to 200 of 1,300 Calgary head-office jobs that support its global operations.

“It’s a tough week, it’s a tough time for the industry, and the reality is that no oil and gas company is immune to low commodity prices,” said Brent Anderson, spokesman for Talisman.

Nexen, a subsidiary of China’s CNOOC Ltd., also announced 400 job cuts – 300 of them in Calgary. The job losses represent 14.5% of the company’s total Canadian head count.

“A decision was made to conduct a thorough review of our organization to ensure our long-term viability and sustainability,” CEO Fang Zhi said in a statement. “While regrettable, these organizational changes are necessary to align the company with our reduced capital spending program. We take these decisions seriously, and all impacted employees have been treated fairly and with respect.” Read the rest of this entry »

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