Are we selling our sovereignty to China?

[Rocky Road]

I think we have to diversify our trade more, because the US is facing a less-than-rosy outlook over the next 20 years as their debt levels become unmanagable. Insolvency risks are already happening for some Eurozone countries, and Canada is simply an island in the stream prone to the rising tides and storms.

[Scotty]

First thing………All oil companies are multinational and transcend national boarders………Aramco (Saudi company) has built in China one of the world’s largest, most modern, refineries.

Granted, but Chinese oil companies are wholly owned subsidiaries of the Chinese Communist Party - which is made up, let's be clear, of mass murderers. Regardless of how delighted everyone likes to pretend they are about 'the new China', there are still NO human rights there, and brutality, torture, murder, and labour camps abound. In addition, of course, the Chinese government's needs may well be diametrically opposed to ours. Normal companies will base their actions on profit maximization. Chinese companies will base their decisions on what the Chinese Communist Party tells them to do.

Second thing…….it’s more efficient to refine the raw crude/bitumen closer to the end user, then tranship all the finished grades of various fuel oils, diesel, kerosene and petrochemicals etc separately……What you propose would require multiple pipelines and a drastic increase in tanker traffic.

Drastic increase in tanker traffic? I don't think so. The amount of product to be carried remains the same, regardless of whether it's processed into different fuels. I don't see why one tanker carrying kerosene, one carrying diesel, one carrying oil, are worse then three carrying Bitumen. And if you refine it at the port there's no need for more pipelines. The up side, of course, is a lot more jobs and a lot more value added to our resource - which will stay HERE in Canada.

Third thing…….What other West Coast port would you choose to terminate the Enbridge line? The Trans Mountain pipeline (and expansion) already terminate in the lower mainland………Would you build another pipeline to the South Coast and further increase shipping traffic there? Kitmat already has large port facilities for ALCAN and a pipeline through Northern BC will allow an increase of growth in Northern BC’s oil industry.

Seems to me it makes a lot more sense to expand already existing oil handling facilities than build new ones up north which will require tankers to navigate what appears, from all accounts, to be extremely dangerous waters to get back south.

[Scotty]

I think we have to diversify our trade more, because the US is facing a less-than-rosy outlook over the next 20 years as their debt levels become unmanagable. Insolvency risks are already happening for some Eurozone countries, and Canada is simply an island in the stream prone to the rising tides and storms.

By all means, sell oil to China. But process it here, and prohibit corporations owned by foreign governments from owning more than a small share in any Canadian company.

[Scotty]

Well, I would prohit the export of raw logs as long as China places restrictions on the export of rare earths they will have no way to complain.

Since they insist their oil industry be government owned they can't complain about us banning foreign government ownership in ours either.

[eyeball]

Granted, but Chinese oil companies are wholly owned subsidiaries of the Chinese Communist Party - which is made up, let's be clear, of mass murderers.

I do have to say the vitriolic hatred and fear displayed by the usual suspects towards anything that's remotely leftist in our economy stands in stark contrast against the seemingly desperate grovelling they display towards China and it's economic might.

It's a spectacle that smacks of the same filthiness that picture of Bush sucking face with a Saudi King does. It's disgusting and embarrassing.

[bush_cheney2004]

...It's a spectacle that smacks of the same filthiness that picture of Bush sucking face with a Saudi King does. It's disgusting and embarrassing.

Yea...kinda reminds me of Prime Minister Paul Martin in a Libyan tent "sucking face" with a now deceased dictator.

[waldo]

Yea...kinda reminds me of Prime Minister Paul Martin in a Libyan tent "sucking face" with a now deceased dictator.

not in the same (Bush) league!

[bush_cheney2004]

not in the same (Bush) league!

Correct...it is much worse, as the same Canadian PM got down on his knees and begged George Bush for access to oil services contracts in post-invasion Iraq.

[Jerry J. Fortin]

We lacked expertise and we lacked capital. But that isn't the case now. And I'd suggest that if external capital investment is needed we can do better than a wholly owned subsidiary of the Chinese Communist Party.

There is no doubt about it. We can do this ourselves, now anyway, but not then. I understand the argument, but I think the problem is a little too sticky. I agree that we should change the way we are doing things in terms of development. We now have both expertise and capital to do what should be done.

Now reality sets in, NAFTA and all that you know. We need to be aware that it is very difficult to change. I would suggest that if the citizens of this nation desire to take the bull by the horns, invest in ourselves, then we will benefit.

