Canadian Insight

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Updated on Tuesday, November 13, 2018

Imperial Oil Ltd. about to begin construction of its Aspen Oilsands project — Nov. 7, 2018

Imperial Oil announced today that it will go ahead with its Aspen Oilsands project northeast of Fort McMurray. Construction will begin immediately and be completed by 2022.

The oil sands project is estimated to cost $2.6 billion and is expected to employ 700 jobs during the peak of its construction.

Imperial Oil stated that it will be employing new technology in its operations. It will use 25% less water in its operations compared to traditional steam assisted means.

The project when completed will produce  75,000 barrels of crude oil daily. It will have the capability to expand to double its initial production volumes.


National Energy Board releases schedule of Trans Mountain Expansion hearings and summation  — Oct. 15, 2018

National Energy Board released a hearing schedule  for Trans Mountain; this is as required by Federal authorities for its reconsideration of aspects of the Trans Mountain Expansion Project pertaining to project related marine shipping.

The hearings will start this month and end in December. Oral summary arguments will be presented in January, 2019. Complete process and issue resulting report will come no later than February 22, 2019.


British Columbia’s carbon tax squeezing the profitability out of natural gas in that province — October 11, 2018

Doug Suttles, CEO of EnCana  Corporation, stated that British Columbia’s carbon tax is costing his company $100,000 per each natural gas well drilled in that province. He went on to say that carbon taxes are making it unprofitable to compete with USA

Suttles went on to say that natural gas is a very clean fuel which produces very low carbon emission, and yet, it is not being credited for its benefits but instead taxed. Natural gas is used extensively to produce electricity worldwide.

Doug Suttles went on to conclude that Canada needs stronger voice in this country to steer the its direction in global energy leadership.


Federal government of Canada freezes all offshore Arctic oil and gas drilling and development— October 4, 2018

Minister of Intergovernmental and Northern Affairs and Internal Trade, Dominic LeBlanc,  announced Canada's next steps on future Arctic offshore oil and gas development for current licence holders. Government of Canada will freeze the terms of the existing licences in the Arctic offshore.

The federal government will work with Northern partners to co-develop the scope and governance framework for a science-based, life-cycle impact assessment review every five years that takes into account marine and climate change science.

LeBlanc stated that the federal government will negotiate a Beaufort Sea oil and gas co-management and revenue-sharing agreement with the governments of the Northwest Territories and Yukon, and the Inuvialuit Regional Corporation.

Two years ago, Prime Minister Justin Trudeau stated that his government would engage in a one-year consultation process with the current licence holders, and a moratorium on new oil and gas exploration licences in the Arctic, renewable every five years based on the best available science.


LNG Canada Project participants reach a final investment decision — October 2, 2018

Petronas and its five joint partners have reached a final investment decision on a major liquefied natural gas (LNG) project in Kitimat, British Columbia.

The LNG export facility includes the design, construction and operation of a natural gas liquefaction plant and facilities for the storage and export of LNG, including marine facilities. Included with the project is  a 670 kilometre pipeline delivering natural gas from the northeast corner of the province.

LNG Canada project will initially consist of two LNG liquefaction processing units with a total capacity of approximately 14 million tonnes per year.  The project has the potential to expand to four times the initial production capacity. The total project is appraised to cost $40 billion.

Eagle Spirit Energy Holdings waiting and willing to construct a northern route pipeline — Sept. 27, 2018

An all indigenous group of investors, Eagle Spirit Energy Holdings, wants the federal government to withdraw legislation which would prohibit oil tankers from using the northern B.C. coastal route.

Eagle Spirit Energy stated that it has a plan to construct a  quadruple 48 inch pipeline from Alberta through northern British Columbia. Two of the pipelines would carry crude oil and the other two would transport natural gas to the west coast.

The leader of the investment group, Calvin Helin stated that the proposed pipeline would be far more advantageous and far more environmentally friendly than the failed Northern Gateway  Pipeline, as the proposed pipeline would not carry any condensate.

Helin went on to conclude that shipping crude oil through Prince Rupert is a safer route and National Energy Board would more likely give approval to. This project would benefit and encourage development of Canada’s natural gas, LNG industry and Alberta’s oil sands.


Teck Resources planning a $20.6 billion oil sands mining operation in northern Alberta — Sept. 25, 2018

Public hearings have begun for a proposed oil sands operation near Fort McMurray, in northeastern Alberta. Vancouver based Teck Resources Limited wants to construct a $20.6 billion bitumen mining operation.

The megaproject would be built in two phases. In the first phase, operations would produce 170,000 barrels of crude oil per day. In the next phase, an additional 90,000 barrels of crude oil would be added.

Teck Resources wants construction to start while the industry is still in a slowdown and costs remain low. Teck intends to have the first phase in operation by 2026.


