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Government grants environmental approval for Prince Albert-area diamond mine

Government grants environmental approval for Prince Albert-area diamond mine

The announcement brings to an end what is thought to be the longest environmental approval process in Saskatchewan history.

ALEX MACPHERSON, SASKATOON STARPHOENIX

Updated: October 25, 2018

https://thestarphoenix.com/news/local-news/government-grants-environmental-approval-for-prince-albert-area-diamond-mine

Shore Gold FALC aerial

An aerial view of Star Diamond Corp.’s proposed Star-Orion-South Diamond Mine east of Prince Albert, Sask. (SUPPLIED/SHORE GOLD INC.)

 

The provincial government has signed off on a Saskatoon mining company’s plan to build a diamond mine east of Prince Albert, ending what is believed to be the longest environmental approval process in Saskatchewan history.

The announcement is sure to please Star Diamond Corp. and its investors, many of whom have sunk their savings into the project only to grow increasingly frustrated by delays, a lack of information, and languishing share prices.

It is not, however, likely to please members of nearby James Smith Cree Nation. A consultant hired to speak for the First Nation told the Saskatoon StarPhoenix earlier this month that Star Diamond’s environmental plan was “hopelessly flawed.”

In a statement on Thursday, Environment Minister Dustin Duncan said the $1.4-billion twin-open-pit diamond mine proposal has met government requirements that developments only proceed after “appropriate environmental safeguards” are in place.

“I am confident this project has met these requirements and the conditions of approval will mitigate environmental and community impacts,” Duncan said more than four years after the company submitted its final environmental impact statement.

The announcement on Thursday marks a significant milestone for Star Diamond — formerly known as Shore Gold Inc. — which has been working to build a mine in the kimberlite-rich Fort a la Corne forest since the mid-1990s.

The project is expected to create hundreds of construction jobs, employ about 700 people once it is operational and return about $6 billion in taxes and royalties to the province over its expected lifespan of 34 years.

Star Diamond CEO Ken MacNeill said in a statement that he is “very pleased” that the proposed project has received approval, and that the decision marks a “major milestone” toward the development of a diamond mine in Saskatchewan.

The approval is likely also good news for Rio Tinto Exploration Canada Ltd., a subsidiary of one of the world’s largest mining firms that has the option to buy up to 60 per cent of the project in stages for a total of about $75 million.

Paul Zimnisky, an independent diamond industry analyst based in New York, said that while concerns about capital expenditures remain, the approval is likely the “last piece of the puzzle” when it comes to Rio Tinto’s diamond-intensive plans.

“At this point, I think there’s a very high probability that it gets built,” Zimnisky said, referring to the company’s recent expressions of enthusiasm for the diamond industry.

A spokesman for the international mining giant referred comment back to Star Diamond.

In an interview earlier this month, James Smith Cree Nation spokesman Winston McLean suggested the First Nation’s accommodation demands, including access to resource revenues, were not being met and “everyone else (will get) wealthy.”

While revenue-sharing appears to be off the table, the government on Thursday confirmed that accommodations will include reserving a portion of the forest for band members’ use, and funding for various community and stewardship programs.

Once the surface lease is issued, Star Diamond must provide James Smith Cree Nation with a total of $161,250 for each year of the mine’s lifespan — an estimated $5.5 million — to fund various community and environmental programs.

The province on Thursday also confirmed it will involve the First Nation in environmental monitoring, and enter into “an agreement to provide training, jobs and business opportunities for James Smith Cree Nation and other local communities.”

The First Nation is expected to issue a statement on the decision Friday morning.

Star Diamond’s project, currently known as the Star-Orion-South Diamond mine for the properties on which it will be built, was granted federal environmental approval in 2014. Both levels of government must approve the project for it to move forward.

While a green light from the province is not the final step — more permits are required, as well as a plan to finance construction of the mine should it proceed — environmental approval is a major hurdle Star Diamond has now cleared.

In an interview earlier this month, one of the many investors who outlined concerns and frustrations to the Saskatoon StarPhoenix said the provincial government was “holding people’s future in the palm of their hands.”

“Diamond mining is the least caustic and the least impactful to the environment of all mining types out there,” said Thomas Griffith, who claims to own a sizeable stake in the company. “This project should have been approved in four to six months.”

Star Diamond’s share price jumped 25 per cent, to $0.34 from $0.27, in the first hour after the approval was announced.

 

 

Province gives environmental approval to diamond mine project

Province gives environmental approval to diamond mine project

Saskatoon / 650 CKOM

Bryn Levy

From https://www.ckom.com/2018/10/25/427815/

October 25, 2018 02:34 pm

star

Workers do underground sampling at the site of the proposed Star-Orion South diamond mine, located about 65 km east of Prince Albert, Sask. (Star Diamond Corporation)

If you can wait a while to propose, there’s a chance you could be slipping a little piece of Saskatchewan onto that special someone’s finger.

The province announced Thursday a proposed diamond mine has cleared a years-long environmental assessment process.

If built, the Star-Orion South diamond mine would be located in the Fort à la Corne Forest, about 65 kilometres east of Prince Albert.

Eric Anderson, executive director of the Saskatchewan Mining and Industry Supply Association, said the lengthy environmental review was the last major hurdle for the project to clear on the government side.

“This is the big one. This was probably, to-date, one of the largest approvals (the province) would have required to get a mine built.”

In a media release issued Thursday, the province explained that Star Diamond Corporation will still need to secure a few more permits at the municipal and provincial levels, including a surface lease, a water rights licence and highway access permits.

