Category: Drill, Baby, Drill

Good Fracking Luck

It seems that the environmentalist movement has come to the conclusion that there is good fracking and bad fracking. Bad fracking is when we drill a well and extract hydrocarbons. Good fracking is when we expend huge sums to stuff a perfectly harmless gas back down those same holes. It’s a variation on Keynesian economics: wherever we find existing holes, we should pay people to fill them in, even if there is no need to do so. The article goes on to point out all sorts of potential problems with this idea, but then Keynesians will likely argue that remediation efforts will “stimulate” the economy.

With support from the Biden administration and billions of dollars in new subsidies and tax incentives, energy companies and others are planning to capture millions of tons of industrial carbon dioxide emissions and then pipe the climate pollutant for underground storage, part of an effort to reduce the nation’s greenhouse gas pollution. Federal and state regulators are reviewing 69 projects or permits to store CO2 underground, with 24 of those in Louisiana. Nine projects have already been approved while one more, in California, is pending.

For the first time in about two decades, Saskatchewan changes its oil royalties scheme

Are multi-laterals the next big thing in oil? Saskatchewan bets heavy on it with new incentive program. This is the largest change in oil royalties in decades, as the government hopes to incentivize activity and production. It’s a big shift for a government that for its entire 16 years in office said it wasn’t touching a thing when it comes to royalties.

Let me put this into perspective – for the several years Bill Boyd was energy minister, he always gave the same speech, which basically went like this: “The premier has told me to say thank you. Thank you for the jobs, thank you for the taxes, thank you for the royalties and investment. And we’re not touching a thing when it comes to royalties.”

Usually whenever someone mentions royalty changes, it’s with the intention of raising them. This is the opposite, providing a royalty incentive – NOT a holiday – to get more activity and production going.

 

“The same architects of our insane energy policy… are also the architects of our military strategy.”

I believe I’ve mentioned this.

The team riffs with Doomberg, a renowned energy analyst, to discuss a range of issues from the global energy landscape to geopolitical tensions and the changing nature of warfare. The conversation also delves into the intricacies of the global natural gas market, the impact of sanctions on Russia, and the potential future of nuclear energy.

Doomberg is a good, though pricey Substack to subscribe to. I wish more of his material was open to free viewing.

Will a First Nation-owned pipeline be without protests and opposition?

Can’t imagine why oil shippers demand explanation from Trans Mountain for pipeline cost overruns, can you?

B.C. First Nation and Western LNG partner to purchase natural gas pipeline project. Can they succeed in bringing a major pipeline in on time and on budget, or will they face the same perils as Trans Mountain (above) and Coastal GasLink? Will other First Nations do all they can to halt it, like GasLink? Will they destroy equipment and raid camps?

US Bureau of Land Management accepts bids for the sale of Federal Helium System. FYI the US Govt getting out of #helium is what’s driving Saskatchewan’s burgeoning industry

Hey, about that pipeline?

Brian Zinchuk: If Poilievre wins a massive majority, can we PLEASE build the Energy East Pipeline?

(I’m fairly certain Premier Moe is tired about me asking about this. I was still talking about it two years ago, which was four years after it was supposed to have been completed. But it’s worth a shot.)

 

UPDATE: It appears Premier Scott Moe agrees:

 

About those multi-lateral wells … and the Alberta grid

Photo by Brian Zinchuk

Saturn Oil & Gas has joined the multi-lateral bandwagon, having drilled two open hole multi-lateral wells that the Government of Saskatchewan announced an incentive for yesterday (shared yesterday)

I’ve been saying for over a year the Government of Saskatchewan needs to do something to increase drilling numbers. I’m wondering if this is it?

Also: Alberta’s shaking up its electrical grid by 2027. And in a related story, new rules for power generators in Alberta

Drill, baby, drill. New drilling incentive in Saskatchewan

On Monday, Saskatchewan announced a new comprehensive program to attract investment to the province. One of the items is a new program to incentive multi-lateral wells. That’s a well that looks like a herringbone or spiderweb, with lots of legs and increased production.

The question I will be asking soon is if companies are already doing this, why do we need an incentive? Are we leaving money on the table, or is there an expectation of a lot more returns?

Pipeline chicken or the egg?

Pipeline capacity gets restrained, slowing growth in oil production. Pipelines get built (Enbridge Line 3 replacement, Trans Mountain Expansion, eventually) allowing for oil production to grow. Oil production will soon grow to use up all that extra capacity, and production growth will be restrained, again.

So then what? I’m not aware of ANY major new export pipelines projects being considered. After Northern Gateway, Keystone XL and Energy East being canned, who would? And after the federal government proved you could go 6x, maybe closer to 7x over budget building a pipeline they way they want it built, what idiot will try again?

The alternative will have to be crude-by-rail. Oh, lovely.

(That pipeline photos is of a tiny gathering pipeline near Estevan, not a mammoth transmission line.)

 

As for another fan (NOT) of crude by rail, Quick Dick McDick hauled canola recently. And sang about it. Seriously.

