Saskatchewan’s mining sector meets the supply-chain face-to-face

10th Annual Saskatchewan Mining Supply Chain Forum

LinkedIn Item

CAPP Economic Report Series: A Global Vision for the Future of Canadian Oil and Natural Gas

CAPP Economic Report Series: A Global Vision for the Future of Canadian Oil and Natural Gas

drilloing pipe oil

I am pleased to provide you with a link to A Global Vision for the Future of Canadian Oil and Natural Gas, the first in a series of economic reports to be released by CAPP throughout 2018.

This report looks ahead at a carbon-constrained future in which Canadian oil and natural gas can thrive under the right conditions. It addresses significant issues facing industry today such as competitiveness, market access, climate and innovation, and benefits to all Canadians and our Indigenous peoples.

There is a place for Canadian oil and natural gas in the future global energy mix but only if industry and government work together to strike a balance between environmental stewardship, energy security, and prosperity for all Canadians.

The key issues addressed in our report include:

  • The Future Energy Mix – Canada’s role to help meet the future global energy demand as the world’s population grows to 9.8 billion people by 2050.  While renewable energy will play a larger role in the future energy mix, oil and natural gas will continue to account for 52 per cent of total energy demand.
  • Climate Leadership and Innovation – Innovation and the adoption of cost-effective clean technology will ensure the future of sustainable development of Canadian oil and natural gas.
  • Market Access – There is an opportunity to supply the world with Canadian oil and natural gas but without access to emerging markets, a streamlined regulatory system, and a competitive tax structure we risk losing capital to competing jurisdictions.
  • Benefits – All Canadians benefit from a healthy and robust oil and natural gas industry. In 2015 the energy sector contributed more than $160 billion to the country’s gross domestic product, and nationally created more than 640,000 jobs, and invested $3.3 billion in 396 Indigenous businesses in 66 communities.
  • Competitiveness – Competition for global capital investment is strong in other jurisdictions such as the United States, and competes with Canada for the same traditional markets. Although the U.S. is Canada’s largest customer, it has now become our largest competitor.

 

Canada is poised to become one of the world’s most sustainable energy suppliers at a time when environmental stewardship and responsible development are needed the most. In order for our oil and natural gas to be part of the global future energy mix, we must urgently address the challenges facing industry today.

To be balanced Alberta should have completely blocked BC wine from passing through it

do not pass go

To be balanced, Alberta should not have just blocked the sale of BC wines in Alberta; Alberta should have blocked all BC wine from passing through it to other provinces.

This would have stopped the flow of BC wine to the rest of Canada – a major market.

And, this should have been done on the grounds of, “Wine contributes to drunk driving, alcoholism, and the like.”

This is what BC is doing to Alberta and Saskatchewan.

By blocking pipelines, BC is stopping Albert and Saskatchewan oil from reaching major markets.

And by Alberta using the reason of “Wine contributes to drunk driving, alcoholism, and the like” – they would have a far better basis for the action.

Eric

SASKATCHEWAN PREMIER ANNOUNCES PST EXEMPTION ON AGRICULTURE, LIFE AND HEALTH INSURANCE

PREMIER ANNOUNCES PST EXEMPTION ON AGRICULTURE, LIFE AND HEALTH INSURANCE

Released on February 26, 2018

Government of Saskatchewan logo

Premier Scott Moe today fulfilled his commitment to reinstate the Provincial Sales Tax (PST) exemption for agriculture, life and health insurance premiums, effective today.

“Our government will help families and small businesses save money, invest and help our province grow,” Moe said.  “Part of that commitment is to exempt agriculture, life and health insurance from PST.”

The exemption covers agriculture, which includes crop, livestock and hail insurance premiums as well as individual and group life and health insurance premiums.  Health includes disability, accident and sickness insurance.

The exemption is retroactive to August 1, 2017, the date PST was applied to insurance.

The change has an impact of $65 million on revenue forecast for 2017-18 and a $120 million impact on revenue forecast for 2018-19.

Moe said the financial impact can be accommodated within the government’s three-year plan to balance the budget by 2019-20.

“Our fiscal plan remains on track, even with this reinstatement of the PST exemption on crop, life and health insurance,” Moe said.

The Ministry of Finance will work with the insurance industry to determine the best way to refund individuals and businesses that have paid PST on agriculture, life and health insurance premiums.  More information about how the refunds will be administered will be available by April 10.

