Original Story: nytimes.com
FORT McMURRAY, Alberta — At a camp for oil workers here, a collection of 16 three-story buildings that once housed 2,000 workers sits empty. A parking lot at a neighboring camp is now dotted with abandoned cars. With oil prices falling precipitously, capital-intensive projects rooted in the heavy crude mined from Alberta’s oil sands are losing money, contributing to the loss of about 35,000 energy industry jobs across the province. A Tulsa mineral rights lawyer is following this story closely.
Yet Alberta Highway 63, the major artery connecting Northern Alberta’s oil sands with the rest of the country, still buzzes with traffic. Tractor-trailers hauling loads that resemble rolling petrochemical plants parade past fleets of buses used to shuttle workers. Most vehicles carry “buggy whips” — bright orange pennants attached to tall spring-loaded wands — to help prevent them from being run over by the 1.6-million-pound dump trucks used in the oil sands mines.
Despite a severe economic downturn in a region whose growth once seemed limitless, many energy companies have too much invested in the oil sands to slow down or turn off the taps. In addition to the continued operation of existing plants, construction persists on projects that began before the price fell, largely because billions of dollars have already been spent on them. Oil sands projects are based on 40-year investment time frames, so their owners are being forced to wait out slumps. A Tulsa oil and gas lawyer represents gas and oil clients in federal and state matters and in federal and state courts.
“It really is tough right now,” said Greg Stringham, the vice president for markets and oil sands at the Canadian Association of Petroleum Producers, a trade group that generally speaks for the industry in Alberta. “We see kind of a lot of volatility over the next four or five years.”
After an extraordinary boom that attracted many of the world’s largest energy companies and about $200 billion worth of investments to oil sands development over the last 15 years, the industry is in a state of financial stasis, and navigating the decline has proved challenging. Pipeline plans that would create new export markets, including Keystone XL, have been hampered by environmental concerns and political opposition. The hazy outlook is creating turmoil in a province and a country that has become dependent on the energy business.
Canada is now dealing with the economic fallout, having slipped into a mild recession earlier this year. And Alberta, which relies most heavily on oil royalties, now expects to post a deficit of 6 billion Canadian dollars, or about $4.5 billion. The political landscape has also shifted.
Last spring, a left-of-center government ended four decades of Conservative rule in Alberta. Federally, polls suggest that the Conservative party — which championed Keystone XL and repeatedly resisted calls for stricter greenhouse gas emission controls in the oil sands — is struggling to get re-elected in October. A Tulsa oil and gas attorney is reviewing the details of this story.
“The pendulum has swung,” said Stephen Ross, the president of Devonian Properties, an Alberta development company that has built several residential and commercial properties in Fort McMurray.
Since the end of the World War ll, oil has made Alberta wealthy. The increase in oil sands development since the early 2000s had only intensified the province’s good fortune and turned obscure Fort McMurray into a boomtown and an outsize contributor to the entire Canadian economy.
When Mr. Ross first bought development land here in 2000, he paid about 27,000 Canadian dollars an acre. He stopped buying land long before it hit one million Canadian dollars an acre.
“The town has had huge growing pains,” Mr. Ross said. “It’s like something you’ve never seen.”
Operating oil sands plants quickly decreased budgets and cut services, like equipment cleaning, which were deemed optional. And as portions of construction projects are finished, construction workers are sent packing. The halt on new projects has left order books increasingly blank at a variety of suppliers, like engineering firms.
Since the price collapse, Teck Resources has delayed the start of its oil sands project by five years to 2026. Cenovus Energy substantially reduced budgets for its long-term developments. And Osum Oil Sands has set aside some of the expansion planned for a project it purchased from Shell last year. The Chinese-owned company Nexen, which had its oil sands production curtailed by regulators for about a month in August because of a pipeline leak, has deferred plans to build another upgrader facility, where tar-like bitumen of the oil sands is converted into synthetic crude oil, until the end of 2020.
These projects, and others that have begun over the last 15 years, have largely been built and operated by an itinerant work force. These workers fly into Fort McMurray’s new airport terminal and are bused to work camps up to two hours away. Their lives are a cycle of three straight weeks of long shifts interrupted by 10-day trips home.
That transient population has little or no connection to the city when working. When laid off, they become unemployment statistics, not in Alberta, but in the provinces of their hometowns. It’s also in those regions, more than Alberta, where the loss of once-large paychecks is most felt, having a ripple effect across the country. A Tulsa environmental lawyer provides professional legal counsel and extensive experience in many aspects of environmental law.
