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Updated on Thursday, August 16, 2018



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US District Court creates another setback for Keystone XL — Aug. 16, 2018

A federal judge in Montana ordered yesterday that the US State Department do another environmental review of the revised pipeline route. This judicial move will stall and delay the project once again.

The Keystone XL pipeline was proposed over a decade ago and has seen a whole variety of blockades — from President Obama’s stance stopping the project, to legal blocks and challenges set by land owners and environmentalist along the proposed route.

The election of President Trump and the full support of Congress seemed like a sure bet that the $8 billion  project would go ahead.

There has been no announcements made by TransCanada or the US State Department on the court decision.

Prior to this court decision, TransCanada Corporation had stated that it would begin construction of the pipeline in the second quarter of 2019.

 

Closure of Trans Mountain Pipeline deal slated for end of this year — Aug. 9, 2018

Canada Morgan Kinder announced that it expects the deal to sell its Trans Mountain Pipeline to the Canadian government to close in the last quarter of 2018.

Kinder Morgan shareholders will vote on the deal at their scheduled August 30, 2018 meeting. Expectations are that shareholders will approve the takeover.

The Canadian government announced on May 30, 2018 that it would buyout the Trans Mountain pipeline for $4.5 billion. Trans Mountain expansion would be covered under a credit faculty of the deal.

The federal purchase will still have another hurdle to clear. The American government must approve the Canadian government takeover of the pipeline.

 

Study shows carbon market is chasing away jobs at a big cost — June 13, 2018

Montreal Economic Institute has conducted an extensive study on government attempts to lower carbon emissions. The report concludes that there has been no impact on lowering greenhouse gases and that only jobs have been lost.

The study looked at three major areas where governments took action to reduce the use of hydrocarbons. The provinces of Ontario and Quebec were the focus on in Canada while the state of California was looked at in the US.

The study concluded that regardless of the amount hydrocarbons were taxed, the effect was insignificant  in reducing greenhouse gases. Demand and use of hydrocarbons remained the same. Higher prices on hydrocarbons only drove away jobs as employers attempted to cut costs.

Germain Belzile, author of the report states, "If the goal of the governments of Quebec and Ontario is to address the problems caused by climate change, then they should take a global approach. If such an approach, or one that at least encompasses North America, is not feasible, we should just put our trust in technological progress and innovation. We would reach our objectives just as quickly, and there would be a lot less waste.”

Joint Review Panel to study a proposed new oil sands project — June 7, 2018

Teck Resources Limited has submitted a proposal to the National Energy Board for construction of a 260,000 barrels per day oil sands mining operation near Fort McMurray.  

The proposal, “Frontier Oil Sands Mine Project”, will be reviewed by the Joint Review Panel whether Teck Resources has submitted enough information to hold public hearings.

If information submitted is adequate, the Joint Review Panel may begin public hearings as early as this coming September.  Submissions will be accepted from those concerned to hold hearings at specific locations.

Hearings will be open to the public and can be observed through a live webcast during the proceedings.

PETRONAS enters into agreement to purchase part ownership — May 31, 2018

PETRONAS has announced that its wholly owned entity, the North Montney LNG Limited Partnership, has entered into a Purchase and Sales Agreement for an equity position in the LNG Canada project in Kitimat, British Columbia.

Pending upon regulatory approval, PETRONAS will take a 25% ownership in the LNG project. No disclosure was made as to the purchase price but several reliable sources have stated that PETRONAS is willing to invest up to $31 billion in the project. The transaction is expected to be completed in several months.

 PETRONAS President and Group Chief Executive Officer Tan Sri Wan Zulkiflee Wan Ariffin commented, ""PETRONAS is pleased to be part of the LNG Canada project. As one of the world's largest LNG producers, PETRONAS looks forward to adding value to this venture through our long-term expertise and experience across the LNG value chain. We are committed to deliver LNG and natural gas, the cleanest fossil fuel in the world, to the growing global energy market."

PETRONAS is a Malaysian oil and gas company founded in 1974. Petronas has grown to be an integrated international oil and gas company with business interests in 35 countries. It is engaged in a wide spectrum of petroleum activities, including upstream exploration and production of oil and gas to downstream oil refining, marketing and distribution of petroleum products.

Federal government buys out Trans Mountain expansion project— May 29, 2018

Kinder Morgan announced that its has sold its Trans Mountain pipeline project for $4.5 billion to the Canadian government.

The pipeline expansion project will now become a crown corporation and Kinder Morgan will immediately continue with construction while its board seeks a third party buyer within the next several months. Alberta’s Premier Knotely has already voiced that provinces interest in part ownership.

Kinder Morgan will continue to operate its strategic infrastructure assets which includes the pipeline which has already been in service, the storage and all loading facilities in Edmonton and Vancouver

Federal Energy Minister Jim Carr stated that government has decided to temporarily take ownership of the project to assure that the project will be completed.

Alternate northern Canadian oil pipeline in the works — May 7, 2018

CEO of a private Indigenous company announced last week that the company is working on a plan to construct a northern pipeline from Fort McMurray to the northern Pacific coast.