Anderson said the next major step will be the company’s board signing off on starting construction.

He said he was confident the company would eventually proceed, given the advantages of the site compared to more remote locations.

“I mean, you’ve got a road there, you’ve got telephone, you’ve got grid power — you’re not having to fly in fuel to generate electricity. You’ve got employees there so you don’t have to build a camp. It’s quite a good thing and Prince Albert should do quite well out of this.”

If built, the province would stand to collect billions of dollars in royalties and taxes over the estimated 34-year life of the mine.

Mining giant Rio Tinto is also involved with the project, with a subsidiary of the company having secured an option to buy up to a 60 per cent stake for $75 million.

Anderson said Rio Tinto has made no secret about its ambitions to be in the diamond business, adding extra incentive for the project to eventually get the green light to be built.

“This is potentially a major, long-life supply that could last them for decades. So, I would say the odds are pretty good that it would go ahead.”

With Saskatchewan already a powerhouse in mining potash and uranium, Anderson said a diamond mine would help insulate the province’s economy from the ups-and-downs of those markets.

“You know, uranium is having some struggles right now. Potash is on a historical trend of normalcy, but this would be a great addition to the mix.”

Star-Orion South would employ about 700 people once built.

According to the province, the environmental assessment process led to a number of agreements with the nearby James Smith Cree Nation.

Those included:

  • A compensation plan for any fish habitat disturbed by the mine and a commitment to ongoing monitoring of air and water quality over the duration of the project’s life.
  • Funding for monitoring of moose and elk populations.
  • An agreement to provide training, jobs and business opportunities for people in James Smith and other local communities
  • A management plan for the Fort à la Corne Forest allowing for access to and protection of designated areas for treaty rights and traditional uses.

 

Star – Orion South Diamond Project Approved by Provincial Minister of Environment

Star – Orion South Diamond Project Approved by Provincial Minister of Environment

TSX: DIAM                                                                                               

SASKATOON, Oct. 25, 2018 /CNW/ – Star Diamond Corporation (“Star Diamond” or the “Corporation”), is pleased to announce that the Saskatchewan Ministry of Environment (“Ministry”) has approved the Corporation’s Star – Orion South Diamond Project (“the Project”), located in the Fort à la Corne diamond district of central Saskatchewan, Canada, on mineral dispositions held 100 percent by Star Diamond.

The Environment Minister of Saskatchewan Dustin Duncan announced approval for the Project under The Environmental Assessment Act, indicating the “The Star-Orion South Diamond Mine is a major development with the potential to bring jobs to the area and diversify Saskatchewan’s economy”. A copy of the Project decision can be found at publications.gov.sk.ca/deplist.cfm?d=66&c=4428. The Canadian Environment Assessment Agency previously announced a positive federal Environmental Assessment Decision for the Project (see News Release dated December 3, 2014).

Kenneth E. MacNeill, President and CEO states: “This approval, alongside the previous positive Federal decision, marks a major milestone towards the development of a diamond mine in Saskatchewan. We have previously demonstrated that the proposed Star – Orion South Diamond Project can be successfully constructed and operated and are very pleased that the Project has now received positive federal and provincial environmental decisions. This milestone is the result of the significant work and effort of the Ministry, our technical team and consultants, and represents our commitment to our stakeholders and the community surrounding the Project. As illustrated by the preliminary economic assessment, the Project has the potential to generate billions of dollars of corporate and municipal taxes and royalties, while also providing direct employment for hundreds of people throughout the construction phase and some 700 people continuously over its 38 year mine life.”

The Ministry has indicated that they conducted a thorough environmental assessment for the Project, including a detailed environmental impact statement, and carried out in-depth consultation prior to the decision to approve the Project. This included fulfilling the Province’s duty to consult responsibility. The Government of Saskatchewan consulted with local First Nations and Métis communities and has developed accommodations that will address potential adverse impacts to Treaty rights and traditional uses. Prior to proceeding with the Project, further provincial and municipal permits and approvals will be required.

About Star Diamond Corporation

Star Diamond Corporation is a Canadian based corporation engaged in the acquisition, exploration and development of mineral properties. Shares of the Corporation trade on the TSX Exchange under the trading symbol “DIAM”. The Corporation’s Star – Orion South Diamond Project is located in central Saskatchewan some 60 kilometres east of the city of Prince Albert. The Project is in close proximity to established infrastructure, including paved highways and the electrical power grid, which provide significant advantages for future mine development.

The Corporation recently announced the positive results of the independent Preliminary Economic Assessment (“PEA”) on the Project. The PEA estimates that 66 million carats of diamonds could be recovered in a surface mine over a 38-year Project life, with a Net Present Value (“NPV”) (7%) of $2.0 billion after tax, an Internal Rate of Return (“IRR”) of 19% and an after-tax payback period of 3.4 years after the commencement of diamond production (see News Release dated April 16, 2018). Star Diamond commissioned the PEA and related Technical Report for the Star and Orion South Kimberlites and, as such, the PEA and Technical Report are the sole responsibility of the Corporation. The PEA is based on exploration and evaluation work conducted up to and including March 2017.

During 2017, the Corporation granted Rio Tinto Exploration Canada (“RTEC”) an option to earn up to a 60% interest in the Corporation’s Fort à la Corne mineral properties (including the Star-Orion South Diamond Project) on the terms and conditions contained in the Option Agreement (see News Release dated June 23, 2017). RTEC refers to Star Diamond’s mineral dispositions in the Fort à la Corne diamond district as Project FalCon.

