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Will Canadian Oil Be For the Lamps of China?
Investor's Business Daily ^ | February 13, 2012 | IBD staff

Posted on 02/13/2012 2:49:23 PM PST by raptor22

Energy: While our president sleeps on the Keystone XL pipeline, Canada’s prime minister is in Beijing signing a series of trade deals to ship additional petroleum to China. Halftime in America? We need a new quarterback.

While Clint Eastwood, in that thinly disguised infomercial for President Obama's re-election campaign, was promising that the world would soon hear the roar of our engines, China's economy will soon be revving up with petroleum that should and could be flowing south in a pipeline the Obama administration won't build.

Prime Minister Steven Harper is making good on his warning that Canada would seek other customers for the vast oil riches locked in the oil sands of Alberta. He is leading a five-day delegation to an energy-hungry China eager to be Canada's best customer. He will not wait for an American administration fixated on windmills and Solyndras and automakers that produce overpriced electric cars prone to battery fires.

"I am very serious about selling our oil off this continent, selling our energy products off to Asia. I think we have to do that," Harper said in an interview with Canada's CTV National News in the wake of President Obama's decision to kick the Keystone oil can down the road past the November election.

On the trip Harper announced a series of multibillion-dollar trade and business agreements to ship additional Canadian petroleum, uranium and other products to China. More than 20 commercial agreements involving more than 50 Chinese and Canadian companies were announced. In addition, a joint economic study to be completed by May could form the basis for a free trade agreement.

(Excerpt) Read more at news.investors.com ...


TOPICS: Business/Economy; Canada; Editorial; Government
KEYWORDS: alberta; canada; energy; ibd; ibdenergy; keystonexl; oil; pipeline

1 posted on 02/13/2012 2:49:29 PM PST by raptor22
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To: Nachum; markomalley; Clairity; Carlucci; grey_whiskers; meyer; WL-law; Para-Ord.45; ...

Energy ping


2 posted on 02/13/2012 2:51:58 PM PST by raptor22 (Join me on Twitter @gerfingerpoken)
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To: raptor22

A President actively decreasing economic activity and increasing spending at the same time is a threat to this Country.


3 posted on 02/13/2012 2:59:50 PM PST by radioone
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To: radioone

If we can’t defeat this guy in November, we deserve him.


4 posted on 02/13/2012 3:04:58 PM PST by nascarnation (DEFEAT BARAQ 2012 DEPORT BARAQ 2013)
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To: nascarnation
If we can’t defeat this guy in November, we deserve him.

I agree and with a variation...

IF WE, THE PEOPLE OF THE UNITES STATES, CAN'T DEFEAT THIS GUY IN NOVEMBER, THEN WE DESERVE HIM.
5 posted on 02/13/2012 3:24:15 PM PST by Signalman
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To: raptor22

Maybe I’m showing my ignorance of how the oil industry works, but why don’t the Canadians just build a refinery in Canada and ship the gasoline instead of the oil?


6 posted on 02/13/2012 4:00:08 PM PST by Brilliant
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To: Brilliant
How do you want that gasoline to be shipped? By the bucket? We are talking about 800,000 barrels of oil (35 gallons in a barrel) a day. That's 28 million gallons a day. That's a lot of buckets, or tank cars, or tankers.

The only way to ship this resource, whether crude oil or the products derived from it, in volume, is by pipeline.

The pipeline is not the issue. Obama wants higher energy prices for America. His policy is designed to limit supply, thereby increasing prices. Wake up America, your president does not have your best interests at heart.

7 posted on 02/13/2012 5:09:40 PM PST by Former Proud Canadian (Obamanomics-We don't need your stinking tar sands oil, or the jobs that go with it.)
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To: Former Proud Canadian

It’s gotta be shipped from somewhere, though. Why can’t it be shipped from Winnipeg instead of Port Arthur?


8 posted on 02/13/2012 5:14:57 PM PST by Brilliant
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To: radioone
A President actively decreasing economic activity and increasing spending at the same time is a threat to this Country.