Calvin Helin, CEO of Eagle Spirit Energy, and his company believes that they have a better pipeline alternative. He feels that it will be more acceptable to the public and the northern land owners.

The private Indigenous company has studied the route for over five years. Pending the outcome and the challenges to Bill C-48, the pipeline could be built through northern British Columbia to the coast near Grassy Point , or take the route from Fort McMurray into the Yukon and then in through Alaska.

Helin went on to explain why their plan has two different routes. The federal Liberal government may set a road block with new legislation dealing with the northern BC coastal waters.

Bill C-48 was introduced last year by federal Liberal government of Justin Trudeau and is in the final reading this week. If passed, it could stop all oil tanker traffic through the northern west coast of British Columbia..

Calvin Helin stated that an Indigenous group is ready to challenge Bill C-48 in B.C.’s Supreme Court should it pass and become law. He stated that the federal government did not consult with northern British Columbia’s Indigenous  people.

Should all legal challenges and avenues fail, his company already has an alternate route planned. Eagle Spirit Energy has signed a memorandum with land owners across the route in the northern US state.

Helin stated that landowners in Alaska and the town of Hyder are very receptive to the construction of the pipeline and the establishment of an oil tanker terminal near Hyder, Alaska..

When asked about how the pipeline and tanker terminal would be financed, Calvin Helin replied that his company is backed by a financial investment group in Vancouver and it is welling to spend up to$16 billion on the 1600  kilometer pipeline project and terminal.

 

Our most recent ‘Shouts & Toots’  from the Oil Patch  — August 16, 2018

AKITA Drilling Ltd. (AKT.A:TSX) and Xtreme Drilling Corp. (XDC:TSX) announced jointly that they received the approval of the Court of Queen's Bench of Alberta for the previously announced plan of arrangement under the Business Corporations Act (Alberta) pursuant to which AKITA will acquire all of the issued and outstanding common shares of Xtreme.

At the Xtreme special meeting of shareholders held on August 13, 2018, the Arrangement was approved by 99.87% of the votes cast by Xtreme shareholders who voted on the Arrangement. The arrangement is expected to occur in the third quarter of 2018.

AKITA is a Calgary based company engaged in the contract drilling business in Western Canada, the North, and the Permian Basin. Company has a market cap of $89.6 million and approximately 16 million shares outstanding.

Alvopetro Energy Ltd. ( ALV:TSX) announced an operational update and our second quarter financial and operating results. Company reported a net loss of $1.1 million in the second quarter due to negative funds flow from operations of $0.8 million and impairment charges of $0.2 million recognized in the quarter. Company relinquished Block 106 subsequent to June 30, 2018 and recognized an impairment of $0.2 million in the quarter to reduce the carrying value of the block to $nil. E&E expense in the quarter was primarily attributable to the remaining work commitment outstanding on this block.

Company's production increased to 33 bopd in the second quarter, a 57% increase from the first quarter 2018, largely due to increased production from our Bom Lugar well. As a result of increased sales volumes, rising commodity prices and reduced production expenses, company achieved an operating netback of $4.28 per barrel in the quarter.

Over the past four months company has made considerable progress in the development of our strategic natural gas assets in Bahia State in Brazil. Company finalized the terms of the unitization agreement for our Caburé natural gas field with the adjacent resource owner and have agreed to a development plan which will be executed in 2018 and 2019.

Alvopetro Energy is a Calgary based international oil and gas company. It is an independent upstream and midstream operator in Brazil. Company has a market cap of $38 million and approximately 85 million shares outstanding.

Strategic Oil & Gas Ltd. ( SOG:TSXV) announced on August 16th its financial and operating results for the three and six months ended June 30, 2018. Revenues increased 3% from the second quarter of 2017 to $10.6 million for the period due an increase in realized oil prices. Despite higher revenues, funds from operations decreased to $nil for the quarter from $3.0 million for the three months ended June 30, 2017 and $1.6 million for the first quarter of 2018.

Average production decreased 20% from the second quarter of 2017 to 2,138 boe/d for the second quarter of 2018 due to a slower pace of drilling activity, as only 2 Muskeg wells were drilled in 2018 compared to 5 wells drilled in the first half of 2017. Production volumes in the current period were also affected by elevated pipeline pressures at west Marlowe and a pipeline shutdown at North Marlowe.

Strategic is a Calgary based oil and gas company focused on exploiting its light oil assets primarily in northern Alberta. Company has a market cap of $22 million and approximately 46 million shares outstanding.

Surge Energy Inc. (SGY:TSX) announced on August 16th the appointment of two highly qualified businesswomen to the Board of Directors. This action served to diversify the Board of Directors through the addition of new skill sets and backgrounds.

Surge is extremely pleased to announce the addition of Mr. Jim Stannard to the executive team. Mr. Stannard will join the Company on September 6, 2018 in the role of Executive Vice President. With twenty-five years of very diverse experience in the energy sector, both in Western Canada and internationally.