Government orders NEB to reconsider recommendations for Trans Mountain Pipeline approval — Sept. 21, 2018

Federal Natural Resources Minister Amarjeet Sohi that he has ordered the National Energy Board to reconsider its recommendations and take into the account the effects of  project related marine shipping.

Honorable Amarjeet Sohi stated, "Today, we have instructed the National Energy Board to reconsider its recommendations, taking into account the effects of project-related marine shipping. The NEB will be required to complete a thorough and prompt review and deliver its report within 22 weeks."

He went on to conclude, “"Today's announcement represents one important step towards addressing issues raised by the Federal Court of Appeal while continuing to deliver the highest levels of marine protection that Canadians expect."

Consortium planning a new refinery in Alberta — Sept. 17, 2018

A consortium led by China’s Sinopec Corporation is planning construction of a new refinery in northern Alberta. The refinery would be situated near sourced bitumen and process 167,000 barrels of crude oil per day. Estimated cost of the project is $8.5 billion dollars.

Sinopec, a group of indigenous investors, China State Construction Engineering Corporation and Alberta’s management company, Teedrum, are all involved in initial planning stages and will be submitting their proposals to the federal and provincial governments. Expectations are that an approval will be given in two years.

Heavily discounted crude oil and large dependable sources of bitumen are only some of the factors that drew the consortium to the region to plan construction of a new refinery.

Once the refinery is completed, China will import refined petroleum products. It is likely that these products may be moved by rail to a west coast loading terminal.

A previous proposal in 2012, headed by indigenous group, was denied approval by the Alberta government. It was then stated that it was economically unfeasible. Since then, the abandonment of proposed pipelines and discounted Canadian crude oil, have all changed the economics of the initial and the new proposal.




Our most recent ‘Shouts & Toots’  from the Oil Patch  — November 13, 2018

Frontera Energy Corporation (FEC:TSX) announced on November 13th that it commenced a consent solicitation with respect to proposed amendments to the indenture governing its outstanding U.S.$350 million 9.700% Senior Notes due 2023, upon the terms and subject to the conditions set forth in a Consent Solicitation Statement, dated November 13, 2018.

Company is soliciting consents from holders of record of Notes as of 5:00 p.m. (New York city time) on November 12, 2018 to certain proposed amendments to the indenture governing the Notes.

Company is seeking the Proposed Amendments to give the company flexibility to use existing cash resources and expected future cash resources to implement measures expected to enhance shareholder value. These measures may include accelerating or increasing share buyback programs, dividend payments and Investments.

Frontera Energy Corp is a Toronto based oil and gas company. It explores, develops and produces crude oil and natural gas in Colombia and Peru. Company has a market cap of $1.6 billion and approximately 100 million shares outstanding.

Petro Vista Energy Corp. (FEC:TSX) announced on November 13th that it has entered into a definitive agreement dated November 9, 2018 with 3 Sixty Secure Corp., a privately held corporation. resulting from the prior amalgamation of 3Sixty and Total Cannabis Security Solutions Inc.

Prior to completion, Petro Vista will consolidate all of its issued and outstanding common shares on the basis of one post-consolidation Petro Vista Share for every two pre-consolidation Petro Vista Shares.

On November 29, 2018, Petro Vista will be holding a special meeting of Petro Vista Shareholders, at which Petro Vista Shareholders will be asked to consider and, if deemed advisable, approve, certain resolutions in respect of the RTO transaction.

Petro Vista Shares will remain halted from trading and, subject to the delisting of the Petro Vista Shares from the TSXV and the proposed listing of the Resulting Issuer Shares on the Canadian Securities Exchange, the shares are not expected to resume trading until after completion of the transaction.

Petrovista is a Vancouver based company. Company has a market cap of $1.18 million and approximately 5.2 million shares outstanding.

Tidewater Midstream and Infrastructure Ltd. (TWM:TSX) announced on November 13th that it has filed its condensed interim consolidated financial statements and Management's Discussion and Analysis for the three-month period ended September 30, 2018.

Company reported a revenue of $80 million in the third quarter and $233.5 million in the first nine months of 2018. Company has a net loss of $(1.45) million in the third quarter and a net income of $6.1 million in the first nine months of 2018.

Tidewater continues to position itself to provide producers additional egress solutions and improved pricing for their products in a challenging commodity price environment by developing and connecting its infrastructure in order to access additional end markets.

Tidewater Midstream and Infrastructure Ltd based in Calgary and engaged in providing midstream infrastructure and a natural gas storage facility. Company has a market cap of $454 million and approximately 329 million shares outstanding.

Valeura Energy Inc. (VLE:TSX) announced on November 13th its financial and operating results for Q3 2018 and provide an update on its continuing appraisal program. Company reported a sales revenue of $2.4 million and a net loss of $(2.6) million in the third quarter of 2018.

