High gas prices, oilpatch labour crunch, pipeline friction: The year ahead in energy

- Advertisement -

The past two years have taken energy markets on a wild ride, with oil prices crashing through the basement at the start of the pandemic and exceeding US$85 a barrel last fall.

- Advertisement -

Alberta drillers and service companies are talking about the risk of labor shortages, not layoffs. More activity is expected in the Canadian oilpatch in the coming year.

- Advertisement -

But the talk of energy these days is rooted in two worlds – today’s demand and the transition ahead – as decarbonization efforts intensify with climate change.

These are just some of the stories to watch in energy over the coming months.

high petrol prices

- Advertisement -

Motorists saw a hike in pump prices last year. Statistics of Canada latest inflation report found that gasoline prices rose 43 percent by November.

rise in fuel prices As demand and economic activity return to the pandemic’s lows, which began cut oil production All over the world.

The North American benchmark price for oil climbed above US$75 a barrel last week. The average retail petrol price in Canada exceeded $1.48 a liter, According to Natural Resources Canada,

For many months, the drivers do not get much relief.

Patrick De Haan, head of petroleum analysis at GasBuddy, expects gasoline prices to rise again in March after a seasonal decline in January and February. He added that prices in 2022 may be higher than last year’s figures.

“I expect higher prices to lead to additional production,” he said. “But we will have to wait until the last innings of 2022 to really see meaningful relief.”

a busy oilpatch

Oil prices expected to rise government revenue and drilling activity, although some industry executives have recently worried trace all workers They are needed.

The Canadian Association of Energy Contractors said in November that it expects to drill 6,457 oil and gas wells this year, an increase of more than 25 percent from 2021.

Natural gas is also expected to continue making news Ripples across economies as an effect of higher prices, driving up heating and energy costs for consumers.

But in those energy prices, like ATB Financial notedhas been a “much-needed balm” to the Alberta economy and helped oil and gas producers rebuild their balance sheets, thanks to some strong cash flow,

“Certainly some new life was put into the industry, both on the oil development side as well as [natural] gas,” said Morgan Kwan, Calgary-based senior vice president in the energy and analytics intelligence team at Enverus, a global energy data analytics firm.

omicron version of coronavirus adds uncertainty to the outlook, but OPEC oil cartel It was recently indicated that it does not expect the demand for the variant to be as tough as was feared earlier.

pipeline conflict

started with last year White House halted completion Now With Keystone XL Pipeline, Calgary-Based TC Energy Chasing $15 billion trade claim,

more cross border conflict line 5. is likely to be overwhich moves approximately 87 million liters of crude oil and natural gas liquids a day between Superior, Wis., and Sarnia, Ont., passing through northern Wisconsin and the Upper Peninsula of Michigan.

Michigan Gov. Gretchen Whitmer, concerned about the risk of the leak, wants to see it closed. final defeat, Ottawa implements dispute resolution process Support for its operation is enshrined in a 1977 pipeline treaty with the United States, citing its “importance to Canadian economic and energy security”.

The domestic pipeline oilpatch also remains a source of optimism and scrutiny.

The Coastal GasLink project, which will transport natural gas off the coast of British Columbia for export, continues attract protesters Later high-profile arrests Last fall in the wet’suwet’en area.

Coastal GasLink has signed deals with 20 elected band councils along the pipeline route, including in the Wet’suwetan area, but has not received approval from most hereditary chiefs.

Work is underway on the controversial Trans Mountain Pipeline expansion project from Alberta to BC. The federal government-owned project is expected to be online by early 2023. Operation of the existing line was temporarily stopped during the unprecedented floods in BC last year.

climate test

Oil companies and politicians made big promises last year about how they intended to reduce carbon emissions rapid climate change,

Now people are waiting for the followup. Investor inquiry – and busted Are part of a market that is increasingly weighing climate change and climate risk.

Many oilseed growers had promised to achieve last year net-zero emissions by 2050,

they depend on the promises of the plans Carbon capture, use and storage (CCUS) technologies. they also include a big demand from the government — strongly opposed by groups like environmental defense canada,

At the federal level, the Liberal government is expected to release details of its plans Canadian Net-Zero Emissions Accountability Actwhich was passed in June.

Warren Maby, director of the Queen’s Institute for Energy and Environmental Policy in Kingston, Ont., is hoping for a plan to show how dependent on fossil fuels a country is. will start moving towards net zero,

“A lot of us have been thinking about this for years, but this is the first time we’re going to see the government roll out that plan,” said Mabi, who expects the news in March.

“How much renewable energy is the government estimating? What is the role of things like carbon capture and sequestration? What is the role of hydrogen?”

Mabi said he is also looking at how technology develops to help with the energy transition, such as improving geothermal energy and battery storage.

“It’s really interesting stuff that could completely change the landscape,” he said.

Energy transitions and disruptions

International climate talks in Glasgow last fall again stressed the need for change for renewable energy sources, and while there was global progress in renewable development in 2021, experts say it is clear such goals will require more work – and soon.

international energy agency reported last month That the increase in renewable energy capacity was on track to set another annual record in 2021. But it also said the current pace is not enough to get the world on course for net-zero emissions by 2050.

Adding to the discussion is the notion that even with commitments to decarbonize, as one analyst put it, it’s clear that the world doesn’t settle for energy shortages either. For example, thermal coal, Some markets saw record prices in October Between tight supply and power shortage.

“There’s an energy crunch, and we’ve seen everything,” Envers vice president Nick Volkmar said in an interview last month.

People may also be watching for growth in America as some of President Joe Biden’s ambitious renewable energy plans facing an uncertain political future,

“President has run into Biden some headwinds On its Build Back Better spending package, which included a lot of… projects related to renewable energy, incentives for electric vehicles, things like that,” Mabi said.

Event question has been raised About how to get to the White House international climate promises and underscored the political complexity of the energy transition in the world’s largest economy.

- Advertisement -

Stay on top - Get the daily news in your inbox

DMCA / Correction Notice

Recent Articles

Related Stories

Stay on top - Get the daily news in your inbox