Surge is also pleased to announce the promotions of three current leaders in the organization. Mr. Murray Bye has been named the Company's Chief Operating Officer and Ms. Margaret Elekes has been promoted to Senior Vice President, Land and Business Development. Also promoted to the newly created role of Vice President, Finance is Mr. Jared Ducs. These promotions are effective immediately.

Surge Energy is a Calgary based oil and gas company with operations in western Canada. Company has a market cap of $507 million and approximately 230 million shares outstanding.

                                       * * * * * * *

Africa Oil Corp. (AOI:TSX) announced its financial and operating results for the three and six months ended June 30, 2018. Company's operating expenses increased $46.7 million during the six months ended June 30, 2018 compared to the same period in 2017. Company reported an income of $1.592 million and a net loss of $(46.8) million in the second quarter of 2018.

Since January 2018, work to deliver on the agreed development plan has been underway with strong alignment between the Government of Kenya and the Joint Venture Partners. The project remains on track for an FID in 2019. The initial development is planned to include a 60,000 to 80,000 barrels of oil per day (bopd) Central Processing Facility (CPF) and an export pipeline to Lamu.

The initial stage is planned to include 210 wells through 18 well pads at Ngamia and 70 wells through seven well pads at Amosing, with a planned plateau rate of 60,000 to 80,000 bopd. Additional stages of development are expected to increase plateau production to 100,000 bopd or greater.

Africa Oil Corp is a Vancouver based international oil and gas exploration company. It has oil and gas interests in Kenya and Ethiopia. Company has a market cap of $560 million and approximately 471 million shares outstanding.

Birchcliff Energy Ltd. (BIR:TSX) announced its financial and operational results for the second quarter of 2018. Adjusted funds flow of $72.4 million, or $0.27 per basic common share, in the second quarter of 2018, an 18% decrease from $88.6 million and $0.33 per basic common share in the second quarter of 2017. Net income to common shareholders of $6.4 million, or $0.02 per basic common share, in the second quarter of 2018, a 62% decrease and a 67% decrease, respectively, from $17.0 million and $0.06 per basic common share in the second quarter of 2017.

Production averaged 76,296 boe/d in the second quarter of 2018, an 18% increase from 64,636 boe/d in the second quarter of 2017. Production consisted of approximately 80% natural gas, 7% light oil and 13% NGLs in the second quarter of 2018, as compared to 77% natural gas, 11% light oil and 12% NGLs in the second quarter of 2017. Light oil and NGLs production in the second quarter of 2018 increased 16% as compared to the first quarter of 2018.

Birchcliff’s 2018 Capital Program contemplates the drilling, completing, equipping and bringing on production of a total of 27 (27.0 net) wells during 2018, as well as the completion of the 80 MMcf/d Phase VI expansion of the Pouce Coupe Gas Plant. During the second quarter of 2018, Birchcliff drilled a total of 7 (7.0 net) wells, consisting of 5 (5.0 net) Montney horizontal oil wells in the Gordondale area and 2 (2.0 net) Montney/Doig horizontal natural gas wells in the Pouce Coupe area.

Birchcliff Energy Ltd is a Calgary based intermediate oil and gas company. It is engaged in the exploration, development, production and acquisition of petroleum and natural gas reserves in Western Canada. Company has a market cap of $1.275 billion and approximately 266 million shares outstanding.

Junex Inc. (JNX:TSX) announced the successful completion of their previously announced business combination pursuant to a plan of arrangement under the Business Corporations Act . . Pursuant to the Arrangement, Junex consolidated its outstanding share capital on a 10 to 1 basis, issued an aggregate of 8.6 million post-consolidation common shares and one million post-consolidation common share purchase warrants exercisable at a price of $4.00 per share to Cuda shareholders and changed its name to Cuda Oil and Gas Inc.

Cuda Oil and Gas Inc. is engaged in the business of exploring for, developing and producing oil and natural gas, and acquiring oil and natural gas properties across North America. Company is based in Quebec City. Cuda Oil and Gas has a market cap of $38.5 million and approximately 87 million shares outstanding.

Surge Energy Inc. (SGY:TSX) announced on August 15th that a cash dividend to be paid on September 17, 2018 in respect of August 2018 production, for the shareholders of record on August 31, 2018 will be $0.008333 per share. The dividend is an eligible dividend for the purposes of the Income Tax Act (Canada).

Surge Energy Inc. is Calgary based oil-weighted production and development company with high quality, large oil in place, crude oil reservoirs in western Canada. Company has a market cap of $491 million and approximately 230 million shares outstanding.                                                                                                                  
 
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Today’s Inspirations

“Before you can score, you must have a goal.”

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?

 

Any organic compound composed of carbon and hydrogen is classified as a hydrocarbon. One of the simplest hydrocarbons is methane and one of the most complex is crude oil. There are well over 200 different types of hydrocarbons.

 

prices compiled and updated on a regular basis by Canadian Insight

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 Price Spread  $27.65

  August 16, 2018

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