Company's unconventional Basin Centered Gas Accumulation discovery in Turkey has been evaluated by DeGolyer and MacNaughton to hold 10.1 Tcf of estimated working interest unrisked mean prospective resources of natural gas, which includes 236 MMbbl of condensate.

During the quarter, the Company prepared the Inanli-1 wellsite approximately 6 km to the north east of the Yamalik-1 location, imported drilling and service equipment including the KCA Deutag T-700 drilling rig, and commenced drilling on October 8, 2018. Drilling operations to date are proceeding safely, on budget and on schedule.

Valeura Energy Inc is a Calgary based company engaged in the exploration, development, and production of petroleum and natural gas in Turkey. Company has a market cap of $300 million and approximately 86 million shares outstanding.

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BNK Petroleum Inc. (BKX:TSX) announced its third quarter report. Funds from operations increased by 107% to $3.4 million in the third quarter 2018 compared to $1.7 million in the third quarter of 2017. Company had a positive net income for the third quarter of 2018 of $1.2 million compared to a net loss of $1.3 million for the third quarter of 2017 due to unrealized losses of $0.2 million from hedged commodity contracts in the third quarter of 2018 compared to an unrealized loss of $1.3 million in the third quarter of 2017.

Average production for the third quarter of 2018 increased by 40% to 1,534 BOEPD, compared to third quarter 2017 average production of 1,097 BOEPD. The increase was primarily due to the Glenn 16-2H and WLC 14-1H wells that were part of the Company's 2018 drilling program as well as two wells that came into production in the last few months of 2017 partially offset by 77 BOEPD of prior period adjustments.

BNK Petroleum Inc is US based company engaged in the acquisition, exploration, and production of oil and gas reserves. Company has a market cap of $82 million and approximately 233 million shares outstanding.

Cathedral Energy Services Ltd. (CET:TSX) announced on November 9th its consolidated financial results for the three and nine months ended September 30, 2018. Company reported a revenue of $42.6 million in the third quarter and a revenue of $118 million in the first nine months of 2018. Company had a net income of $3 million in the third quarter and $797,000 for the nine months of 2018.

Company continues to make investments in equipment to relieve capacity constraints and to improve equipment utilization, reliability and performance. Substantially all of these expenditures are targeted at the U.S. market. Through having additional equipment to deploy into 2019 and company's continued focus on technology and its capabilities to improve drilling performance Cathedral is confident to be well positioned for the remainder of 2018 and into 2019.

Cathedral Energy Services Ltd is a Calgary based Canadian company engaged in the business of providing selected oilfield services to oil and natural gas companies in western Canada and selected basins in the U.S. Company has a market cap of 39 million and approximately 50 million shares outstanding.

Eagle Energy Inc. (EGL:TSX) announced on November 9th its financial and operating results for the third quarter ended September 30, 2018. Company reported a revenue of $9 million in the third quarter and a loss of $(1.9) million in the same quarter.

During the quarter, Eagle drilled and cased a third horizontal well in North Texas at a location approximately one mile from its initial horizontal well.

Eagle is a Calgary based company with assets and operations in US. And some properties in Alberta. Company has a market cap of $8 million and approximately 44 million shares outstanding.

Paramount Resources Ltd. (POU:TSX) announced its third quarter results. Company reported petroleum sales revenue were 248.5 million and a net loss $(23.4) million in the third quarter of 2018.

Company completed an extensive maintenance program in the third quarter in the Kaybob and Central Alberta and Other regions, including processing facility turnarounds, compressor overhauls and equipment upgrades. Where possible, this work was scheduled to align with facility outages.

Sales volumes averaged 80,471 Boe/d in the third quarter of 2018, including 29,831 Bbl/d or 37 percent liquids. Production was impacted by scheduled turnarounds at a third-party facility in Karr and Paramount's 8-9 facility in Kaybob, as well as the Resthaven/Jayar sale.

Paramount Resources is a Calgary based oil and gas company with assets and operations in Alberta and British Columbia. Company has a market cap of $1.0 billion and approximately 131 million shares outstanding.             

More news on Oilpatch Review


Today’s Inspirations

“Good , better, best: never let it rest till your good is better and your better is best.”

Quotes are directly taken from a book entitled, ‘Phrase A Day Inspirations’, written by Bernie Shimko. ‘Canadian Insight’ wishes to thank Bernie and his wife Adeline for permitting the use of their inspiring quotes.

Did you know?


The U.S. Energy Information Administration has predicted that Brazil will become the fourth largest energy producer in the world by 2035. Its basing its prediction on current offshore oil development coupled with its rapid ethanol expansion.


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 Price Spread $44.00

  November 13, 2018

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