I may not like him, but as I've said before, Rick Perry went to China, and convinced the Chinese to invest over $2 billion into South Texas oilfields, creating 10s of thousands of jobs and putting dozens of oil wells into production for China's national offshore company while Obama did what?
9 posted on 02/13/2012 5:25:16 PM PST by af_vet_rr
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To: Brilliant
With respect, B. look at a map. PORT Arthur is a main oil terminus, a seaport, which means tankers can load up there. Also existing product pipelines stand ready to pump the products to east coast and midwest markets from Port Arthur.

Winnipeg? Winnipeg? There is a reason that Manitoba has NO OIL REFINERIES. Once again, do you have 28 million buckets on hand? Every day?

Much brighter minds than mine have worked on this project. TransCanada would not even think of putting this together if their clients (the producers or shippers of the oil) had not already signed contracts to use the pipeline. Trust me, they fit it in to the existing infrastructure in the best possible fashion.

Once again, you and everybody else is missing the real point. Obama is trying to decrease energy supply in the US. I know it might be hard to believe, but that is exactly what he is doing.

10 posted on 02/13/2012 5:49:02 PM PST by Former Proud Canadian (Obamanomics-We don't need your stinking tar sands oil, or the jobs that go with it.)
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To: raptor22
"Will Canadian Oil Be For the Lamps of China?"

"Lamps?" That's retarded. Canadian oil will be for the increasing manufacturing and hundreds of millions of new drivers in China, India and other "developing nations." Have fun. Enjoy the slide!


11 posted on 02/13/2012 5:49:43 PM PST by familyop (We Baby Boomers are croaking in an avalanche of rotten politics smelled around the planet.)
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To: raptor22

I would like to see all remaining republican candidates write a letter to prime minister of Canada and make a joint commercial, asking them to wait until after the Nov election to decide on the fate of the pipeline. I believe the commercial would have a big impact on the campaign.


12 posted on 02/13/2012 5:56:24 PM PST by morphing libertarian
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To: Former Proud Canadian

I am just asking the question... So you think that an oil refinery must be built on a seaport? I’m trying to understand why that should be. Is it just for shipping purposes, or do they need the water in order to run the plant? Because if it’s just for shipping purposes, then I’m not sure that makes all that much sense. Gasoline and other refined petroleum products are shipped by rail and by truck all the time. If Obama won’t let them build the pipeline, then you’d think they’d just say, “Fine. We’ll build a refinery, and leave you out of the picture altogether.”


13 posted on 02/13/2012 6:14:41 PM PST by Brilliant
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To: Brilliant
I repeat: Much brighter minds than mine have worked on this project. TransCanada would not even think of putting this together if their clients (the producers or shippers of the oil) had not already signed contracts to use the pipeline. Trust me, they fit it in to the existing infrastructure in the best possible fashion.

I don't know how to explain it any better. You have 800,000 b/d of oil that can be fed virtually seamlessly into the existing infrastructure through the Keystone XL. The sellers (shippers) and buyers (refiners) have signed contracts. They have come, now is the time to build it.

The gulf coast refineries have the excess capacity and the ability to refine this oil. They have the infrastructure in place to ship product on to the market.

I don't think you know how much 800,000 b/d is. The biggest refinery in Canada can only handle 300,000 b/d. And its a real big refinery. The Texas refineries have enough excess capacity to handle all that oil.

This is a huge resource, producing tremendous amounts of oil. This oil goes south on the Keystone XL or west over the mountains to an ocean terminal at Kitimat. From there three tankers a day will take it to world markets, probably in China. That's it. There is no other place for it to go. There are no other alternatives for that amount of oil originating in Northern Alberta.

14 posted on 02/13/2012 6:39:59 PM PST by Former Proud Canadian (Obamanomics-We don't need your stinking tar sands oil, or the jobs that go with it.)
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To: Former Proud Canadian

Yeah, well I agree with all that, but you’re not really answering the question. Maybe you don’t know the answer any more than I do. Personally, if I were the Canadians, and Obama had just dumped this pile on us, I would be thinking that it might make more sense to build another refinery than ship the oil over the Rockies and then to China. Building a new refinery would presumably produce more Canadian jobs than piping it across America to the US Gulf Coast as well.

