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Oil Patch and Alberta
- Thread starter Mad Mike
- Start date
Mad Mike
Well-known member
Sadly I think you're going to see economic refugees fleeing Alberta soon. The price of oil might recover... but then it may not. Demand will be low for a while, vehicle electrification is slowly chipping away at fossil fuel use, and good luck with that pipeline.
Kinda sad. Alberta could have been the Norway of Canada. Since 1990 Norway has pumped about 1/2 the oil that Alberta has pumped -- Norway has grown their "heritage fund" equivalent for $1 trillion (1,000 billion), where Alberta sits at about $18 billion.
Alberta has managed their public purse with the same discipline as an oil patch worker at a saloon during his week off.
Kinda sad. Alberta could have been the Norway of Canada. Since 1990 Norway has pumped about 1/2 the oil that Alberta has pumped -- Norway has grown their "heritage fund" equivalent for $1 trillion (1,000 billion), where Alberta sits at about $18 billion.
Alberta has managed their public purse with the same discipline as an oil patch worker at a saloon during his week off.
J_F
Guest
^ yeah wasn't there a guy in the 70's
proposed something like what Norway ended up doing?
Alberta gave that precious resource away to the OilCo's for nothing
not trying to add insult to injury
but there's an entitlement problem up there
high school educated and lower pulling in executive salaries
Canadians from other regions have had to move or work away from home for decades
poor old Newfs were fished out of their livelihoods and had to hit the road
plenty of displaced Ontarians have had to hit the road
I did it for 15 years, never bitching, it's what a person with responsibilities does
proposed something like what Norway ended up doing?
Alberta gave that precious resource away to the OilCo's for nothing
not trying to add insult to injury
but there's an entitlement problem up there
high school educated and lower pulling in executive salaries
Canadians from other regions have had to move or work away from home for decades
poor old Newfs were fished out of their livelihoods and had to hit the road
plenty of displaced Ontarians have had to hit the road
I did it for 15 years, never bitching, it's what a person with responsibilities does
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Seeing predictions of oil going negative having to pay to take it away time for someone to bomb Saudi Arabia.
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Sent from my moto g(7) plus using Tapatalk
I predict some of the companies in the patch know if they seriously mothball all of it, a lot of it will NEVER reopen in the next two decades. All the sub contractors and 'agencies' will go, and thousands of support jobs in Edmonton and Calgary, but I suspect a few corners of the patch will live on. A mere shadow of thier former self.
I have two kids up there, one directly involved and one just employed in Ft Mac. Its ugly.
I have two kids up there, one directly involved and one just employed in Ft Mac. Its ugly.
Seems that province is all boom and bust...and when it's in a boom they don't save 2 dimes for the bust.
I have a relative out there who was working in the patch and making money hand over fist. 5 years ago he's posting pictures all over facebook of a $75K lifted truck in his driveway next to the ski boat...garage with a bunch of motorcycles and jetskis, 75" bigscreen in the garage, hot tub and pool....not to mention the palace of a house.
Now....not so much.
I'd have banked all that money and lived in a freakin' motorhome somewhere knowing damned well that a bust was inevitable. When it hits....start up the motorhome and move on to where the next opportunity presents itself.
But that province never seems to look further ahead than the next sunrise.
I have a relative out there who was working in the patch and making money hand over fist. 5 years ago he's posting pictures all over facebook of a $75K lifted truck in his driveway next to the ski boat...garage with a bunch of motorcycles and jetskis, 75" bigscreen in the garage, hot tub and pool....not to mention the palace of a house.
Now....not so much.
I'd have banked all that money and lived in a freakin' motorhome somewhere knowing damned well that a bust was inevitable. When it hits....start up the motorhome and move on to where the next opportunity presents itself.
But that province never seems to look further ahead than the next sunrise.
Yup, and the bust will wipe out pretty much any house value in places like Ft Mac. When (or if) it fires up again, I could see Ft Mac being an industry town with the houses owned by the companies (like northern reserves).
Mad Mike
Well-known member
Or they could just set the town on fire and leave it to mother nature.
I wonder....if it would be cost efficient to set up refining and raw material manufacturing plants directly on the oil fields. Ie refine the crude bitumen then use the oil as feedstock for plastics etc in-place? Would the transport savings offset the low oil price? So instead of being an oil supplier, Alberta becomes a plastics and materials supplier? Especially if they look at the manufacture of valuable materials like elaborate polymers?
