They stress the unknown future production levels from U.S. oil fracking as important for determining the future size of Canada’s oil industry.
They mention this Jeff Rubin report: Evaluating the Need for Pipelines: A False Narrative for the Canadian Economy
Abstract:
The claim that additional pipeline capacity to tidewater will unlock significantly higher prices for bitumen is not corroborated by either past or current market conditions. Recent international commitments to reduce global carbon emissions over the next three decades will significantly reduce the size of future oil markets. Only the lowest-cost producers will remain commercially viable while high-cost producers will be forced to exit the market. The National Energy Board should consider a rapidly decarbonizing global economy when assessing the need and commercial viability of further pipelines in the country and use Western Canadian Select as the price benchmark when evaluating the economic viability of any new oil sands projects. Pension plans need to stress test their long-term investments in the oil sands in the context of a decarbonizing global economy.
Related:
Why Your World Is About to Get a Whole Lot Smaller
Export industries, shipping, and the price of oil
Is there an alternative to extracting the bitumen sands?
Justin Trudeau’s depressing perspective on the oil sands
‘Shut down the oil sands’ is not an extreme position
Two things Canada’s oil industry needs to understand
Canada should phase-out fossil fuel exports
The oil sands can’t be sustainable
The magnitude of GHG emissions from the oil sands
Canada does not have the right to develop the oil sands
‘In the lion’s den’: Trudeau defends oilsands statements at Calgary town hall
‘We have to manage the transition off fossil fuels,’ PM says, even invoking his predecessor’s name
A former Liberal environment minister is urging Prime Minister Justin Trudeau’s cabinet to reject the Trans Mountain pipeline expansion, arguing there is no economic basis for the project.
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His letter doesn’t focus on the climate and environmental impacts of the expansion. Instead, he took aim at the economic argument for the project, which he described as the “perceived need for a pipeline connection with tidewater in order to sell Alberta bitumen in Asian markets, where, so it is claimed, it would find new purchasers.”
Anderson wrote that Asian refineries have better supply options than Alberta. Compared with conventional light and medium crude oil from Nigeria and the Middle East, Alberta bitumen is expensive to produce, hard to handle and provides no security of supply advantages, he said.
Further, he said despite access to tidewater through unused pipeline capacity in the existing system and through American Gulf of Mexico ports, Alberta’s bitumen has not found or developed any significant offshore market in Asia or anywhere else.
Canada’s two major competitors are Venezuela and Mexico and they’ve faced the same low demand and low prices that have eroded the value of Alberta bitumen, he added.