Let Obama explain to his union constituents why he decided to ship the jobs to Canada instead of approving the pipeline.

BTW, I am convinced that once the election is over, and Obama’s environmentalist support is no longer relevant, Obama will approve it. He’s probably already assured the unions and the Canadians of that in order to calm them down.


15 posted on 02/13/2012 7:14:09 PM PST by Brilliant
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To: Brilliant
"Just build a refinery" is not an option. Period.

Once again we are talking about 800,000 barrels a day. Aren't you reading my posts? There isn't a single refinery in the world that can handle that volume. You can't "just build a refinery".

The oil goes south to Texas where the capacity and ability exists to refine this kind of oil or it goes west to China. That's it. That's all. The only other option is to "shut in" the production. In other words, not produce the oil.

16 posted on 02/13/2012 7:36:00 PM PST by Former Proud Canadian (Obamanomics-We don't need your stinking tar sands oil, or the jobs that go with it.)
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To: raptor22; exg; Alberta's Child; albertabound; AntiKev; backhoe; Byron_the_Aussie; ...

-


17 posted on 02/15/2012 5:00:07 AM PST by Clive
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To: raptor22; exg; Alberta's Child; albertabound; AntiKev; backhoe; Byron_the_Aussie; ...

-


18 posted on 02/15/2012 5:04:54 AM PST by Clive
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To: Former Proud Canadian; Brilliant; Clive

I’d like to know why we Canadians are paying ‘world’ prices for Gasoline.


19 posted on 02/15/2012 5:47:21 PM PST by fanfan (This is not my Father's Ontario. http://www.ontariolandowners.ca/)
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To: fanfan

FF, are you serious? So, you want your fuel consumption to be subsidized by your fellow taxpayer?


20 posted on 02/15/2012 6:36:44 PM PST by Former Proud Canadian (Obamanomics-We don't need your stinking tar sands oil, or the jobs that go with it.)
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To: fanfan

FF, are you serious? So, you want your fuel consumption to be subsidized by your fellow taxpayer?


21 posted on 02/15/2012 6:37:35 PM PST by Former Proud Canadian (Obamanomics-We don't need your stinking tar sands oil, or the jobs that go with it.)
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To: Former Proud Canadian

Hi FPC.
I’ve started to answer this post a few times, and keep deleting my replies.
Since I haven’t finished arguing with myself about it, I don’t yet have a reply for you.


22 posted on 02/21/2012 5:22:51 PM PST by fanfan (This is not my Father's Ontario. http://www.ontariolandowners.ca/)
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To: fanfan
Let me help you out.

Noname oil company gathers oil from a small field it owns near Edmonton. It sells the oil to a refiner in Edmonton, who offers the "world price" plus or minus a premium for grade of oil, volume, etc. The refiner refines the oil and sells off the product for everything from asphalt to naptha to unleaded gasoline to butane.

So, at what point do you want the government to intervene on your behalf to subsidize your energy costs? Should Noname receive less than the world price for oil from the refiner? How do you justify that? What is the mechanism? A taxpayers subsidy? Legislative fiat?

Do you intervene at the consumer level? Again, what is the mechanism? A direct subsidy or legislate lower revenues for the refiner/retailer?

Government intervention in the market in this manner simply does not work. Somebody has got to pay, somewhere if taxpayer subsidies are involved. If you simply legislate prices or revenues, the market will be distorted and producers will go elsewhere.

Just because God blessed our country with far more energy, mineral, and agricultural resources than we can use domestically does not mean that they are free, or should be. Or even that they should cost us less than can be gained if we export them.

Imagine that the government decided to subsidize gasoline sales by using taxpayer money to cut the retail price. Let's say I use 10 liters a day and you use 30. How is it fair that you get 3x the subsidy that I get? And how much should the subsidy be? 10 cents a liter? 40? 50? What is the optimum amount? Who decides?

These questions are unanswerable for conservatives. That's why we are against government subsides. We know they don't work, and no government anywhere can make sure that they are "fair".

