
The complicated ethics of wildlife photography
Captivating photos can benefit animals by raising awareness for conservation issues, but there’s a thin...
A new paper put out yesterday by respected Canadian economist Robyn Allan, finds there is no existing data to back up the much-touted claim by CIBC energy analysts – and echoed by industry, government and major media outlets – that Canada is losing $50 million a day because it is selling tar sands crude "on the cheap."
In the paper, titled: Bitumen’s Deep Discount Deception And Canada’s Pipeline Mania: An Economic and Financial Analysis [PDF], Allan writes that the basis for the $50 million a day loss claim is a March 6, 2012 CIBC Institutional Equity Research Update published “Double Discounting of Canadian Crudes.” Google the phrase "double discounting Canada's crude" and "oil sands $50 million a day" and you will see how often these two phrases are being used to argue for further pipeline expansion in the form of the Keystone XL, Gateway and other proposed projects.
On Tuesday Joe Oliver, Canada's minister of natural resources, told reporters that:
"Because of a lack of pipeline capacity, Canadian oil is selling at a considerable discount to the international price. Some CAD $50 million every day is lost to the Canadian economy."
A Google search also shows that the CIBC report is not publicly available.
When Allan asked a CIBC analyst for the data backing the $50 million loss claim, the analyst told her, "I don't have that data anymore."
Without the data, Allan attempted to recreate the loss claim made by CIBC and concludes that, "on an annualized basis, and adjusting for natural differentials, we don’t need supply volumes to conclude there was no real loss posted to the oil industry for [synthetic crude oil] or for diluted bitumen as compared with [Western Texas Intermediate] in 2012."
In layman's terms Allan is saying the CIBC claim is incorrect and that in fact the $50 million figure is derived from a natural price differential that has always existed between the going market price for diluted tar sands bitumen (which Allan characterizes as "junk crude") and Western Texas Intermediate oil (WTI) which is a more valuable light crude oil.
Image Credit: Enbridge Northern Gateway Pipeline Brochure.
The Ontario government’s proposed Highway 413 would cut through not just one but three parcels of land set aside for conservation, according to an internal...
Continue readingCaptivating photos can benefit animals by raising awareness for conservation issues, but there’s a thin...
This story is part of Toronto’s Climate Right Now, a collaboration with The Local about vulnerability and adaptation...
Documents obtained by The Narwhal and the Toronto Star show Ontario has quietly confirmed the...