All technical information in this press release has been prepared under the supervision of George Read, Senior Vice-President of Exploration and Development, a registered Professional Geoscientist in the Provinces of Saskatchewan and British Columbia and Mark Shimell, Project Manager, a registered Professional Geoscientist in the Province of Saskatchewan, who are the Corporation’s “Qualified Persons” under the definition of NI 43-101.

Caution Regarding Forward-Looking Statements

This news release contains forward-looking statements as defined by certain securities laws, including the “safe harbour” provisions of Canadian securities legislation and the United States Private Securities Litigation Reform Act of 1995. Forward-looking information is often, but not always, identified by the use of words such as “anticipate”, “believe”, “expect”, “plan”, “intend”, “forecast”, “target”, “project”, “guidance”, “may”, “will”, “should”, “could”, “estimate”, “predict” or similar words suggesting future outcomes or language suggesting an outlook. In particular, statements regarding the Corporation’s future operations, future exploration and development activities or other development plans constitute forward-looking statements. By their nature, statements referring to mineral reserves, mineral resources, PEA or TFFE constitute forward-looking statements.

Forward-looking statements contained or implied in this press release include, but are not limited to, disclosure regarding the economics and project parameters presented in the PEA, including, without limitation, IRR, NPV and other costs and economic information, carats of diamonds to be recovered, after-tax payback period, tonnes of kimberlite to be mined, carats per tonne to be recovered (grade), diamond prices, project life, life of mine, capital costs, and length of pre-production period. These forward-looking statements are based on the Corporation’s current beliefs as well as assumptions made by and information currently available to it and involve inherent risks and uncertainties, both general and specific.

Risks exist that forward-looking statements will not be achieved due to a number of factors including, but not limited to, developments in world diamond markets, changes in diamond prices, risks relating to fluctuations in the Canadian dollar and other currencies relative to the US dollar, changes in exploration, development or mining plans due to exploration results and changing budget priorities of the Corporation or its partners, the effects of competition in the markets in which the Corporation operates, the impact of changes in the laws and regulations regulating mining exploration, development, closure, judicial or regulatory judgments and legal proceedings, operational and infrastructure risks and the additional risks described in the Corporation’s most recently filed Annual Information Form, annual and interim MD&A. The Corporation’s anticipation of and success in managing the foregoing risks could cause actual results to differ materially from what is anticipated in such forward-looking statements.

Although management considers the assumptions contained in forward-looking statements to be reasonable based on information currently available to it, those assumptions may prove to be incorrect. When making decisions with respect to the Corporation, investors and others should not place undue reliance on these statements and should carefully consider the foregoing factors and other uncertainties and potential events. Unless required by applicable securities law, the Corporation does not undertake to update any forward-looking statement that is made herein.

SOURCE Star Diamond Corporation

For further information:

stardiamondcorp@stardiamondcorp.com or Kenneth E. MacNeill, President and Chief Executive Officer at (306) 664-2202, www.stardiamondcorp.com

This information is being distributed to you by / Cette information vous est transmise par : Star Diamond Corporation

600 – 224 4th Avenue South, Saskatoon, SK, S7K 5M5, Canada
http://www.stardiamondcorp.com

 

Saskatchewan’s oil and gas supply chain meets face-to-face with buyers

Saskatchewan’s oil and gas supply chain meets face-to-face with buyers  https://simsa.ca/event/4th-annual-saskatchewan-oil-and-gas-supply-chain-forum/ 

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Nuclear is the safest source of energy

The Safest Source of Energy Will Surprise You

JEFF DESJARDINS

on May 10, 2018 at 6:27 pm

From http://www.visualcapitalist.com/worlds-safest-source-energy/

Energy safety

The World’s Safest Source of Energy Will Surprise You

When it comes to conversations on energy, it’s hard to leave your feelings at the door.

It’s arguable that energy is the single most important driver of human progress – it’s a multi-trillion dollar industry that powers our daily lives, technological advancements, and even the economic development of entire countries. At the same time, our choices around energy can have significant consequences. How we decide to generate energy can decimate the environment, fuel political conflicts, and even cause human deaths as unwelcome side effects.

The outcomes from our choices around energy are so vivid, that we’ve developed strong and polarized associations with the subject at hand.

THE EMPIRICAL PERSPECTIVE

Today’s visualization on the safest sources of energy comes to us from Cambridge House, the company hosting the International Mining Investment Conference 2018 on May 15-16 in Vancouver, BC, and it uses an empirical approach to compare different energy sources with one another.

Based on the data, this comparison provides a perspective that will be surprising to many viewers. Despite its perceived dangers, nuclear is actually the safest type of energy.

Energy Source Deaths per 1,000 TWh % of Global Primary Energy Supply (2015)
Coal 100,000 28.1%
Oil 36,000 31.7%
Natural Gas 4,000 21.6%
Hydro 1,400 2.5%
Solar 440* <1%
Wind 150 <1%
Nuclear 90 4.9%

That’s right – even when including seemingly catastrophic incidents such as Chernobyl and Fukushima in the calculations, the math says that the amount of energy generated by nuclear is so vast that it more than outweighs these incidents over the long-term.

The reality is that nuclear energy is much more comparable to renewables like solar or wind, in terms of safety. More importantly, it’s on the polar opposite of the spectrum from coal, which manages to kill 4,400 people daily in China alone.

THE NUCLEAR OPTION

Interestingly, multiple studies have come to this exact same conclusion, including the ones used in an analysis by economist Max Roser’s project called Our World in Data.

