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Alberta Oilsands: Is the End Near?

Jack

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-Environmental organizations in Canada and the US are stepping up their campaign to derail Alberta`s oil sands and seeking funding from deep-pocketed endowments, including the Rockefeller Brothers Fund.-a multitude of green groups, including the New York-based Natural Resources Defense Council, Oregon-based Corporate Ethics International and Alberta based Pembina Institute, have formed a coalition to broaden their attack on the Canadian sector, targeting politicians, regulators, investors, communities and the media.

-They said they want to raise the negatives of the oil-sands industry, boost the costs of producing them, stop infrastructure development and enrol key decision-makers
.

-talk about "preventing" the proposed modification of US Securities & Exchange Commission rules on oil-sands reporting, which they say would encourage the business.

-The presentations show unflattering images of oilsands mines and refineries. Pictures of Stephen Harper, the Canadian Prime Minister, and Ed Stelmach, the Alberta Premier, are shown beside a banner that reads: "Canada, Keep Your Dirty Oil!"

-Susan Casey-Lefkowitz, a senior attorney with the NRCD and one of the presenters, said the environmental movement is uniting against the oil sands because it sees its extraction as "very destructive" to the environment and a major cause of global warming
.

-In addition to the Rockefeller Fund, other major endowments supporting anti-oil sands causes include the US$6B Pew Charitable Trusts
, a legacy of J. Howard Pew, founder of a company that eventually became oil-sands pioneer Suncor, and the William and Flora Hewlett Foundation
, a legacy of the co-founder of computer giant Hewlett Packard with assets of more than $7B
.

(National Post 081119)
 

Thomas Beyer

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Certainly other technologies should be promoted .. such as clean coal, nuclear, tidal energy, wind, solar .. but one issue is "the grid" to get this electricity to places where people live from where wind turbines or tidal plants or solar farms are ... and a 2nd issue is that gasoline is the most effective energy source per volume (i.e. for moving vehicles) as opposed to batteries which are very in-efficient per cubic foot of space ..

Better would be nuclear .. and that is why many large sub-marines or ships have a nuclear engine .. which would be impractible for a car of 4 people ..

Is off shore drilling or drilling in sensitive Alaska wildlife areas so much more desirable ?

Oil business, by definition, is dirty business ! Is oil from Saudi Arabia better / cleaner / more desirable ? or oil from the Gulf of Mexico with a pipe through 1000`s of meters of water or miles from shore .. is this "clean" energy ??

The only issue right now is that oil demand is down due to a world-wide recession .. and thus, in 1 or 2 or 3 years we will likely have a shortgage again .. and people complain: $2/litre or $6/gallon .. we need cheaper oil !!!
 

Allie

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The price of oil fell to $50US a barrel. What`s behind the curtain for Alberta real estate?
 

Conrad5

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QUOTE (MatzoB @ Nov 21 2008, 01:38 AM) The price of oil fell to $50US a barrel. What`s behind the curtain for Alberta real estate?


No need to panic. The question should be where will the price be in 5 to 10 years from now? The winter season coupled with many people all over the world cutting down on driving due to the current economic situation is the cause of the price drop. Imagine you are laid off work with your networth vanishing faster than you ever dreamt of would you drive as much as you normally do? NO. That is exatly what is happening expecially in the US. Even with the drop in gasoline prices, many who have switched to public transport during the time the Oil was $147 still take public transport. Demand will slow for now. Our focus should be on the long term and in that case I believe the Alberta Oil Sand has a future
 

rforgiel

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We will get back to $85 oil with wide volatility based on supply and demand when the economy recovers. The big spike in oil prices was driven by the difficulty in meeting demand especially when China and India were going full bore. The key parameter you need to look at is how China is using their oil. I don`t have the exact figures but about half is uses for transportation the other half is used for electricity production. China can curb its demand for oil by finding other ways to generate electricity; in the long term nuclear and in the shorter term dirty coal. This effect will keep oil demand inline with future production capabilities so we will not see Jeffery Rubin`s $200 oil.

