Roll out the barrel: Canada will immediately send oil worth the pipeline by train and truck


Briefing highlights

  • Oil truck train shipments are increasing
  • It's World Good Day
  • Market at a glance
  • Brookfield, Caisse bought a battery business
  • Amazon overrules Toronto for HQ2
  • New flyers move jobs to Kentucky
  • CEO Flipkart resigned
  • What must be considered for today

Remove the barrel

Launch the barrel, we will have a fun barrel

Take out the barrel, we get the blues on the run

Zing, boom, tararrel, there is a happy song

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Now it's time to roll the keg, for all the gangs here

– Beer Barrel Polka, carried out by The Andrews Sisters, 1939

Actually, that gang not all here.

Lost is a pipeline group.

That's why, as Derek Holt saw, glasses were raised in the Canadian railroad and truck company conference rooms as executives toasted to the fact that they would immediately move the pipeline oil.

And that is not necessarily "positive" for the environment despite the fact that environmental problems are behind it, warning the head of the Bank of Nova Scotia capital market economy as he and others regret delays in major projects.

Their comments follow the latest setback for Keystone XL TransCanada Corp. after last week's decision by a federal judge in Montana who stopped building while waiting for another environmental review by the US State Department.

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That marks a victory for the environment, the First Country and other groups, with TransCanada saying that it remains committed to a large pipeline that will transport heavy crude from Alberta.

The pipeline, of course, is controversial, some have been killed and others are tied up, especially the expansion of Trans Mountain from the pipeline now owned by Ottawa.

That also came because Canadian energy companies suffered far lower prices for Western Canada Select, asphalt and heavy oil blends, compared with West Texas brokers, US benchmark, and Brent crude.

Montana Judge stopped the Keystone XL project "due to environmental concerns, including [greenhouse gas] the emissions and hazards associated with pipelines, which the Trump administration condemned when reversing previous assessments and approving last year's pipeline, "said Mr. Holt, Scotiabank.

"Although this will not really help the already extensive discounts for Canadian oil and Bakken debris relative to WTI … it will put more pressure on rail and truck transportation to get products to market," he added in a report.

"I am not sure how the environment won there, and production will not disappear because the project completed from the past year has swung, so forget about putting the genie back into the bottle."

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When other shipping modes are taken into account, the latest National Energy Agency statistics show exports by railways continued to increase, to nearly 230,000 barrels per day in August. That should reach more than 300,000 "and potentially be higher in a fairly short period of time" because the two main railways even carry more, said Mr. Holt.

Add to that exports with trucks, which are pale when compared but reach around 230,000 barrels for August, according to Bloomberg.

The point is, add them and the projected delivery of the same amount carried by the pipe is quite large.

"This is positive for the railroad and truck transportation sector because meeting rooms in these sectors are popping champagne," said Mr. Holt.

"I failed to see how it was positive for the environment to replace the transportation mode of modern pipeline technology."

Montana's decision "cannot come at a worse time" for Canadian oil patches, said Joan Pinto, associate energy expert at CIBC World Markets.

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The Foreign Ministry can be expected to file an appeal, which may delay the date in service again, he said.

Canada's "stranded supply" has failed to benefit from a previous rally in oil prices, Ms Pinto added. And manufacturers are reluctant to reach long-term agreements with trains, still hoping for cheaper pipeline alternatives.

There is also a "broad termination" between being sent compared to a much greater capacity to send it.

"This impasse began as a result of the Canadian railroad company which was slow to offer short-term contracts," Pinto said.

"In our view, because the federal government has chosen to function as a pseudo petro country with purchases [Trans Mountain] the project, which requires the temporary export of trains to ease delays in pipeline infrastructure, is an action adopted by the typical petro country to overcome the deadlock, "he added.

"Indeed, Alberta Premier [Rachel] Notley has formally requested federal government intervention in increasing the volume of crude oil per rail. "

When you collect everything, including low prices for Canadian crude, domestic producers experience difficulties.

"President Trump quickly called [Keystone XL] decision a & # 39; disgrace, & # 39; and there is a possibility that the verdict can be canceled by a higher court, "said Bank of Montreal chief economist Douglas Porter.

"Even so, the decision only shows a lot, many roadblocks that Canadian producers will continue to face to get products from the country, and make dark clouds float above future investments in the industry."

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Brookfield, Caisse bought a battery business

Brookfield Business Partners LP and Caisse de dépôt et placement du Québec are working with a power solutions business from Johnson Controls International PLC for US $ 13.2 billion.

The operation they bought produces batteries for car makers and other businesses, with more than 15,000 employees in 150 countries.

Brookfield and Caisse funded an agreement with around US $ 3 billion in equity and US $ 10.2 billion in debt.

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What must be considered for today

This is a deadline for Italy to give the European Commission a revised budget, and observers suggest the government will change slightly from its first version, opening the door to EC penalties under excessive deficit procedures that sound terrible, which sounds like something my bank might have. in store for me.

"Next week will be very telling about the attitude of the Italian government and how it wants to work with all of Europe," BMO senior economist Jennifer Lee said.

"The European Commission has a November 13 deadline for Economy Minister Giovanni Tria to produce a revised budget, which is based on less optimistic growth projections," he added, noting that Italy projects 1.5 percent economic growth next year, compared with estimates of EC 1, 2 percent and BMO calls for something ashamed of 1 percent.

"So far, there has been no indication that Italy will bend a little even against the European Commission's will," Lee said, citing Tria's refusal to change.

"To be honest, if the government changes its plans a little (such as delaying changes in retirement age), to show that it is trying, we can see heat being diverted," Lee said. "And, international investors will stop selling Italian debt."

There are some soothing words from European partners, but, as Ms. Lee, the talk is cheap.

"It is very possible that we can see fines imposed on Italy (opening excessive deficit procedures), or sanctions in the spring, just before the European Parliament election."

In front of the company, Canaccord Genuity Group Inc. report quarterly results.

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