Even though the conclusion on nuclear is pretty cut and dry, it’s still hard to absorb. After all, the relative safety of nuclear ends up being extremely counter-intuitive to our human brains, which are seemingly wired to put more weight on big, memorable events (i.e. Chernobyl) rather than slow, consistent deaths that occur over time with other energy sources.

Today, nuclear provides about 11% of the world’s electricity from about 450 power reactors, generating about 2,500 TWh of electricity each year.

And while there are still questions that remain – specifically revolving around how to store certain types of nuclear waste – the above data explains why the majority of scientists classify nuclear as a sustainable and safe energy source, along with other renewables.

Star – Orion South Diamond Project Technical Update: Bulk Sample Plant Designed and Ordered

Star – Orion South Diamond Project Technical Update: Bulk Sample Plant Designed and Ordered

Shore Gold FALC aerial

TSX: DIAM

SASKATOON, May 15, 2018 /CNW/ – George H. Read, P. Geo., Senior Vice President Exploration and Development of Star Diamond Corporation (“Star Diamond” or the “Corporation”) is pleased to announce that Rio Tinto Exploration Canada (“RTEC”), and Consulmet (Pty) Ltd (“Consulmet”) have finalized contractual arrangements for the manufacture and supply of a 30 tonne per hour (“tph”) bulk sample plant. This bulk sample plant will be used to process the kimberlite recovered by the next phase of large diameter, bulk sample drilling on the Star – Orion South Diamond Project (“Project”). The bulk sample plant will be fabricated by Consulmet in South Africa in modular, containerized units, which will facilitate shipment to the Project site in central Saskatchewan. Consulmet is a specialised technology company serving the minerals industry through the design and supply of production ready mineral processing plants.

Bulk Sample Plant

The proposed bulk sample plant will use a modern flowsheet and the latest X-ray transmission (“XRT”) sorting technology to ensure any large diamonds present (up to 25 millimetres) are recovered with minimal breakage. A secondary crushing circuit, using a high pressure rolls crusher (“HPRC”), will maximize the liberation of smaller diamonds from the kimberlite. The bulk sample plant consists of four areas, each with its own control system: 1) a wet front-end and feed preparation area; 2) an XRT sorter area; 3) a 10 tph dense media separator (“DMS”) area; and 4) a water reticulation area.

Washed Run of Mine (“ROM”) kimberlite (-80 millimetres), collected in bulk bags, from Bauer Maschinen GmbH (“Bauer”) BE550 desanding equipment at the drill site, will be supplied to the front-end of the plant. Initial scrubbing and screening sends coarse -80+25 millimetre kimberlite to the jaw crusher, and removes all -0.85 millmetre fines using a slotted screen. Thereafter, -25+12 and -12+6 millmetre kimberlite fractions are processed through the XRT sorter in two simultaneous feeds. The XRT sorter accepts are stored in a secure bin for subsequent diamond recovery. The -25+6 millimetre XRT sorter rejects are sent to a secondary HPRC and the crushed product is returned to the primary feed. The -6+0.85 millimetre kimberlite fraction is processed through the DMS cyclone to prepare a diamond-bearing heavy mineral concentrate. Final diamond recovery is to be conducted at a secure off-site facility. Plant process water is recovered from various de-watering screens within the plant and the fines thickener, and returned to a recycled water storage facility. Fresh and recycled water are used in the primary plant feed. The underflow from the thickener (-0.85 millimetre) is sent as residue to an on-site fines management area (“FMA”).

Senior Vice President Exploration and Development, George Read, states: “Star Diamond Corporation is in complete support of the design and equipment selection for the bulk sample plant. The modern flowsheet and state-of-the-art XRT sorting technology used in this plant will replicate the flowsheet and equipment of the processing plant that would be used on a potential future diamond mine. This bulk sample plant is specifically designed to maximize liberation and recovery of diamonds throughout the -25+0.85 millimetre size range, and minimize diamond breakage, particularly among potential specials (plus 10.8 carat stones) that may be recovered from both the Star and Orion South Kimberlites.”

About Star Diamond Corporation

Star Diamond Corporation is a Canadian based corporation engaged in the acquisition, exploration and development of mineral properties. Shares of the Corporation trade on the TSX Exchange under the trading symbol “DIAM”. The Corporation’s Star – Orion South Diamond Project is located in central Saskatchewan some 60 kilometres east of the city of Prince Albert. The Project is in close proximity to established infrastructure, including paved highways and the electrical power grid, which provide significant advantages for future mine development.

The Corporation recently announced the positive results of the independent Preliminary Economic Assessment (“PEA”) on the Project. The PEA estimates that 66 million carats of diamonds could be recovered in a surface mine over a 38-year Project life, with a Net Present Value (“NPV”) (7%) of $2.0 billion after tax, an Internal Rate of Return (“IRR”) of 19% and an after-tax payback period of 3.4 years after the commencement of diamond production (see News Release dated April 16, 2018). Star Diamond commissioned the PEA and related Technical Report for the Star and Orion South Kimberlites and, as such, the PEA and Technical Report are the sole responsibility of the Corporation. The PEA is based on exploration and evaluation work conducted up to and including March 2017.

During 2017, the Corporation granted RTEC an option to earn up to a 60% interest in the Corporation’s Fort à la Corne mineral properties (including the Star-Orion South Diamond Project) on the terms and conditions contained in the Option Agreement (see News Release dated June 23, 2017). Completion of the proposed 2018 sampling program (First Option) does not entitle RTEC to an interest in the Corporation’s 100 percent held Fort à la Corne mineral properties (including the Project).