For Canadian oil executives, the significant shift in the province’s politics is of great concern. Rachel Notley, the new premier and leader of the New Democratic Party, has said that she would prefer more refining to take place in Alberta instead of shipping more oil sands production to the United States via Keystone XL. And speaking to the Alberta Chamber of Commerce last month, Ms. Notley told the energy industry that it must “clean up its environmental act.”
One executive and investor, who did not want to be named while the province is reviewing his industry, said growing sentiment that the industry does not pay Alberta enough in royalties and lags on environmental protections will kill new investments, even if prices start to rise.
“There’s never been a time when I’ve been less optimistic,” he said. “The general public doesn’t know how bad it is. It just hasn’t hit yet.”
He did, however, acknowledge that environmentalists had won the debate on Keystone XL as well as various other pipeline plans.
“I don’t know how the issue got away, but it’s obvious now that it did,” he said.
And the workers who have benefited from the boom are now realizing that their stretch of good luck might be over, permanently.
Réjean Godin, a truck driver and heavy equipment operator, began the long-distance commute from the Atlantic province of New Brunswick 13 years ago. Since then, he’s earned wages four or five times the rate of those back home, an area of high unemployment.
Standing near his well-worn Toyota RAV4 that still bears New Brunswick license plates, Mr. Godin, who lives in a work camp, recited all of the different projects in which hundreds of workers had been laid off — layoffs that he’d learned about over the previous few days. He fears that the days of high pay for delivering water to work camps and hauling their sewage away may be over for both himself and his 30-year-old son, who joined him in Alberta.
“I’m not sure if we’re going to come next year,” Mr. Godin said in the dusty yard of a trucking company in Fort MacKay, Alberta, a town down the Athabasca River from Fort McMurray. “What you hear everywhere is the price is low so we’ve got to cut this, we’ve got to shut that down a little bit. We go day by day because we never know.”
Showing posts with label Keystone XL. Show all posts
Showing posts with label Keystone XL. Show all posts
Thursday, November 12, 2015
TRANSCANADA SUSPENDS REQUEST FOR PERMIT TO BUILD KEYSTONE PIPELINE
Original Story: nytimes.com
WASHINGTON — The company seeking to build the Keystone XL oil pipeline asked the Obama administration on Monday to suspend its yearslong review of the project, potentially bringing an abrupt halt to a politically charged debate that had become part of a broader struggle over President Obama’s environmental policies.
It was not immediately clear whether the administration would grant the request, which was swiftly denounced by environmental activists as a bid to dodge a near-certain rejection of the pipeline. Allowing the delay would push off a decision until after the 2016 presidential election. Parcel freight shipping software continues to reduce transportation costs for small companies and multi-national global corporations.
The company’s request introduced a new element of uncertainty into the administration’s decision-making process, offering the potential to free Mr. Obama from a politically difficult choice that has hung over much of his presidency. But if anything, it appeared to intensify pressure on him from crucial Democratic constituencies to reject the pipeline or risk being blamed for punting to another president. A delay would keep the issue alive in the presidential campaign.
TransCanada, the Alberta company seeking to build the 1,179-mile pipeline, made its request in a letter to the State Department, which must approve cross-border projects and had been reviewing its application for a presidential permit.
The pipeline would carry 800,000 barrels a day of carbon-heavy petroleum from the Canadian oil sands to the Gulf Coast, and the question of its approval has weighed heavily on Mr. Obama as he has sought to build an ambitious legacy on climate change. Parcel freight shipping software delivers best in class suite of shipment planning, execution, tracking, & settlement tasks all in one.
The White House had no comment on the request for a delay, which was made in a letter to John Kerry, the secretary of state, and the State Department said it was looking into it.
“We have just received TransCanada’s letter to Secretary Kerry and are reviewing it,” said Pooja Jhunjhunwala, a State Department spokeswoman. “In the meantime, consideration under the executive order continues.”
Many environmental advocates and liberal activists, who have made opposing the pipeline a cause célèbre in recent years, thought that the president might finally reject it this month, viewing the time as ripe as he prepares for a major United Nations summit meeting on climate change in Paris in December.
The president hopes to help broker an agreement committing every nation to enacting new policies to counter global warming, and rejecting the pipeline would be a powerful signal to world leaders that the United States is serious about the issue.