The other effect you need to keep an eye on is when Obama mentions dirty energy sources. He is talking about the oil sands. It sounds like he would like to move away from this source of oil but in the short/medium term this does not seem practical.

Your oil sands industry has a bright future but may be not at the dizzying heights once talked about.

You need to get on your leaders to figure out what they plan to do with the oil wealth to create a robust economy into the very long term. Will they piss it away the way Britain did with their North Sea riches or like Norway use carbon taxes to invest in building longer term sustainable solutions. I know the carbon tax was vilified on this forum when Dion spoke about it but you do need to consider long term when you turn over your real estate holdings to your grand kids.

Regards,
Ramon Forgiel
 

Jack

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QUOTE The price of oil fell to $50US a barrel. What`s behind the curtain for Alberta real estate?

And the Canadian Dollar.
style_emoticons


Do the words "free fall" mean anything to you?
style_emoticons
 

Jack

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QUOTE Imagine you are laid off work with your networth vanishing faster than you ever dreamt of would you drive as much as you normally do? NO. That is exatly what is happening expecially in the US.

No, that is exactly what`s happened everywhere. Stock markets gains from about the last 5 years have been wiped out.

Will it bounce back? Who knows. But the reality is that it sets a lot
of people back and is a major shakeup to the global economy.
 

Thomas Beyer

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QUOTE (caglah @ Nov 21 2008, 02:38 AM) No need to panic. ... Imagine you are laid off work with your networth vanishing faster than you ever dreamt of would you drive as much as you normally do? NO. That is exatly what is happening expecially in the US.

and here to, btw ..

that is why Canmore or Kelowna or Vancouver Island 2nd home/condo sales are basically 0 .. all driven by oil money and big fat stock options which are now 0 for at least a year or 2 .. who knows how long ?

It`ll take a lot longer to sell a house / condo (be it new or old) and as such, cash-flow or a cash-reserve is paramount to hold !

Yes, there is no need to panic .. but there is a need to be VERY realistic, in AB or BC or SK, about:
a) rent levels (hint: down somewhat) and vacancies (up quite a bit)
b) house prices (hint: down)
c) migration patterns
d) job losses
e) cash-flow
f) availability and pricing of financing
g) length of time to get financing
h) length of time to sell
i) more demanding buyers / less buyers

In our firm we have now instituted rigorous cost control, and may even leave suites ugly and vacant as opposed to spending $5000 to $6500 per to fix up and re-rent for about a year to see how the (cold !!!) wind blows !


Don`t panic .. indeed .. but be VERY aware and cautious going forward until 2010 !!
 

Thomas Beyer

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QUOTE (rforgiel @ Nov 21 2008, 06:49 AM) We will get back to $85 oil with wide volatility based on supply and demand when the economy recovers.

indeed .. or higher .. but WHEN is that ? late 2009 ? 2010 ? 2011 ? Likely not Dec. 2008 or even May 2009 ...
 

mortgageman

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My two cents on oil prices is that $147 was an overshoot on the high side. $50 or $40 or $30 will be an overshoot on the downside.
If it costs x amount to produce a barrel of oil the price will rebound to x plus profit margin sooner or later, especially if companies and OPEC scale back production.
My understanding is hedge fund redemptions are what`s fueling the huge sell offs on the stock market. I imagine they are also having an impact on oil prices.
 

albainstar

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I agree with mortgageman
This is the swing to the otherside and it will end up resting somewhere in the middle

but at sometime it will shoot up again and stay there
it is a non renewable resorce afterall
 

Conrad5

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QUOTE (GarthChapman @ Nov 21 2008, 12:57 PM) And the big money is made during these big swings...


Loses are made during these swings as well
 

Thomas Beyer

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QUOTE (caglah @ Nov 21 2008, 03:00 PM) Loses are made during these swings as well
tell us HOW please ..
 
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