[fellowtraveller]

It's what's good for China that matters, not what's good for anyone else.

The same is true of other large economies, examples include Japan, India, South Korea,Norway, FRance. They have different approaches and certainly different scales of economies, but there is a definite merging of national interests/national strategy with government and large business.

[fellowtraveller]

Second thing…….it’s more efficient to refine the raw crude/bitumen closer to the end user, then tranship all the finished grades of various fuel oils, diesel, kerosene and petrochemicals etc separately…

Not quite. It is equally or more efficient to upograde the bitumen to crude in Alberta. I agree about the refining of the crude into finished products.

[fellowtraveller]

As I noted with regard to the forestry industry. It was in China's best interest for our lumber companies to ship raw logs to China for processing, and buying up lumber companies certainly made that more feasible -- at a cost to Canada of scores of sawmills shut down here.

The China trade is peanuts. What has really hurt our lumber industry is that our main customer-USA- stopped building houses several years ago. The endless lobbying, NAFTA challenges and court action by US lumber companies prior to that did not help either.

[Rocky Road]

Ya,I have to admit I don't like the way we cozy up to Saudi Arabia or China's economic might.

Both are evidence that the West runs on Oil & Capital, and its values are see-through when it comes to the bottom line.

[Guest Derek L]

Granted, but Chinese oil companies are wholly owned subsidiaries of the Chinese Communist Party - which is made up, let's be clear, of mass murderers. Regardless of how delighted everyone likes to pretend they are about 'the new China', there are still NO human rights there, and brutality, torture, murder, and labour camps abound. In addition, of course, the Chinese government's needs may well be diametrically opposed to ours. Normal companies will base their actions on profit maximization. Chinese companies will base their decisions on what the Chinese Communist Party tells them to do.

Canadian companies have operations throughout the Middle East………Canadian production has restarted in Libya and was only delayed in Syria for a few weeks………..You purport to take the moral high ground with just China?

Drastic increase in tanker traffic? I don't think so. The amount of product to be carried remains the same, regardless of whether it's processed into different fuels. I don't see why one tanker carrying kerosene, one carrying diesel, one carrying oil, are worse then three carrying Bitumen. And if you refine it at the port there's no need for more pipelines. The up side, of course, is a lot more jobs and a lot more value added to our resource - which will stay HERE in Canada.

It’s not that simple, different fuel grades/petrochemicals have different weights and volumes and wouldn’t necessarily translate into a like for like ratio of tankers…….Also as you earlier mention your concern of “dangerous shipping lanes” along the North Coast, when contrasted with a relatively stable cargo (Crude/bitumen) the petrochemical side of the end product is many more magnitudes more unstable.

With all this aside, the one thing that ultimately kills your idea, is who is going to pay for it? The oil companies certainly won’t invest 10s of billions in completely new refining capacity and petrochemical plants when there’s already existing infrastructure elsewhere.

Seems to me it makes a lot more sense to expand already existing oil handling facilities than build new ones up north which will require tankers to navigate what appears, from all accounts, to be extremely dangerous waters to get back south.

They, as in Kinder Morgan (One of my clients) and Chevron, are already expanding both pipelines, storage facilities and in the later case, refining capacity in the lower mainland……..Once this expansion is complete, added to the already expanding container traffic and cruise ships, the added capacity of the Northern Gateway would overwhelm the already crowded Burrard inlet, not to mention, it would restrict the size of tankers to Suezmax/Panamax as opposed to Super tankers……..

I suppose Kinder Morgan could expand on their pipeline into the Puget Sound basin, but that would kind of defeat your vision of a protectionist Canezuela……..

Edited January 18, 2012 by Derek L

[Guest Derek L]

Not quite. It is equally or more efficient to upograde the bitumen to crude in Alberta. I agree about the refining of the crude into finished products.

That is one option, then ship it as crude, and would do away with the requirement for vast sums of Natural Gas condensate, but who is going to pay for it?

[Jerry J. Fortin]

That is one option, then ship it as crude, and would do away with the requirement for vast sums of Natural Gas condensate, but who is going to pay for it?

I think we should do a great deal more upgrading refining here in Alberta. In fact, if I had my way the only way oil would be leaving Alberta would be in little one litre bottles. We need to get a grip one this before it gets any worse than it already is. Anybody here know that the word bitumen and crude oil are two very different things? Does everyone here know that royalty rates vary, with the word bitumen used in these royalty terms to create a 50% discount! The oil biz is very complicated and riddled with powerful and wealthy people. That is the foundation of very tricky politics. That is what Alberta has been dealing with since Leduc #1 !

