Premier Notley tours Fort Hills and Long Lake, calling on Trudeau to get TMEP restarted
Premier Rachel Notley and her entourage visited the oil sands this week, showcasing two recent major investments in the sector, all the while trying to sidestep the big white elephant in the room.
FIRST STOP - FORT HILLS
The premier's first stop was Suncor's ribbon-cutting ceremony for Fort Hills, the latest brownfield oil sands mine to be build north of Fort McMurray.
At peak construction, almost 8,000 workers were employed, with 1,400 new full-time staff added to Suncor's payroll. Over the life of the mine, the provincial government expects to collect $8 billion in royalties.
When asked about the recent work stoppage at the Trans Mountain Expansion project (TMEP), the premier says she remains frustrated and angry, once again calling on the federal government to get a "clear and reliable path forward" to get construction restarted "not in months, but in weeks." The premier says her province has no intention of launching an appeal to the Supreme Court, but would apply for intervenor status if the appeal goes forward.
Federal Natural Resources Minister Amarjeet Sohi also attended the event, telling reporters his government is still considering an appeal and/or new legislation to get construction restarted, but hasn't made any decisions yet.
A QUESTION OF BUSINESS CONFIDENCE
Speaking at the Barclay's Energy-Power Conference in New York City last week, Suncor CEO Steve Williams told investors he's in no hurry to green-light any more oil sands expansions until a new pipeline gets built. Enbridge's Line 3 replacement will add 370,000 bbl/day of additional export capacity by the end of next year, but TransCanada's Keystone XL project remains embroiled in a tangled web of lawsuits south of the border, with no clear path forward or timeline in sight.
Williams points out that the cancelation of TMEP and a constantly-evolving regulatory process raises the bigger issue of business confidence in Canada's energy sector, posing a "big risk" to attracting investment dollars.
The 194,000 bbl/day Fort Hills Mine is a joint-venture with Teck Resources and French energy major Total. The CEO says the new mine should meet or exceed nameplate capacity by the fourth quarter of this year.
LOWERING GHG INTENSITY AT LONG LAKE
Premier Notley also attended an event highlighting Nexen's $400 million Long Lake South West project, still in the engineering and procurement phase. The 26,000 bbl/day steam-assisted gravity drainage (SAGD) greenfield expansion is expected to come online in 2020, lowering the GHG intensity per barrel of the entire facility. The company estimates the expansion will generate $200 million in royalties and property taxes over the life of the project, with 90% of the capital costs to be spent in the province of Alberta. Nexen is a wholly-owned subsidiary of CNOOC.