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For more information, contact:

Karen Hill
Executive Council
Regina
Phone: 306-787-2127
Email: karen.hill@gov.sk.ca

Investors bail on trapped Canadian oil as pipeline woes deepen

Investors bail on trapped Canadian oil as pipeline woes deepen

Kinder Morgan pipe

Canada’s energy companies can’t get any love, even from many Canadians.

With pipeline, regulatory and political frustrations reaching new heights, the nation’s energy stocks slumped to their lowest level in almost two years this month. The iShares S&P/TSX Capped Energy Index ETF, which tracks Canadian energy companies, has seen about $56 million in outflows this year versus $32 million in inflows for an ETF focused on U.S. stocks. The pain has extended to the fixed-income market, with U.S. dollar high-yield bonds from Canadian energy issuers returning less than their global peers in the past 12 months.

At the heart of the sector’s woes is a dearth of pipeline capacity, which has depressed Canadian oil and natural gas prices. A new regulatory regime designed to speed up pipeline approvals is instead seen delaying projects while Alberta and British Columbia are fighting over one of the conduits the federal government has approved. On top of that, the industry is facing carbon taxes other jurisdictions don’t have to pay and it’s competing with American drillers which are seeing taxes cut under the Trump Administration.

“I’m not crazy about Canada,” Paul Tepsich, founder and portfolio manager at hedge fund High Rock Capital Management Inc. in Toronto, said by phone. “We’ve got taxes going up and regulations going up.”

Tepsich said he reduced the average exposure to Canadian energy equities in his clients’ to well under 3 percent from 8 percent a year ago. And while credit exposure remains relatively steady, he has no plans to add new holdings. He’s been adding to short-dated U.S. Treasuries amid market volatility and will look to selectively add U.S. energy names.

The big albatross for Canadian energy companies has been weak prices, caused by the pipeline pinch. Western Canadian Select, the main grade of oil extracted by Canadian oil-sands producers, is trading near the widest discount to West Texas Intermediate crude in almost four years. Alberta Energy Co. natural gas prices are also lagging their U.S. equivalent. WCS discounts would cost the Canadian economy about C$15.6 billion a year, or 0.75 percent of GDP, if maintained at current levels, Scotiabank Chief Economist Jean-Francois Perrault said in note.

The pipeline frustrations recently erupted into a trade war between oil-producing Alberta and neighboring British Columbia after the coastal province proposed limiting new shipments of oil-sands crude through its borders, possibly stalling a major expansion of the Kinder Morgan Inc. oil pipeline. Alberta Premier Rachel Notley banned imports of B.C. wine and abandoned talks to possibly buy more electricity from its neighbor.

Prime Minister Justin Trudeau’s government also announced earlier this month a plan to revamp the national energy regulator with a goal of giving the industry a speedier, more efficient approval process. But the plan also may include adding new types of projects that require federal approval and allows more input for some stakeholder groups, sparking industry fears it won’t become any easier.

Legal Challenges

The proposed legislation appears to effectively prevent any major new project from reaching any form of positive recommendation, the research team at GMP FirstEnergy, a major investment bank to the energy sector, said in a note. “A lack of hard timelines and a regulatory process that has been subject to dithering and near endless legal challenges will become the major stumbling block for domestic and international investor confidence in the Canadian energy sector.”

Federal Resources Minister Jim Carr said earlier this month the Liberal government has balanced government support for the energy industry with protecting the environment and receiving input from Canadians, noting C$500 billion in projects are planned over the next decade.

Banker and bondholder willingness to refinance debt and give companies time to boost output helped keep many struggling producers out of bankruptcy as oil prices slumped in recent years. Investor flight means it will be tougher for Canadian energy companies to access financing for capital-intensive projects. Suncor Energy Inc.’s $14 billion Fort Hills project, approved when WTI was $100 a barrel but started production last month, may be the last of a generation of mega Canadian oil-sands projects.

‘Zero Confidence’

“I’m inclined to believe that we don’t see another oil-sands project built,” Geof Marshall, the guardian of $40 billion of assets at CI Investments’ Signature Global Asset Management in Toronto, said by phone. The majority of his energy holdings are concentrated in U.S. regions like the Permian Basin, where there’s more capacity to move the commodity, he said.

Rafi Tahmazian, who helps manage about C$1 billion in energy investments at Canoe Financial in Calgary, said he began trimming holdings of Canadian energy equities after Justin Trudeau was elected in 2015. He started shifting further into the U.S. after Donald Trump became president and vowed to trim regulations and environmental protection.

Canada needs to cut taxes and ensure pipelines and LNG terminals get built, Tahmazian said.

“My job as an investor is to gauge and make investments based on my confidence in a leader of a company and a country, or a province or a state,” he said. “And I have zero confidence there right now.”