“TransCanada is losing, and they’re trying to preserve their options to be able to build the pipeline someday if they can get a climate denier in the White House,” Tiernan Sittenfeld, the senior vice president of government affairs at the League of Conservation Voters, said in an interview. She called the request a “desperate and cynical” last-minute plea that was “ridiculous and absurd.”
“Given President Obama’s incredible leadership when it comes to climate change, we remain very confident that he will reject this dirty and dangerous pipeline once and for all,” Ms. Sittenfeld said.
In the letter to Mr. Kerry, TransCanada said it was asking the department to suspend its evaluation of the pipeline proposal until after the State of Nebraska had completed its own review of the project, which could take seven to 12 months. Opposition in Nebraska to a planned route through the state has delayed the process. A Texarkana environmental attorney is reviewing the details of this story.
“In order to allow time for certainty regarding the Nebraska route, TransCanada requests that the State Department pause in its review of the presidential permit application for KeystoneXL,” said the letter to Mr. Kerry, which was signed by Kristine Delkus, the company’s general counsel. “This will allow a decision on the permit to be made later based on certainty with respect to the route of the pipeline.”
Before TransCanada announced its request, Josh Earnest, the White House spokesman, withheld any judgment on when a decision might come on the pipeline.
“The president will make a decision before the end of his administration on the Keystone pipeline, but when exactly that will be, I don’t know at this point,” Mr. Earnest told reporters traveling with Mr. Obama.
Asked if it could happen this year, he said: “It’s possible. It’s also possible it could happen next year.”
TransCanada said there was precedent for obtaining a delay, given that the State Department put its evaluation on hold last year when the pipeline faced a legal challenge in Nebraska.
“I note that when the status of the Nebraska pipeline route was challenged last year, the State Department found it appropriate to suspend its review until that dispute was resolved,” Russ Girling, TransCanada’s president and chief executive, said in a statement. “We feel under the current circumstances a similar suspension would be appropriate.”
But opponents said the uncertainty over the route would not ultimately alter the pipeline’s effect. Instead of granting a delay, said Tom Steyer, the billionaire environmental activist, Mr. Obama should “immediately reject” the pipeline.
Anthony Swift, the director of the Canada Project at the Natural Resources Defense Council, said in a statement: “Pause or no pause, we now know more than enough to do the right thing — reject the pipeline because it will worsen climate change. Altering its route through Nebraska isn’t going to change that. Keystone XL isn’t in the national interest, and the president should reject it.”
Republicans and the oil industry have demanded that the president approve the pipeline, arguing that it would create jobs and stimulate economic growth. Many Democrats, particularly those in oil-producing states, have also supported the project.
In February, congressional Democrats joined Republicans in sending Mr. Obama a bill to speed approval of the project, but he vetoed the measure, saying it impinged on the president’s authority to make the final decision.
Environmental activists have sought to block construction of the pipeline because it would be a conduit for petroleum from the Canada oil sands. The process of extracting that oil produces about 17 percent more greenhouse gases than the process of extracting conventional oil.
Still, State Department reviews have concluded that construction of the pipeline would have little impact on whether that type of oil was burned, because it was already being extracted and moving to market via rail and existing pipelines. A Netherlands environmental lawyer is following this story closely.
At the same time, both sides regard the decision on the pipeline as a major symbolic issue, an indicator of how willing Mr. Obama is to risk angering a bipartisan majority of lawmakers in the pursuit of his environmental agenda.
WASHINGTON — The company seeking to build the Keystone XL oil pipeline asked the Obama administration on Monday to suspend its yearslong review of the project, potentially bringing an abrupt halt to a politically charged debate that had become part of a broader struggle over President Obama’s environmental policies.
It was not immediately clear whether the administration would grant the request, which was swiftly denounced by environmental activists as a bid to dodge a near-certain rejection of the pipeline. Allowing the delay would push off a decision until after the 2016 presidential election. Parcel freight shipping software continues to reduce transportation costs for small companies and multi-national global corporations.
The company’s request introduced a new element of uncertainty into the administration’s decision-making process, offering the potential to free Mr. Obama from a politically difficult choice that has hung over much of his presidency. But if anything, it appeared to intensify pressure on him from crucial Democratic constituencies to reject the pipeline or risk being blamed for punting to another president. A delay would keep the issue alive in the presidential campaign.
TransCanada, the Alberta company seeking to build the 1,179-mile pipeline, made its request in a letter to the State Department, which must approve cross-border projects and had been reviewing its application for a presidential permit.