All technical information in this press release has been prepared under the supervision of George Read, Senior Vice-President of Exploration and Development, a registered Professional Geoscientist in the Provinces of Saskatchewan and British Columbia and Mark Shimell, Project Manager, a registered Professional Geoscientist in the Province of Saskatchewan, who are the Corporation’s “Qualified Persons” under the definition of NI 43-101.

Caution Regarding Forward-Looking Statements

This news release contains forward-looking statements as defined by certain securities laws, including the “safe harbour” provisions of Canadian securities legislation and the United States Private Securities Litigation Reform Act of 1995. Forward-looking information is often, but not always, identified by the use of words such as “anticipate”, “believe”, “expect”, “plan”, “intend”, “forecast”, “target”, “project”, “guidance”, “may”, “will”, “should”, “could”, “estimate”, “predict” or similar words suggesting future outcomes or language suggesting an outlook. In particular, statements regarding the Corporation’s future operations, future exploration and development activities or other development plans constitute forward-looking statements. By their nature, statements referring to mineral reserves, mineral resources, PEA or TFFE constitute forward-looking statements.

Forward-looking statements in this press release include, but are not limited to, disclosure regarding the economics and project parameters presented in the PEA, including, without limitation, IRR, NPV and other costs and economic information, carats of diamonds to be recovered, pre-tax payback period, tonnes of kimberlite to be mined, carats per tonne to be recovered (grade), diamond prices, life of mine, capital costs, length of pre-production period, possible events, conditions or financial performance that is based on assumptions about future economic conditions and courses of action; the timing and costs of future development and exploration activities on the Corporation’s projects; success of development and exploration activities; permitting time lines and requirements; time lines for further studies; planned exploration and development of properties and the results thereof; specifications and design of the proposed bulk sampling plant; and planned expenditures and budgets and the execution thereof as well as statements with respect to RTEC’s and the Corporation’s objectives for the ensuing year.

These forward-looking statements are based on the Corporation’s current beliefs as well as assumptions made by and information currently available to it and involve inherent risks and uncertainties, both general and specific.

Risks exist that forward-looking statements will not be achieved due to a number of factors including, but not limited to, developments in world diamond markets, changes in diamond prices, risks relating to fluctuations in the Canadian dollar and other currencies relative to the US dollar, changes in exploration, development or mining plans due to exploration results and changing budget priorities of the Corporation or its partners, the effects of competition in the markets in which the Corporation operates, the impact of changes in the laws and regulations regulating mining exploration, development, closure, judicial or regulatory judgments and legal proceedings, operational and infrastructure risks and the additional risks described in the Corporation’s most recently filed Annual Information Form, annual and interim MD&A. The Corporation’s anticipation of and success in managing the foregoing risks could cause actual results to differ materially from what is anticipated in such forward-looking statements.

Although management considers the assumptions contained in forward-looking statements to be reasonable based on information currently available to it, those assumptions may prove to be incorrect. When making decisions with respect to the Corporation, investors and others should not place undue reliance on these statements and should carefully consider the foregoing factors and other uncertainties and potential events. Unless required by applicable securities law, the Corporation does not undertake to update any forward-looking statement that is made herein.

SOURCE Star Diamond Corporation

For further information:

stardiamondcorp@stardiamondcorp.com or (306) 664-2202, www.stardiamondcorp.com

This information is being distributed to you by / Cette information vous est transmise par : Star Diamond Corporation

224 – 4th Avenue SouthSuite 300 Suite 300, Saskatoon, SK, S7K 5M5, Canada
http://www.stardiamondcorp.com

The Root Cause of Pipeline Paralysis

See also a video interview here

The Root Cause of Pipeline Paralysis – David Yager

David Yager

By David Yager

Oilfield Services Executive Advisory – Energy Policy Analyst

April 18, 2018

In 1947 Winston Churchill opined, “Democracy is the worst form of government …except all the others”. This was shortly after the second world war, the rise of the Soviet Union, the middle of a civil war in China that would shape its future, and the early stages of multiple and often bloody struggles for independence across Africa. The warts of democracy paled in comparison to what was going on in the non-democratic world.

Seventy years later the best of the worst is still going backwards. Two bright lights of democracy in the past 100 years have been Canada and the United States. In their formative years settlers from all over left behind their problems and tribalism to carve a new, free and prosperous life in large and relatively unpopulated land. The immigrants fled all manner of distress, misery and oppression to seek political, economic and religious freedom. Why else would you voluntarily abandon family and history to seek a better life in the middle of nowhere?

They once called the U.S. a “melting pot” of mixed races, cultures and religions because they had left their old problems and battles behind to collectively build a new and better society and country.

But the recent actions of the government of British Columbia illustrates the problems caused by tribalism and demonstrates many modern North Americans forgot where they came from and why they left. Tribalism occurs when one group of a society intentionally persecutes another without regard to consequences. It is routinely exploited by ambitious politicians. This is the real problem for petroleum and pipe, and heaping scorn on John Horgan and Andrew Weaver or economically punishing the citizens of B.C. as revenge will not solve it.

Tribalism is defined in the Cambridge Dictionary as, “a very strong feeling of loyalty to a political or social group, so that you support them whatever they do”. Most would agree that tribalism has been, and continues to be, the cause of problems and misery around the world.

How does tribalism manifest itself in Canada? When on a regional or social basis common emotions or beliefs are so powerful that facts or collateral damage no longer matter. The end overwhelms the means and consequences. There cannot be a better example than oil sands and pipelines. While examples of fact versus fiction are voluminous, here’s an excerpt from the Roy Green radio talk show on April 15 shortly after Premier Horgan, Premier Notley and Prime Minister Trudeau emerged from their Kinder Morgan Trans Mountain Pipeline Expansion (TME) chinwag in Ottawa.