Reject Net Zero by 2050, says Sask United

Nadine Wilson. Legislative Assembly of Saskatchewan

 

Several commenters on SDA frequently point out if you accept the premise of your opponent’s argument, you’ve already lost. Looks like that’s what the Saskatchewan United Party is saying here.

Saskatchewan United Party calls on Sask Party government to reject Net Zero by 2050 policy. Leader Nadine Wilson says the Sask Party government seeks to shut down coal and natural gas for wind and solar, gets punted from assembly for calling government liars.

NDP calls for break on fuel tax, finance minister says it would be temporary

Wind peters out in Alberta, yet again, on Wednesday

Op-Ed: Kaase Gbakon: A (Hungry?) Tiger in Your Tank: Part 2

 

A plan to save coal, power generation, and the oil industry in SE Sask

Boundary Dam Power Station

What if there was a way to keep coal mining jobs in Saskatchewan, continue to produce low-cost electrical power, and extend the production of a substantial portion of Saskatchewan’s oilfields not by decades, but by generations? And in doing so, we could still dramatically reduce carbon dioxide emissions, and maybe save some money by reducing our nuclear rollout?

Recent developments from Whitecap Resources showing using CO2 in the Frobisher formation led to initial results of 5x improved production. Not 5%, or 50%, but 5x. That’s 500%. I’m not saying it’ll stay anywhere close to that, but we should be taking a very serious look at this development, especially since most new drilling in southeast Saskatchewan is focused on the Frobisher, part of the Mississippian. While the Bakken was a flash in the pan, the Mississippian has been the mainstay of SE Sask oil production for generations. And this is a generational opportunity, but we will let it slip through our fingers if we shut down our coal-fired power plants.

This is one of the most significant opinion pieces I’ve ever done with regards to energy. It basically puts it all together.

 

Y2Kyoto: State Of Anorexia Envirosa

Bloomberg;

Using crops to make diesel involves an inherent trade-off between the fuel’s climate-friendly benefits and preserving enough supplies to keep food prices in check.

Finding the balance can be tricky. That’s the challenge facing California as it debates a potential revamp of the Low Carbon Fuel Standard.

The frenzy to cash in on credits for lower emissions has triggered a surge in renewable diesel, with state supplies reaching records every quarter since 2020.

The escalation has led environmentalists to call for a limit on crop-based fuels, arguing it’s necessary to ensure the program doesn’t worsen hunger. The biofuel is often made from soybean oil, a staple for cooking.

“California is diverting soybean oil from food markets into its fuel market, and that’s surprising and troubling,” said Jeremy Martin, a senior scientist for the Union of Concerned Scientists who studies the impacts of fuel policy.

And there’s a weird domino effect of using soy oil to make renewable diesel, which some critics say blunts the climate benefits.

As more soy oil goes into diesel, demand climbs for palm oil, a controversial commodity. The European Union wants to phase out its use in fuel production to curb deforestation.

California’s regulatory board recently postponed a March 21 hearing on the fuel standard.

There is No Strong Business Case for Canadian LNG

Bloomberg;

Qatar is unwavering in its view that the world isn’t investing enough in natural gas. And the tiny Middle Eastern nation is trying to fix that.

State-owned QatarEnergy said Sunday it will develop a 16 million-ton-a-year LNG export project by the end of the decade. That’s on top of its previously announced record-breaking expansion plans.

Altogether, the Gulf state will boost shipments of liquefied natural gas by more than 80% by 2030.

The move illustrates the nation’s conviction that demand for gas, especially in Asia, will continue rising even as the world shifts to renewables. That’s at odds with organizations such as the International Energy Agency, which sees global consumption peaking this decade.

Should Saskatchewan again have a sovereign wealth fund?

With Alberta going all-in on its sovereign wealth fund (posted yesterday), should Saskatchewan take another look at one of its own? We had one, but it didn’t last long, and turned into something of a slush fund for Crown corporations, apparently. I dug up this discussion paper that was written by U of R professor Stuart Wilson which is actually pretty good. I republished the entire paper, with his permission, on Pipeline Online.

Perhaps ironically, Norway’s massive sovereign wealth fund was originally modelled on Alberta’s. And that fund is now worth US$1.42 trillion dollars (with a “t”). (Norway has less oil than Alberta).

Y2Kyoto: Schadenfrozen

Schnell! Schnell! Zey must build more wind farms!

Amid the flickering of flares and torches, many of the 1,600 people losing their jobs stood stone-faced as the glowing metal of the plant’s last product — a steel pipe — was smoothed to a perfect cylinder on a rolling mill. The ceremony ended a 124-year run that began in the heyday of German industrialization and weathered two world wars, but couldn’t survive the aftermath of the energy crisis. […]

The underpinnings of Germany’s industrial machine have fallen like dominoes. The US is drifting away from Europe and is seeking to compete with its transatlantic allies for climate investment. China is becoming a bigger rival and is no longer an insatiable buyer of German goods. The final blow for some heavy manufacturers was the end of huge volumes of cheap Russian natural gas.

Enjoy the decline.

Navigation