The pipeline would carry 800,000 barrels a day of carbon-heavy petroleum from the Canadian oil sands to the Gulf Coast, and the question of its approval has weighed heavily on Mr. Obama as he has sought to build an ambitious legacy on climate change. Parcel freight shipping software delivers best in class suite of shipment planning, execution, tracking, & settlement tasks all in one.
The White House had no comment on the request for a delay, which was made in a letter to John Kerry, the secretary of state, and the State Department said it was looking into it.
“We have just received TransCanada’s letter to Secretary Kerry and are reviewing it,” said Pooja Jhunjhunwala, a State Department spokeswoman. “In the meantime, consideration under the executive order continues.”
Many environmental advocates and liberal activists, who have made opposing the pipeline a cause célèbre in recent years, thought that the president might finally reject it this month, viewing the time as ripe as he prepares for a major United Nations summit meeting on climate change in Paris in December.
The president hopes to help broker an agreement committing every nation to enacting new policies to counter global warming, and rejecting the pipeline would be a powerful signal to world leaders that the United States is serious about the issue.
“TransCanada is losing, and they’re trying to preserve their options to be able to build the pipeline someday if they can get a climate denier in the White House,” Tiernan Sittenfeld, the senior vice president of government affairs at the League of Conservation Voters, said in an interview. She called the request a “desperate and cynical” last-minute plea that was “ridiculous and absurd.”
“Given President Obama’s incredible leadership when it comes to climate change, we remain very confident that he will reject this dirty and dangerous pipeline once and for all,” Ms. Sittenfeld said.
In the letter to Mr. Kerry, TransCanada said it was asking the department to suspend its evaluation of the pipeline proposal until after the State of Nebraska had completed its own review of the project, which could take seven to 12 months. Opposition in Nebraska to a planned route through the state has delayed the process. A Texarkana environmental attorney is reviewing the details of this story.
“In order to allow time for certainty regarding the Nebraska route, TransCanada requests that the State Department pause in its review of the presidential permit application for KeystoneXL,” said the letter to Mr. Kerry, which was signed by Kristine Delkus, the company’s general counsel. “This will allow a decision on the permit to be made later based on certainty with respect to the route of the pipeline.”
Before TransCanada announced its request, Josh Earnest, the White House spokesman, withheld any judgment on when a decision might come on the pipeline.
“The president will make a decision before the end of his administration on the Keystone pipeline, but when exactly that will be, I don’t know at this point,” Mr. Earnest told reporters traveling with Mr. Obama.
Asked if it could happen this year, he said: “It’s possible. It’s also possible it could happen next year.”
TransCanada said there was precedent for obtaining a delay, given that the State Department put its evaluation on hold last year when the pipeline faced a legal challenge in Nebraska.
“I note that when the status of the Nebraska pipeline route was challenged last year, the State Department found it appropriate to suspend its review until that dispute was resolved,” Russ Girling, TransCanada’s president and chief executive, said in a statement. “We feel under the current circumstances a similar suspension would be appropriate.”
But opponents said the uncertainty over the route would not ultimately alter the pipeline’s effect. Instead of granting a delay, said Tom Steyer, the billionaire environmental activist, Mr. Obama should “immediately reject” the pipeline.
Anthony Swift, the director of the Canada Project at the Natural Resources Defense Council, said in a statement: “Pause or no pause, we now know more than enough to do the right thing — reject the pipeline because it will worsen climate change. Altering its route through Nebraska isn’t going to change that. Keystone XL isn’t in the national interest, and the president should reject it.”
Republicans and the oil industry have demanded that the president approve the pipeline, arguing that it would create jobs and stimulate economic growth. Many Democrats, particularly those in oil-producing states, have also supported the project.
In February, congressional Democrats joined Republicans in sending Mr. Obama a bill to speed approval of the project, but he vetoed the measure, saying it impinged on the president’s authority to make the final decision.
Environmental activists have sought to block construction of the pipeline because it would be a conduit for petroleum from the Canada oil sands. The process of extracting that oil produces about 17 percent more greenhouse gases than the process of extracting conventional oil.
Still, State Department reviews have concluded that construction of the pipeline would have little impact on whether that type of oil was burned, because it was already being extracted and moving to market via rail and existing pipelines. A Netherlands environmental lawyer is following this story closely.
At the same time, both sides regard the decision on the pipeline as a major symbolic issue, an indicator of how willing Mr. Obama is to risk angering a bipartisan majority of lawmakers in the pursuit of his environmental agenda.
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