Scotiabank says pipeline constraints to cost economy $10.7 billion in 2018

Scotiabank says pipeline constraints to cost economy $10.7 billion in 2018

Saskatoon / 650 CKOM
Canadian Press

Scotiabank says pipeline constraints to cost economy $10.7 billion in 2018

Ian Bickis, The Canadian Press

CALGARY — Delayed oil pipeline construction is causing a steep discount for Canadian crude prices that is costing the economy roughly $15.6 billion a year or about 0.75 per cent of GDP, according to Scotiabank.

“Pipeline approval delays have imposed clear, demonstrable and substantial economic costs on the Canadian economy,” said bank chief economist Jean-Francois Perrault in a report Tuesday.

The discount, however, is expected to ease through the year as more rail capacity becomes available to ship oil, bringing the expected cost to roughly $10.7 billion or 0.5 per cent of GDP for 2018 and then $7 billion or 0.3 per cent of GDP a year until more pipeline capacity comes online.

The costs come as delays continue for all three major proposed oil pipelines to export more oil from Western Canada, including Kinder Morgan’s Trans Mountain expansion, Enbridge’s Line 3 replacement, and TransCanada’s Keystone XL.

Canadian producers would need Line 3 and at least one of the other pipelines to go forward or face indefinite pipeline constraints that would have an impact on Canada’s well-being with consequences that extend well beyond Alberta, said Perrault.

“The elevated discounts come with a steep economic cost, and represent to a large degree a self-inflicted wound,” he said.

The latest economic impacts of the pipeline constraints come as Alberta and British Columbia continue to quarrel over the construction of the Trans Mountain project, pitting arguments of economic impact against the importance of protecting coastlines and limiting greenhouse gas emissions.

The current squeeze in pipeline capacity has been expected for some time, but the leak and temporary shutdown on TransCanada’s Keystone pipeline last November sped up the problem, said Perrault.

The shutdown led to oil storage tanks in Alberta to fill to record volumes and sent the spread between Western Canadian and U.S. crude to more than US$30 a barrel, while the regulator-imposed 20 per cent reduced capacity on Keystone has continued to limit a recovery.

The discount on Western Canadian oil production since the spill has hovered around US$24 a barrel, much higher than the US$13 spread for the past two years, and Scotiabank expects it to average US$21.6 a barrel for 2018.

Western Canadian production is discounted somewhat both by quality and transportation costs, but has spiked several times in the past decade as pipeline space runs tight.

Saskatchewan Has Second Lowest Unemployment Rate in Canada

Second Lowest Unemployment Rate in Canada

Released on February 9, 2018

Saskatchewan’s unemployment rate was 5.4 per cent (seasonally adjusted) in January – tied for the second lowest rate among the provinces and below the national rate of 5.9 per cent according to Statistics Canada.

There were 560,100 people employed, 1,500 more jobs compared to January 2017, including an increase of 4,900 full-time jobs.

Employment in Saskatchewan was up 1,100 from the previous month (0.2 per cent), the highest percentage increase among the provinces (seasonally adjusted).  There were 6,200 full-time jobs created month-over-month.

“This is definitely a positive indicator that Saskatchewan’s economy is on the rebound,” Minister of Immigration and Career Training Jeremy Harrison said.  “With our unemployment rate being second lowest in the nation and employment up, in addition to recent good news on building permits and urban housing starts, 2018 is looking to be a good year for our province.”
Major year-over-year gains were reported for accommodation and food services up 2,300; public administration up 2,000; business, building and other support services up 1,700.

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For more information, contact:

Deb Young
Economy
Regina
Phone: 306-787-4765
Email: deb.young@gov.sk.ca

Saskatchewan oil-rights sales up 30%

TOTAL PUBLIC OFFERING REVENUE FOR 2017-18 FISCAL YEAR REACHES $65 MILLION

Released on February 8, 2018

Sustained interest in Saskatchewan’s southeast region generated the majority of revenue in the February public offering of Crown petroleum and natural gas rights on Tuesday, with the $3 million from that sale pushing the final total for the 2017-18 fiscal year to $65 million.

This total exceeds the previous fiscal year-end total of $50 million as industry activity and investment shows sustained signs of trending upward in the province.

“Saskatchewan is consistently a jurisdiction of choice for conventional producers looking for stability and solid returns,” Energy and Resources Minister Bronwyn Eyre said. “Increased drilling activity and industry investment indicate that one of our key economic sectors continues to gather momentum and stimulate growth in the province.”