J_F
Guest
a couple of the larger outfits up there are performing locally what's called upgrading
a process that takes the heavy bitumen and turns it into synthetic crude oil
it is a very expensive process but they end up with a much preferable commodity to diluted bitumen
the outfits that can't upgrade produce dilbit, bitumen diluted with naptha and other solvents
it is really low grade crap and also dangerous as heck to transport - see Lake Magentic rail disaster
I can see the streamlined outfits that do their own upgrading surviving
the other outfits probably not, we just don't need all that dirty oil
there's sufficient pipeline capacity out of the patch down to the refineries in Edmonton and Hardesty
the bottleneck is beyond there for further refining to regional fuel and oil production
that is an interesting idea JC, specialize in value added petroleum products
those industries could have a good go in Edmonton near the existing refinery industry
and a workforce already in place that doesn't need massive temporary infrastructure
and value added petroleum products don't have to go through a pipeline
the Ft. Mac boom/bust may finally be on it's last bust
it's the mining of the bitumen that's so labour intensive
I can't see a future where we need to dig up millions of hectares to get at worthless bitumen
a process that takes the heavy bitumen and turns it into synthetic crude oil
it is a very expensive process but they end up with a much preferable commodity to diluted bitumen
the outfits that can't upgrade produce dilbit, bitumen diluted with naptha and other solvents
it is really low grade crap and also dangerous as heck to transport - see Lake Magentic rail disaster
I can see the streamlined outfits that do their own upgrading surviving
the other outfits probably not, we just don't need all that dirty oil
there's sufficient pipeline capacity out of the patch down to the refineries in Edmonton and Hardesty
the bottleneck is beyond there for further refining to regional fuel and oil production
that is an interesting idea JC, specialize in value added petroleum products
those industries could have a good go in Edmonton near the existing refinery industry
and a workforce already in place that doesn't need massive temporary infrastructure
and value added petroleum products don't have to go through a pipeline
the Ft. Mac boom/bust may finally be on it's last bust
it's the mining of the bitumen that's so labour intensive
I can't see a future where we need to dig up millions of hectares to get at worthless bitumen
Mad Mike
Well-known member
That was the primary goal of the Heritage Fund. Alberta has neither the political or business braintrust to pull that off. They just blew the money.
They got started by building some capabilities in universities however that never really panned out - they failed to diversify enough to provide a steady stream of people capable of diversifying and building satellite industries. If they had invested the funds as they were supposed to, they would be somewhere between Alaska (100 billion) and Norway (1 trillion).
The fund had/has no protections in place, each incoming gov't looks at it like a treasure chest for funding election promises. Basically it's been squandered -- there is nothing left of the rainy day fund and no near term chance to revive it.
Alberta spent tomorrow's paycheque yesterday.
J_F
Guest
Kenney is in full panic mode
deemed oil patch workers essential - that won't change a thing
can't create demand, the Oil Co's will lay them off anyway
blaming everyone, Trudeau, Saudi Arabia, Russia
everyone but himself and previous governments
royalties been cut to nothing - no revenue coming in
Kenney wants pipelines!
to where? no one wants/needs that oil
again, a pipeline doesn't create demand
Trudeau's reply:
"We are focused on helping those Canadians, helping people who are hardest hit by economically by COVID-19.
The measures we've put in place will support Canadians right across the country including in our oil and gas sector."
JT is talking about EI
oil patch dudes can't keep up the payments on the crew cab
the Harley, the Skidoo and the $900,000 house on 2K/month
Alberta is screwed
deemed oil patch workers essential - that won't change a thing
can't create demand, the Oil Co's will lay them off anyway
blaming everyone, Trudeau, Saudi Arabia, Russia
everyone but himself and previous governments
royalties been cut to nothing - no revenue coming in
Kenney wants pipelines!
to where? no one wants/needs that oil
again, a pipeline doesn't create demand
Trudeau's reply:
"We are focused on helping those Canadians, helping people who are hardest hit by economically by COVID-19.
The measures we've put in place will support Canadians right across the country including in our oil and gas sector."
JT is talking about EI
oil patch dudes can't keep up the payments on the crew cab
the Harley, the Skidoo and the $900,000 house on 2K/month
Alberta is screwed
Hard to feel sorry for them. I remember years back I would read stories about how they were laughing at all the "idiots" who went to university etc when they were making double or triple the money with only a high school diploma.
Anyone with a shred of intelligence should have realized the gravy train wasnt going to last forever and would have banked away much of that money.
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