• 2 minutes Rational analysis of CV19 from Harvard Medical School
  • 4 minutes While U.S. Pipelines Are Under Siege, China Streamlines Its Oil and Gas Network
  • 7 minutes Renewables Overtake Coal, But Lag Far Behind Oil And Natural Gas
  • 12 hours Joe Biden the "Archie Bunker" of the left selects Kamala Harris for VP . . . . . . Does she help the campaign ?
  • 16 mins Tesla Begins Construction Of World’s Largest Energy Storage Facility
  • 19 hours Trump Hands Putin Major Geopolitical Victory
  • 4 hours America Could Go Fully Electric Right Now
  • 1 hour Will any journalist have the balls to ask Kamala if she supports Wall Street "Carried Interest" Tax Loophole
  • 13 hours Those Nasty White People and Camping Racism
  • 1 hour In 1,267 days, Trump has made 20,055 false or misleading claims
  • 8 hours COVID&life and Vicious Circle: "Working From Home Is Not Panacea For Virus"
  • 2 hours .
  • 47 mins Brent above $45. Holding breath for $50??
  • 3 hours Buying votes is cool now.
  • 14 hours The Truth about Chinese and Indian Engineering
  • 2 days China wields coronavirus to nationalize American-owned carmaker
  • 1 day Oil Tanker Runs Aground in Mauritius - Oil Spill
  • 2 days Open letter from Politico about US-russian relations
  • 2 hours The World is Facing a Solar Panel Waste Problem
Robert M Cutler

Robert M Cutler

More Info

Premium Content

Enbridge Continues Rise as Canada Seeks Own Energy Road

A recent report by Finance Canada says that the discount to international prices at which Canadian oil and gas exports are selling, is causing the country to lose $4 billion in revenue. The way to fix the problem is to build new pipelines and export terminals to access world markets. Prices for Canadian oil in the U.S. has long been $15-20 per barrel below world market price because Canada simply has no other buyer. This difference has in recent months increased to $30-$40 per barrel as the world market price outside North America has increased while the price from the U.S. has remained stagnant or even fallen due to an oversupply of crude at the gathering hub in eastern Oklahoma where the Canadian product flows.

Canada's Finance Minister Jim Flaherty has nevertheless rejected the idea of giving tax breaks on liquefied natural gas (LNG) export facilities that would be built on the coast of British Columbia in the west. Producers have wanted to be able to use accelerated writeoffs by having Ottawa treat them as last year to accelerate environmental reviews of such projects as the Northern Gateway pipeline that is proposed by the Canadian company Enbridge. This would in fact be a twin pipeline, one to receive natural gas condensate and one to send out bitumen from the Alberta oil sands. PetroChina signed an agreement in 2005 to buy 200,000 barrels per day, to be exported via tankers, but suspended the agreement in 2007 due to delays.

Related article: Have the Canadian Tar Sands had their Day?

Meanwhile, political momentum has been developing to increase west-to-east energy flows inside Canada. One idea has been to reverse the flow of the Interprovincial Pipeline (IPL), originally built to carry product from west to east back to its originally planned direction. Another, involving the conversion of a natural gas line to crude oil, could enter into service by 2017 subject to regulatory approval. (Enbridge began its corporate life in 1949 as the Interprovincial Pipe Line, Inc.) This is a no-brainer, as it would increase domestic refining, reduce the prices in eastern Canada now relying on imports from the world market, and eventually allow exports from eastern Canada to international destinations.

Enbridge opened Thursday on the TSX at C$46.55 (45.96 on Wall Street), on the march upwards from 17 since November 2008 but with a current P/E ratio approaching 60. It has been near the top of its Bollinger Band for almost a month but has been progressing so slowly and steadily that it retains good momentum and is still not overbought, while other medium-term technical indicators also remain favorable.

By. Robert M. Cutler for Oilprice.com


Download The Free Oilprice App Today

Back to homepage





Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News