Southeast Saskatchewan remained the focus of attention with 52 leases, consisting of 3,448.152 hectares, fetching $2,452,992.19. Spartan Energy Corp. bid $1,039,679.96 for 18 leases in southeast Saskatchewan totaling 1,295.206 hectares. One lease south of Carnduff received a bonus bid of $325,346.74 for 129.5 hectares. This lease was purchased by Spartan Energy Corp. and is prospective for oil in the Midale and Frobisher Beds of the Madison Group.

Saskatchewan’s oil and gas industry accounts for an estimated 15 per cent of the province’s total real Gross Domestic Product (GDP), and is the largest contributor among primary industries to provincial GDP.

In the Fraser Institute’s Annual Global Petroleum Survey for 2017, Saskatchewan ranked seventh out of 97 jurisdictions in the world in terms of overall attractiveness for oil and gas investment, and has consistently been among the top 10 jurisdictions over the past six iterations of the survey.

The next public offering of petroleum and natural gas rights will be held on April 10, 2018.

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For more information, contact:

Deb Young
ECON
Regina
Phone: 306-787-4765
Email: deb.young@gov.sk.ca

Shore Gold Inc. Announces Name Change to Star Diamond Corporation and New Trading Symbol

Shore Gold Inc. Announces Name Change to Star Diamond Corporation and New Trading Symbol

Shore Gold FALC aerial

Stock Symbol: SGF: TSX

SASKATOON, Feb. 8, 2018 /CNW/ – Kenneth E. MacNeill, President and CEO of Shore Gold Inc. (“Shore” or the “Corporation”) is pleased to announce that Shore has changed its name to Star Diamond Corporation. Effective at the start of trading on February 12, 2018, Star Diamond Corporation will also commence trading on the Toronto Stock Exchange under this new name and a new stock symbol “DIAM“.

This new corporate name is in honour of the Star Kimberlite, located in the Fort à la Corne forest of Saskatchewan, Canada. It was the exploration and evaluation work completed on the Star Kimberlite that demonstrated the significant quality, size and value of the contained diamond populations. These high value diamonds facilitated the consolidation and advancement of the Corporation’s Fort à la Corne area kimberlites, including the Star – Orion South Diamond Project.

The name change does not affect the rights of the Corporation’s shareholders. No further action is required by existing shareholders with respect to the name change, and certificates representing common shares of Shore Gold Inc. will not need to be surrendered or exchanged unless a transfer is being requested. Shareholders had previously approved a special resolution to allow an amendment to the Articles of the Corporation to change the name of the Corporation at the Corporation’s 2017 Annual and Special Meeting of Shareholders.

Following this name change, Shore’s domain name will change to www.stardiamondcorp.com and visitors to our current website address and communication to our current electronic mail addresses will be redirected.

On behalf of the Board,
Kenneth E. MacNeill
President and CEO

SOURCE Shore Gold Inc.

For further information:

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

This information is being distributed to you by / Cette information vous est transmise par : Shore Gold Inc.

300, 224-4th Ave. S., Saskatoon, SK., S7K 5M5
http://www.shoregold.com

Evraz responds to pipeline dispute between B.C. and Alberta

Evraz responds to pipeline dispute between B.C. and Alberta

CJME News

Evraz responds to pipeline dispute between B.C. and Alberta

Evraz North America, the company that operates Evraz Steel in Regina, is responding to the pipeline dispute between Alberta and British Columbia.

Alberta Premier Rachel Notely recently announced her province will be banning imports of wine from B.C.

This trade sanction is in retaliation to the B.C. government’s announcement of limiting the increase of diluted bitumen, which will effectively block the Trans Mountain Pipeline.

Now Evraz is weighing in on the issue because thousands of jobs in Canada rely on the expansion of the pipeline.

“(Evraz) was awarded a contract to produce approximately 275 thousand tons of pipe for this pipeline at our Regina, Sask. operations. The pipe is produced here in Canada by Canadians and uses Canadian raw materials,” said Conrad Winkler, president and CEO of Evraz North America, in a news release.

Evraz Steel began manufacturing pipe for the project in October 2017 after being awarded the contract by Trans Mountain. Manufacturing is to continue through May 2019.

“This project is real and we are building it with Canadian workers, materials and technology,” Winkler said in the release.

“Evraz North America operations in Canada employ over 2,000 people directly and generate between six and 10 times as many indirect jobs throughout the supply chain mainly across Western Canada. We are looking forward to a resolution to this impasse and to continuing production of the most technologically advanced, clean and safe steels for pipelines and oil country tubular goods right here in North America.”

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