A female caller from Burnaby stated with great confidence, “…they did some research and predicted with the pipeline we would not have any killer whales left.” Asked for clarification from the host she answered, “The increase in tanker traffic would be detrimental to the killer whales on the coast. Let’s not forget who they (TME) are run by –  which is Enron. We can’t trust they would be around if there was a spill”.

Worse than we ever imagined. Enron is already dead. Haven’t heard about Enron since the Notley government blamed the much-vilified company for an alleged loophole in electricity generation contracts.

It is, of course, just another example of the absolute rubbish in the brains of too many people opposed to oil sands and pipelines. TME admits there would be about a 14% increase in shipping traffic in Vancouver harbor which accepts and dispatches about 3,000 big boats a year including cruise ships. But that’s not where the whales live, nor does it include other big boats in the Strait of Georgia like B.C. ferry sailings from Tsawwassen and Horseshoe Bay to Vancouver Island and the up the coast. The larger ferry sailings total about 60 a day or nearly 22,000 per year. This does not include smaller vessels serving the Gulf Islands.

When you put TME’s 444 annual sailings over the existing 25,000, TME would increase TOTAL large water craft traffic in the waterways originating in greater Vancouver by 1.8%, not 14%. Unless oil sands can somehow radiate an as-yet unidentified toxin through the tanker hull and kill whales by simply passing nearby, how a 1.8% increase in total large boat traffic will result in a 100% decline the killer whale population is incomprehensible.

But when tribalism trumps common sense or logic, facts don’t matter. This is something anyone who has tried to talk sense into the opponents of oil sands or pipelines has learned by now. Worse, using the internet and social media, opponents have been able to disseminate enormous quantities of misinformation. This is where “fake news” comes from. The device in your pocket regurgitates reams of it every time you turn it on. If it supports your own views or doubts, you believe it. Even if it is wrong.

Going back to the hardened opponents of TME, the impact of a theoretical dilbit spill (that in all statistical likelihood will never happen) might have on the waters and coastline of B.C. is far more important than quantifiable economic damage selling oil sands at a discount is having on their fellow Canadians and international investment. Tribalism at its best, or worst. The only thing that matters is me.

When the NDP and Greens campaigned against TME in the 2017 election, they put forward policies by which their political success was dependent upon inflicting direct economic damage on a neighboring province and fellow Canadians. They did this by exploiting economic ignorance, regional biases, and a mountain of mistruths and misconceptions about oil sands, pipelines and alternative energy sources.

Wow. I know tribalism is a strong word. But when one group of a society (Canada used to think of itself as a civil society) doesn’t care what happens to other groups of that society – and uses the political process to persecute them – we are in uncharted territory. At least in my obviously romantic and outdated view of our country.

Politicians long ago figured out how to identify tribalism and turn it into votes. It’s how all political parties conduct business. The process is about identifying which issues attract which voters, determine who they are, then ensure they turn out on election day. With the internet and social media, it has never been easier or more accurate. These tools didn’t exist 10 or even 5 years ago.

I’m so old I remember the days when political parties campaigned on honest government, good public services and low taxes. Ancient history. In 1974 Pierre Trudeau’s election slogan was, “The Land Is Strong”.

While not exactly stated this way, the NDP and Green campaign slogan was, “Vote For Me And I’ll Screw Alberta”. The land is not strong.

The current Cambridge Analytica scandal is modern politics on social media steroids. Using 87 million names and profiles from Facebook, Cambridge Analytica is accused of influencing everything from England’s Brexit vote to elections in the United States and Africa.

The indignation about the Cambridge imbroglio is not about the morality of using data to sway voters but how the data was obtained. Find your tribe and give them what they want. This is a given and clearly acceptable. This scandal is about how, not what.

And the biggest tribe is the politicians. Their behavior is laser focused when seeking and retaining public office. When successful, the elected politician will then do whatever is required to please the voters who secured them the best job most have ever had in their lives. There are two elements. The first is there is nothing more important than staying in office. The second is those who campaign on one thing then do something else are criticized by the media, commentators, their supporters and their opponents.

The arrest of two federal politicians at TME Burnaby terminal – Burnaby-South NDP MP Kennedy Stewart and Saanich-Gulf Islands MP and Green Party Leader Elizabeth May – illustrate how far modern politicians go to retain support. Both knew that whatever consequences might arise from proudly being arrested for breaking the law, it wouldn’t cost them any votes in their tribe. It’s a badge of honor. Law? But what about the next election?

Polls indicate the majority of British Columbians support TME. But they won’t vote for Stewart or May so who cares? Roll the TV cameras.

And so it goes as the democratically elected leaders of B.C., Alberta and Canada duke it out in the media over the future of TME. Although some progress appears to have been made in Ottawa April 15, regrettably the solution involves other people’s money, that of federal and Alberta taxpayers. B.C. remains recalcitrant.

People assail B.C. Premier John Horgan for being irrational and obstructionist and bombard him with a mountain of facts about jobs, the economy and damaging foreign investment. Irrelevant. He knows where his votes are and if he doesn’t, Green Party Leader Andrew Weaver, who holds the balance of power and thus Horgan’s tenure as premier, certainly does.

One of Horgan’s loyal supporters claims with certainty TME tankers will wipe out the killer whales. Be assured the B.C. Premier will make no effort to temper the views of any of his supporters, even when they spout absolute nonsense.