[Smallc]

Your plan makes no sense. The infrastructure required to refine the product, let alone the infrastructure to transport the many different refined products, makes the whole thing difficult to justify economically.

[Guest Derek L]

I think we should do a great deal more upgrading refining here in Alberta. In fact, if I had my way the only way oil would be leaving Alberta would be in little one litre bottles. We need to get a grip one this before it gets any worse than it already is. Anybody here know that the word bitumen and crude oil are two very different things? Does everyone here know that royalty rates vary, with the word bitumen used in these royalty terms to create a 50% discount! The oil biz is very complicated and riddled with powerful and wealthy people. That is the foundation of very tricky politics. That is what Alberta has been dealing with since Leduc #1 !

As I said prior.......Who's going to pay for it?

[guyser]

As I said prior.......Who's going to pay for it?

Oh oh I know...the Chinese ?

[Guest Derek L]

Oh oh I know...the Chinese ?

How you going to do that?

[guyser]

How you going to do that?

I'm not.

They will offer.

[Guest Derek L]

I'm not.

They will offer.

Why would they invest vast sums of capital when the current arrangement is already beneficial? We’re not talking a few hundred million here or there……What you and others propose would be in the tens of billions of dollars range…………The Chinese already have the required refining capacity and any potential shortcomings could be solved by expanding already existing facilities at a fraction of the cost.

[Scotty]

The same is true of other large economies, examples include Japan, India, South Korea,Norway, FRance. They have different approaches and certainly different scales of economies, but there is a definite merging of national interests/national strategy with government and large business.

There is no merging to this degree. A Japanese or Korean company is going to do what is most profitable for that company. It's not going to make decisions here which detract from their bottom line because it would help other parts of their country's economies in some way.

Not to mention those country's governments are not our enemy.

[Scotty]

Canadian companies have operations throughout the Middle East………Canadian production has restarted in Libya and was only delayed in Syria for a few weeks………..You purport to take the moral high ground with just China?

I don't like dealing with any of these countries, but it's economically necessary. You notice I haven't said we shouldn't be shipping oil to China. I support shipping oil to China. I've said we shouldn't be giving control of our oil industry to China. And I'd oppose giving it to Saudi Arabia or Syria too.

With all this aside, the one thing that ultimately kills your idea, is who is going to pay for it? The oil companies certainly won’t invest 10s of billions in completely new refining capacity and petrochemical plants when there’s already existing infrastructure elsewhere.

You're right. But what's in the best interest of the foreign owned oil companies is not necessarily in Canada's best interests. We should encourage Canadian oil companies to build the refineries here through massive tax writeoffs and, if necessary loans. I consider this to be in Canada's best overall economic and strategic interests and therefore worthy of government funding if private industry can't do it.

They, as in Kinder Morgan (One of my clients) and Chevron, are already expanding both pipelines, storage facilities and in the later case, refining capacity in the lower mainland……..Once this expansion is complete, added to the already expanding container traffic and cruise ships, the added capacity of the Northern Gateway would overwhelm the already crowded Burrard inlet, not to mention, it would restrict the size of tankers to Suezmax/Panamax as opposed to Super tankers……..

I don't purport to be expert at the advantages of the different port facilities. I will state only that from what I've read, the northern port is an invitation to big oil spills, so that if at all possible, the facilities should be expanded in the south. As to Puget Sound, I think we've already seen the disadvantages of letting foreign countries control our oil exports.

[Scotty]

I think we should do a great deal more upgrading refining here in Alberta. In fact, if I had my way the only way oil would be leaving Alberta would be in little one litre bottles. We need to get a grip one this before it gets any worse than it already is. Anybody here know that the word bitumen and crude oil are two very different things? Does everyone here know that royalty rates vary, with the word bitumen used in these royalty terms to create a 50% discount! The oil biz is very complicated and riddled with powerful and wealthy people. That is the foundation of very tricky politics. That is what Alberta has been dealing with since Leduc #1 !

I've heard it said that the royalty rate Alberta charges is among the lowest in the world. Do you know what the rate is for Bitumen vs crude? And what the royalty rate might be elsewhere, such as in Saudi Arabia or Venezuela?