• 4 minutes Phase One trade deal, for China it is all about technology war
  • 7 minutes IRAN / USA
  • 11 minutes Shale Oil Fiasco
  • 16 minutes Swedes Think Climate Policy Worst Waste of Taxpayers' Money in 2019
  • 2 hours Indonesia Stands Up to China. Will Japan Help?
  • 4 hours We're freezing! Isn't it great? The carbon tax must be working!
  • 6 hours Trump capitulated
  • 9 hours Three oil pipeline projects inch toward goal-line for Canada
  • 14 hours The Libyan Oil in a Sea of Chaos, War and Disruptions
  • 1 day Trump has changed into a World Leader
  • 5 hours Gravity is a scam!
  • 7 hours Yet another Petroteq debt for equity deal
  • 4 hours US Shale: Technology
  • 21 hours Prototype Haliade X 12MW turbine starts operating in Rotterdam
  • 17 hours OIL & GAS LOSSES! Schlumberger Posts $10B Loss in 2019
  • 1 day Beijing Must Face Reality That Taiwan is Independent
  • 1 hour Thanks to Trump, the Iranian Mullahs Are Going Bankrupt
  • 2 hours Which emissions are worse?: Cows vs. Keystone Pipeline
Russia Risks Gasoline Price Surge

Russia Risks Gasoline Price Surge

In 2019, the rise in…

A Worrying Sign For U.S. Shale

A Worrying Sign For U.S. Shale

After years of adding drilled…

Alberta Government To Stop Its Oil By Rail Program By Fall

Rail

The government of Alberta, Canada is looking to offload its massive oil-by-rail program in what the Alberta Energy Minister Sonya Savage described as “highly confidential” negotiations, according to a Thursday news release.

The news is just the latest in a series of dramatic political developments in Canada’s oil industry that has caused deep rifts between parties as the future of its oil business is reshaped one hard-fought battle at a time.

The NDP government had promised back in February lucrative outflows from getting its hands in the oil by rail business at a price tag of nearly $4 billion. The windfall was expected to be over $2 billion over three years.  Now the Energy Ministry is signing a different tune—the project is now supposed to generate a loss, rather than substantial income. A large loss of $1.5 billion.

Regardless of the merits of this information or the information presented in February, Alberta is now heading for the oil-by-rail exit, enlisting the help of CIBC Capital Markets to divest from this pricey endeavor by selling it off to the private sector. A deal is expected by fall.

“As a government we are accountable to the taxpayer,” Savage said on Thursday.

The oil by rail project taken on the government was supposed to help Alberta move its oil to customers as pipeline capacity is already maxed, interfering with getting its oil to market. In the meantime, Canada has reduced oil production on a non-voluntary basis to help prop up prices as the outflow capacity is simply not enough to keep oil inventories from growing unchecked.

The production cuts were successful in shoring up the discount to WTI, which had reached $45 per barrel at the time of the cuts in late 2018, to about $12 per barrel today. The government also announced today that it will again ease the restrictions come August—to 3.74 million barrels per day, according to the Calgary Herald.

By Julianne Geiger for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage


Leave a comment

Leave a comment

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