Canada’s energy sector has been hit hard by the recent oil price collapse that was initially set off by the now-ended Saudi Arabia-Russia price war and made much worse by the demand-destroying effects of the global COVID-19 pandemic lockdowns. The impacts on Canada’s crude oil and natural gas sectors have been both dramatic and nuanced. For example, oil supply cutbacks have been rapid and substantial, while there has been virtually zero impact on natural gas supplies. Oil demand has been similarly affected, with refined product demand seeing a large swoon, while natural gas demand has suffered only a modest pullback. And for Canada’s energy exports, these have experienced some jolting swings in a matter of weeks, putting the whole sector under pressure to adapt where possible. Today, we highlight some of the recent market disruptions and their implications.
Heads up! Today’s blog is a blatant advertorial for our upcoming RBN Studio Sessions, a new webinar series from RBN Energy looking at timely topics in the energy sector.
Canadian crude output is rising, requiring new export routes. As traditional pathways face constraints, the U.S. Rockies—especially the Guernsey, WY hub—are emerging as key corridors for moving Canadian heavy crude to downstream markets, including the Gulf Coast.
It was only a few months ago that Canada was boasting that it, like its southern neighbor, was hitting all-time highs for crude oil production. Production from the nation as a whole was pegged by the Canada Energy Regulator (CER) at just under 5 MMb/d as of January 2020, an increase of nearly 0.4 MMb/d from one year earlier. Recent expansions from the offshore East Coast added about 50 Mb/d, but the bulk of the gain came in the mighty Western Canadian Sedimentary Basin (WCSB) from an increase of more than 0.3 MMb/d in bitumen production in Alberta’s oil sands (Figure 1, covering data through March 2020) over the same 12-month span.
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About the song
"Alberta Bound" was written by Gordon Lightfoot and appears as the third cut on side one of Lightfoot's eighth studio album, Don Quixote. Personnel on the record were: Gordon Lightfoot (vocals, six- and 12-string acoustic guitar), Red Shea (hi-string guitar, nylon string guitar, dobro), Terry Clements (lead guitar), Rick Haynes (bass), Ry Cooder (mandolin) and Bob Thompson (string arrangements). In February 1988, Lightfoot performed "Alberta Bound" during the opening ceremonies for the 1988 Winter Olympics held in Calgary, AB.
Don Quixote was recorded between December 1971 and January 1972 at Amigo Studios in North Hollywood, CA, with Lenny Waronker producing. It was released in February 1972 and went to #42 on the Billboard Top 200 Albums chart. "Beautiful" was released as a single from the album and went to #58 on the Billboard Hot 100 Singles chart.
Gordon Lightfoot is a Canadian singer-songwriter folk and country music artist. He is often credited with helping to develop the folk-rock sound of the 1960s and ‘70s. Bob Dylan has called Lightfoot one of his favorite songwriters. Lightfoot has released 19 studio albums, three live albums, 19 compilation albums and 47 singles. He has won 16 Juno Awards and is a member of the Canadian Music Hall of Fame, Canadian Country Music Hall of Fame and the Songwriters Hall of Fame. He is a recipient of the Companion of the Order of Canada, the country's highest civilian honor. He still tours, although all of his remaining 2020 tour dates have been cancelled due to COVID-19.
Comments
Thanks for article regarding Canadian Gas.
Would be interesting to quantify volume North American Nat. Gas, pipelines suppling power generation facilities.
In reply to North American Gas by David Krentz
Highest daily gas burn recorded for the US was just over 45 Bcf/d in August 2019. Canadian gas power burn is much smaller with a max in Ontario at just over 1 Bcf/d, while Alberta can reach as high as 1.5 Bcf/d. Allow for smaller amounts of gas burn in other parts of Canada and max burn would in the range of 2.8 Bcf/d. All in, North American daily gas power burn could reach as high as 55 Bcf/d in the extremes. Most US gas fired power plants are connected to interstate pipes, so available pipe capacity to send gas to these plants is in excess of 60 Bcf/d. For Canada, gas use for power burn in Ontario is in decline, but pipe capacity to feed these plants is in the range of 1.5 Bcf/d. For Alberta, capacity to feed existing power plants is close to 1.4 Bcf/d. Gas power burn in Alberta could be rising by as much as an additional 1 Bcf/d by 2030 provided the provincial plan to phase out all coal plants is completed by then. Additional pipe capacity in that amount or more will presumably be added to the Alberta gas grid by that time.