Albertans are generally pleased with Premier Rachel Notley’s recent conversion from an apologist for Alberta’s oil industry to a supporter. Because of the economic damage B.C. has intentionally inflicted on Alberta, Notley’s expanded tribe (at least for now) wants revenge. Therefore, legislation has been passed to throttle back the flow of oil and refined products through the existing Trans Mountain pipeline and drive up the price of fuel in B.C. The effective date has been synchronized with Kinder Morgan’s May 31 deadline for a clear path to construction with minimal disruption. But if B.C. comes up with any more bright ideas before then, the legislation will be put into effect immediately.

Economic warfare among two neighboring provinces based on a decade of lies about the toxicity of oil sands. Politicians and environmentalists who expound about an energy future of clean renewables that doesn’t exist.  Shameless political pandering to tribes of voters to achieve power at any cost. What a mess.

The person with the toughest assignment in keeping his multitude of tribes happy is Prime Minister Justin Trudeau. But this is self-inflicted because in the 2015 election he promised to be everything to everybody. He proposed banning tankers on B.C.’s northern coast which he did a year later. He campaigned on rebuilding the National Energy Board because it kept making logical technical and commercial decisions to approve pipelines which might cost Liberals votes.

Once elected he raised corporate taxes, introduced carbon taxes, looked the other way when the NEB cancelled the Energy East hearings, and did not in any way censure Quebec when it cheered following the cancellation of Energy East.

Trudeau has mused publicly about how Canada will be a better place once we no longer produce oil sands. Since then he has had to “clarify” his comments by extending the timeline. Ironically, and as Trudeau has stated over and over again in recent weeks, he is also supposed to be TME’s biggest ally. And tragically, TME’s only hope.

The Liberals elected 18 of the 42 MPs in B.C. in 2015, many in the anti-pipeline lower mainland region where Trudeau’s election commitments have come back to haunt him. Quebec, where the Liberals hold 42 of 77 seats, has publicly warned the federal government not to be too heavy-handed on the rights of other provinces to object to pipelines should they be so inclined.

This has caused pundits to wonder whether the Liberals will support the economy with TME or support themselves in the provinces where they hold 95 seats, two provinces not friends of oil sands or pipelines. The recent actions promised by Ottawa are, however, encouraging.

What does this all mean? How do you win a debate when facts don’t matter and complete nonsense is routinely spouted as the truth?

How do you influence a political process and the behavior of elected leaders who are increasingly beholden to a coalition of narrow, single issue power bases that are utterly doctrinaire and no longer respond to ancient concepts of economic growth or supporting your fellow citizens?

We read over and over again how false news affects elections. Most thought this was a U.S./Trump/Clinton/Russia issue. Nope. It is right in our face.

The first step is to fully grasp the problem. The next is to understand the solution.

Politicians will gravitate to votes wherever they are. Righteous fulmination in the multitude of modern media outlets is preaching to the converted. So long as the tribal leaders are doing the talking, their supporters will remain firm.

Our industry must speak to the voters, not the politicians or each other. Maybe the upcoming Ontario election will give us a glimmer of hope that the common sense of the common people can still save the country.

Detecting the flaws in democracy 150 years before Winston Churchill, U.S. President Thomas Jefferson said, “An educated citizenry is a vital requisite for our survival as a free people.” Now we know who to talk to.

About David Yager – Yager Management Ltd.

Based in Calgary, Alberta, Canada, David Yager is a former oilfield services executive and the principal of Yager Management Ltd. Yager Management provides management consultancy services to the oilfield services industry in a number of areas including M&A, Strategic Planning, Restructuring and Marketing. He has been writing about the upstream oil and gas industry and energy policy and issues since 1979.

See David Yager’s Corporate CV
List of David Yager’s Consulting Services
David Yager can be reached at Ph: 403.850.6088 Email: yager@telus.net

Former Saskatchewan Premier Brad Wall joins Osler’s Calgary office

Former Saskatchewan Premier Brad Wall joins Osler’s Calgary office

KELLY CRYDERMAN

CALGARY

PUBLISHED MAY 1, 2018

wall cbc

https://www.theglobeandmail.com/business/streetwise/article-former-saskatchewan-premier-brad-wall-joins-oslers-calgary-office/

A long-held wish from the country’s oil patch is coming true – former Saskatchewan premier Brad Wall is setting up shop in Calgary’s downtown.

Law firm Osler announced Tuesday that Mr. Wall has joined its Calgary office as a special adviser.

“Our firm and our clients will benefit enormously from the strategic insights, practical business solutions, and collaborations Brad Wall has formed over a stellar political career,” said a news release from national managing partner and chief executive Doug Bryce.

“Brad is well known at home and abroad for his advocacy of sustainable economic development, particularly in the energy and agri-food industries as well as for forging solutions to challenging issues that span politics, business and trade.”

Mr. Wall, 52, served as Saskatchewan’s premier for more than 10 years, retiring early this year with no set plans for what was to come next. But with his enduring popularity in conservative and energy circles, many expected his post-political career would lead to Calgary.

Born in Swift Current, Mr. Wall has similar roots to many of the movers and shakers in Alberta’s oil and gas sector – who also hail from the neighbouring Prairie province. His time in office benefited from a global commodities boom, and he is a vocal advocate for the building of new oil pipelines, and western industry sectors including oil and gas, potash and agriculture. He leveraged social media and his sometimes lonesome dissenting position on Canada’s climate policy – especially his opposition to national carbon tax – to become one of the country’s leading conservative voices.