23 posted on 02/21/2012 5:40:29 PM PST by Former Proud Canadian (Obamanomics-We don't need your stinking tar sands oil, or the jobs that go with it.)
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To: Former Proud Canadian
Thanks for fleshing this out with me.

I don't want the government, or any government, involved at all. I want the free market to rule...

We allow oil prices to be determined by the likes of OPEC. It is a price monopoly, and everyone sits by, and lets it happen.
I hate that those politicians decide how much I have to pay to fill my tank with gasoline, when we sit on so much oil.

Every time monopolies exist, they over charge.

24 posted on 02/22/2012 5:38:06 PM PST by fanfan (This is not my Father's Ontario. http://www.ontariolandowners.ca/)
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To: fanfan
Monopolies are the only time when the government should intervene in the market. That said, opec is not really a monopoly, or at least not one that we can't handle.

The tar sands represent the largest known oil reserve in the world. We need pipelines to bring that production to the market. Eventually both the Gateway and Keystone projects will be completed.

The way to end the opec "monopoly" is to outproduce them. Provide more energy in all forms and their influence on oil prices will wane. At certain price levels one form of energy will displace another.

I'll give you an exaggerated example that probably doesn't make economic sense, and might not even be technically feasible, but it illustrates the point. The US sits on the world's largest coal reserves. You can make oil out of coal. So, build enough coal to oil plants to satisfy domestic US needs. Say another 5 million B/D. That much oil on the world market would take a lot of opec's power away.

25 posted on 02/23/2012 3:48:25 AM PST by Former Proud Canadian (Obamanomics-We don't need your stinking tar sands oil, or the jobs that go with it.)
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To: Former Proud Canadian

I understand, but the trouble is that none of this is happening.
The US won’t drill for their own oil, Stephen Harper wants to give the world 2 more years to discuss our pipeline projects, and in the mean time, countries like Saudi Arabia control the price.

When gas first went to $4 US a gallon, George Bush just hinted at drilling and the world wide price went back down.

If there were more extraction and refinement of oil/gas in North America, it would provide good jobs here, and that means more revenue for the governments, but they can’t see that. Govs’. seem to think it’s better to collect a higher percentage on an ever increasing pump price. I’m so frustrated.

After talking with you about this, I realize I should not have used the term “world prices”, when what I really meant was, “overinflated prices”, or “politically driven prices”.


26 posted on 02/25/2012 2:18:14 PM PST by fanfan (This is not my Father's Ontario. http://www.ontariolandowners.ca/)
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To: fanfan
The US won’t drill for their own oil,

Correct, and a real problem for them. Big problem. Not sure if another country on earth would be making the mistake of NOT drilling for oil in their own country. Do you know how stupid that is?

Stephen Harper wants to give the world 2 more years to discuss our pipeline projects,

"wants" is pretty strong. I think they were totally dumbfounded by Obozo nixing the Keystone. They couldn't believe it. I don't think too many people in Canada thought that the US would nix an oil pipeline from Canada. It's ludicrous. There is no rational reason for it.

I don't think it will be 2 years. They just started to ship oil to China through the existing Trans-Mountain. Ironically, owned by US company Kinder. Kinder wants to double the capacity. That could be fast tracked. The oil will find a market. It is amazing that anybody wants to shut in that oil production. But there are forces afoot who want to do just that. And some of them got to the president.

When gas first went to $4 US a gallon, George Bush just hinted at drilling and the world wide price went back down.

Yes. Again, how ironic on so many levels.

If there were more extraction and refinement of oil/gas in North America, it would provide good jobs here, and that means more revenue for the governments, but they can’t see that.

Umm,ok, that means that governments that discourage this industry are either a) stupid or b) corrupt or c) elements of both. I'll buy that.

Govs’. seem to think it’s better to collect a higher percentage on an ever increasing pump price.

Yes.

About prices. You have two choices. You can refuse to buy the product OR you can speculate in the price. The problem is that the markets are even suspect these days. Trust in markets, government, and other institutions is falling because people regard them as either stupid or corrupt. But I digress.

27 posted on 02/25/2012 6:34:38 PM PST by Former Proud Canadian (Obamanomics-We don't need your stinking tar sands oil, we'll just grow algae.)
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