Oilsands projects to keep pumping while losing money: analyst

CALGARY -- Oilsands operators have little choice but to keep pumping despite the fact that they're losing money on every barrel they produce at today's crude prices, according to an industry analyst.

See Full Article

Martin King, with investment dealer FirstEnergy Capital, says once an oilsands project is up and running there are big technical issues with hitting the off switch.

King told an energy conference hosted by the Conference Board of Canada that oilsands projects are built to run for decades and can run for years losing money.

His remarks came on a day that prices for West Texas Intermediate crude, the U.S. benchmark, tumbled ever closer to the US$30-a-barrel mark, down more than 70 per cent decline from mid-2014 highs.

And that's not even the price Canadian heavy oil producers fetch, which is discounted because it's harder to refine and further from market.

The price of Western Canadian Select now is below US$17 a barrel.

The Conference Board expects WTI to average just US$40 a barrel this year because there's "too much supply in the world," said Glen Hodgson, the think-tank's chief economist.

"Our grind back to even something around US$60 a barrel is going to take a number of years."



Advertisements

Latest Economic News

  • PepsiCo makes biggest public pre-order of Tesla Semis: 100 trucks

    Economic CBC News
    PepsiCo Inc. has reserved 100 of Tesla Inc.'s new electric Semi trucks, the largest known order of the big rig, as the maker of Mountain Dew soda and Doritos chips seeks to reduce fuel costs and fleet emissions, a company executive said on Tuesday. Source
  • MTY Food Group signs deal to buy Imvescor Restaurant Group for $248 million

    Economic CBC News
    MTY Food Group Inc. is growing beyond the shopping mall food court with a $248-million stock-and-cash deal to buy Imvescor Restaurant Group Inc. and its full-service restaurant and grocery products businesses. The friendly deal will bring together such MTY banners as Thai Express, Vanellis and Manchu Wok with Imvescor's Baton Rouge, Pizza Delight and Scores restaurants to create a company with a portfolio of over 5,700 stores under 75 brands. Source
  • Iceland closes gender gap but violence against women remains

    Economic CTV News
    REYKJAVIK, Iceland -- For nine years in a row, the World Economic Forum has ranked Iceland as having the world's smallest gender-equality gap, and for about as long gender studies professor Gyda Margret Petursdottir has been asked how the Nordic island nation became such a paradise for women. Source
  • Lyft ride-hailing app arrives in Toronto, marking its first expansion outside U.S.

    Economic CTV News
    TORONTO -- Ride-hailing service Lyft will be available in Toronto starting today. Torontonians can download the Lyft app to being ordering rides in the city. The company's arrival in Toronto marks the first time it has expanded outside the US. Source
  • Bombardier signs deal to sell Aventra trains in U.K.

    Economic CTV News
    BERLIN - Bombardier Transportation (TSX:BBD.B) has signed a deal to supply 333 new rail cars, along with a contract for maintenance work, with a U.K. rail company. Corelink Rail Infrastructure and West Midlands Trains will receive 333 new Bombardier Aventra vehicles for use on the United Kingdom's West Midlands Trains franchise. Source
  • Ride-hailing service Lyft expands outside U.S. for 1st time to take on Uber in Canada

    Economic CBC News
    Starting today, Torontonians will have another option to get around the city. Lyft has launched outside the U.S. for the first time, putting pressure on Uber for a share of the ride-hailing market. Other Canadian cities are in Lyft's sight as the company, Uber's main rival in the U.S. Source
  • Cost of child care up by 20% in some cities since 2014, report finds

    Economic CBC News
    The cost of child care is rising quickly in Canada, in some cities increasing by as much as 20 per cent from three years ago and more than 10 per cent in most of Canada. Source
  • Toronto leads country in child-care fees, but costs rising almost everywhere

    Economic CBC News
    The cost of child care is rising quickly in Canada, in some cities increasing by as much as 20 per cent from three years ago and more than 10 per cent in most of Canada. Source
  • World shares retreat ahead of Fed interest rate decision

    Economic CTV News
    TOKYO -- Shares were mostly lower in Europe and Asia on Tuesday as investors retreated ahead of the Federal Reserve's decision on interest rates. KEEPING SCORE: Germany's DAX fell 0.2 per cent to 13,099.40 and the CAC 40 of France lost 0.5 per cent to 5,362.83. Source
  • Health care and materials lead the way on Toronto market, loonie lower

    Economic CTV News
    TORONTO -- The health care and materials sectors helped boost Canada's main stock index in late-morning trading as the loonie lost ground. The S&P/TSX composite index was up 24.83 points to 16,128.34, after 90 minutes of trading. Source