Mr. Wall will be working closely with Osler’s national energy and regulatory practice under the leadership of partner Shawn Denstedt.

Mr. Denstedt led the Osler team that acted for Kinder Morgan Canada Ltd. in connection with its application to the National Energy Board for the expansion of the Trans Mountain pipeline, and the firm continues to do work for the pipeline company in advancing the controversial $7.4-billion project.

The firm has offices in Toronto, Montreal, Calgary, Ottawa, Vancouver and New York.

 

Sask. launches carbon tax challenge in court

Sask. launches carbon tax challenge in court

Sarah Mills
ckom.com
Sask. launches carbon tax challenge in court

Environment Minister Dustin Duncan, Premier Scott Moe and Justice Minister Don Morgan announce the court challenge against a federal carbon tax April 25, 2018. (Sarah Mills/980 CJME)

Saskatchewan’s fight against the federal carbon tax has advanced to the next round.

The government has launched a constitutional reference case in the Saskatchewan Court of Appeal to challenge the federal government’s ability to impose its tax on the province.

The government is asking the court to answer a clear question on the constitutionality of the legislation Ottawa has introduced to impose the The Greenhouse Gas Pollution Pricing Act. The carbon tax was introduced into Parliament on March 28, 2018 as Part 5 of Bill C-74.  The question before the court is, if enacted, will this act be unconstitutional in whole or in part?

“We do not believe the federal government has the constitutional right to impose the Trudeau carbon tax on Saskatchewan, against the wishes of the government and people of Saskatchewan,” Premier Scott Moe said.  “We have a made-in-Saskatchewan plan to reduce emissions and fight climate change, and that plan does not include a job-killing carbon tax on Saskatchewan families.”

Constitutional challenge over jurisdiction

Justice Minister Don Morgan said the government’s constitutional lawyers believe the federal carbon tax legislation can be successfully challenged because it imposes a carbon tax on some provinces but not others based on how each province has chosen to exercise its own legislative jurisdiction.

“This runs contrary to the principle of federalism, which is one of the bedrocks of our constitutional division of powers because it fails to respect the sovereignty and autonomy of the provinces with respect to matters under their jurisdiction,” Morgan said.  “Simply put, we do not believe the federal government has the right to impose a tax on one province but not others just because they don’t like our climate change plan.”

Under the constitution, each level of government is sovereign within its own legislative realm.  Provinces are not subsidiaries of the federal government.  Provincial governments have the authority to set policy in areas of provincial jurisdiction, and the federal government does not have the right to override that provincial authority.

Saskatchewan climate change strategy

The Government of Saskatchewan released Prairie Resilience: A Made-in-Saskatchewan Climate Change Strategy in December 2017.

The strategy includes the development of sector-specific output-based performance standards for large emitting facilities. Some of those standards involve: increasing efficiencies in buildings by adopting the 2015 National Building Code; creating a freight strategy to improve delivery times, reducing fuel and increasing efficiency; and developing a climate resiliency model to help ensure communities are able to adapt and mitigate against the effects of climate change.

“Our made-in-Saskatchewan climate change strategy is broader and bolder than a carbon tax,” Environment Minister Dustin Duncan said.

“Our plan to reduce emissions from the electricity sector by 40 per cent and methane emissions from the oil and gas sector by 40 to 45 per cent by 2030 shows we are serious about tackling climate change.  Our Saskatchewan story also includes our agriculture industry that sequesters nearly 12 million tonnes of CO2 annually and carbon capture at Boundary Dam 3 that has prevented two million tonnes of carbon dioxide from entering our atmosphere. Saskatchewan is the solution, not the problem.”

There have been some who have been critical of the Saskatchewan Party’s green plan, arguing that it chooses jobs over the environment and doesn’t prepare for any economic changes that may be brought about by a changing climate.

At one point, Saskatchewan’s former premier, Brad Wall, stood alone in his fight against carbon tax but the political climate has changed.

Manitoba is now holding off on introducing such a tax and is looking to launch a legal challenge of its own.

As well, looming elections in Ontario and Alberta may lead to a change in government and a change in the current political position on the carbon tax.

Petroleum producers support Alta., Sask. stance on oil fight

Petroleum producers support Alta., Sask. stance on oil fight

CJME News

Petroleum producers support Alta., Sask. stance on oil fight

The president of the Canadian Association of Petroleum Producers (CAPP) is frustrated the Alberta and Saskatchewan governments have had to resort to potentially blocking the flow of oil to B.C.

In an interview on Gormley Tuesday, CAPP president Tim McMillan maintained B.C. Premier John Hogan is holding Canada hostage as he faces pressure from the Green Party to block the Trans Mountain pipeline project.

McMillan applauds the stance the governments of Alberta and now Saskatchewan are prepared to take to pressure the B.C. government to allow the pipeline expansion to move ahead. But he also noted he hopes it doesn’t get to that point.

Alberta Premier Rachel Notley’s government introduced legislation on Monday that would give the province power to unilaterally reduce exports of oil and natural gas. Premier Scott Moe announced the Saskatchewan government would follow suit.

“We support very much the efforts of our Saskatchewan and Alberta premiers to force this question and force this issue,” McMillan commented.

McMillan said the industry already fights so hard to get market access and one of the tools they already use is to moderate the ability to ship oil to B.C.

“There’s some thoughtfulness to it, but it still is going to affect our industry and in the short term that’s going to hurt, but in the long-term that’s what we need is market access,” McMillan commented.

He said he hopes the issue with B.C. can be resolved before legislation to block oil is actually imposed.

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