Showing posts with label Penetration Grade Bitumen. Show all posts
Showing posts with label Penetration Grade Bitumen. Show all posts

October 5, 2017

Road Topping Tender

Brace yourself for more chaos on the roads

Biggest white topping project to date set to begin in second week of October

In tune with the State government's move towards white topping roads, the Bruhat Bengaluru Mahanagara Palike (BBMP) has approved tenders for white topping 29 roads and six major junctions totalling to a length of 93.47 km at a cost of ₹723.71 crore. For motorists, this will be mean smooth roads, but citizens remain sceptical given the deteriorating condition of roads every monsoon.
Work is expected to begin in the second week of October simultaneously on multiple roads, and add to the traffic chaos across the city.
 
“BBMP has set a one-year deadline for completion of works on the 29 roads. We have split the work and given tenders to two firms so that the project starts simultaneously and is finished on time,” said K.T. Nagaraj, Chief Engineer, Projects, BBMP.
All roads will be provided with service ducts on either side for optic fibre cables and power cables. However, sewage and water lines will not be shifted, sources said.
White-topping is an overlay of Portland cement concrete layer over the existing asphalt layer on the road. Chief Minister Siddaramaiah and City Development Minister K.J. George are passionate votaries of the technology. Recently, Mr. Siddaramaiah had said that he would like to see roads in the city to be white-topped.
For now, however, sections on major roads like Outer Ring Road, Mysuru Road, Brigade Road, Hosur Road, Bannerghatta Road, Sarjapur Road and Tumakuru Road will be revamped.
This will be the biggest white-topping project in the city to date.
Bengaluru City Traffic Police, who have given their go-ahead for the works, said that though the project will disrupt traffic in the short run, white topping of roads is better since it provides a pothole-free ride, once completed. “We cannot block the roads. Work will be taken up on one lane while traffic will be allowed on the opposite lane,” said R. Hitendra, Additional Commissioner of Police (Traffic). He added that they would like the BBMP to press more paver machines into action to speed up the process.

September 27, 2017

Mombasa to Nairobi- The Political Road

In another three years, a Kenyan travelling from Mombasa to Nairobi will have at least four major options Kenya has chosen to build a brand new road between Mombasa and Nairobi instead of expanding the existing highway in what will leave consumers spoilt for choice Transport CS James Macharia said the deal had not been signed and that several other companies could be allowed to bid Kenya has chosen to build a brand new road between Mombasa and Nairobi instead of expanding the existing highway in what will leave consumers spoilt for choice.

The Sunday Standard has established that instead of turning the current road into an expressway, the government decided to construct a completely new road to run side by side with the existing one. ALSO READ: Kenya Railways threatens top managers of RVR This means that in another three years, a Kenyan travelling from Mombasa to Nairobi will have at least four major options. One may choose the Standard Gauge Railway (SGR) passenger train that takes about five hours or take a flight and land in the coastal town in an hour. If he wants to travel by road, he will have two roads to pick from. If in a hurry, and would like to drive at speeds of 120 kilometers per hour, he will take the expressway whose contract was handed to an American firm, Bechtel, three days to the General Election in a deal described as a ‘thank you gift’ to the Americans.

This will not just be the most comfortable drive given how smooth the road would be, it will just take him three and-a-half hours. But this will not be without a cost. He will have to part with some unspecified amount of money in toll fees to enjoy the road. If he does not want to pay or is not in a hurry, he will still have the current road at his disposal, which will be available but only for smaller vehicles. The current road will also have been downgraded to stop trucks and big buses from using it. Shelved proposal It will also mean that the government will buy land afresh, in a similar fashion as it did before it build the SGR, in what could provide land cartels with another round of minting millions from government projects. The initial proposal, which was shelved in favour of the current deal, involved expansion of the existing highway to four lanes between the Machakos Turnoff to Mariakani.  ALSO READ: Kenya Railways threatens top managers of RVR It has also emerged that the contractor building the controversial expressway will be allowed to ‘sell’ it to another private contractor, who will charge users toll fees to recoup the billions sunk in the project.

“Under the Exim Bank financing model, the government has the opportunity to privatise or securitise the individual sections of the expressway that could reduce the total borrowing requirements,” Engineer Peter Mundinia, the director general of the Kenya National Highways Authority (Kenha) said in a statement. The authority, however, refused to comment on the cost of the project. A source familiar with the project says the government will pass the road to private investors, who have the experience to monetise the road. “Private investors will buy the road and charge toll fees in line with the initial Public Private Partnership (PPP) model after it is constructed.

This must not wait until it is fully built but it can start with the sections as they get completed,” a source said in an interview. This will make the multi-billion road the first ‘private road’ in the region. Kenha has contradicted the Ministry of Transport which had denied claims that the contract had been signed. In a press release this week, Kenha said the commercial contract for the project was signed on August 5. Reacting to an earlier story by the Standard, Transport CS James Macharia said the deal had not been signed and that several other companies could be allowed to bid. ALSO READ: Kenya’s Sh300b ‘thank you gift’ road project to US sparks tender wars But Kenha, which handed the project to the American firm without a competitive process, says the development is under its mandate. Available estimates show that the project will cost about Sh300 billion, before the cost of buying the land is factored in.

Kenha says its economic projections show that there is an infrastructural symbiotic relationship between the SGR and the new road as it offers connectivity for people, business and communities along the road. “Once completed, the expressway will play a critical role in improving Kenya’s transportation logistics and trade competitiveness while supporting the spatial and industrial development along the corridor,” Mundinia said. Kenha has defended the decision to opt for the construction of a new road on grounds that it is distinct from the PPP alternative given that it offers a new alignment designed as a high speed six-lane expressway of higher capacity and safety standards.

“The expressway project will include highway capacity through construction of the greater Nairobi-Southern Bypass which has been planned for several years, thereby contributing to decongestion of the fast-growing Nairobi Metropolitan Area,” Mundinia said. But as details of the deal become available, it is emerging that the mega project has stark similarities to the SGR contract handed to a Chinese company in the run-up to the 2013 General Election. Both the contracts of the SGR and the expressway project were signed shortly before the elections. The firms constructing them are the ones tasked with determining the costs of the projects. Worse, both have been single-sourced and were entered in the cover of government-to-government contracts, in deals that reduce the level of public disclosure and scrutiny that open tenders go through. The biggest concern for sources familiar with government financing is that both of these projects are now going to be financed largely from borrowing at a time when the government is exhausting its headroom to stock up any additional debt.

Kenya Railways set to operate old line It has emerged that top officials of the PPP directorate were caught unawares after the government made an about turn on the project and decided to build a new road instead. A working paper from insiders at the Treasury and the Ministry of Transport seen by this paper raised sharp questions on why the project had to be announced in a rush, three days before the elections, and why it was not competitively done. The deal has also brought back the American government on the front row seat of firms that have bagged big infrastructure projects after being elbowed out by Chinese companies.

A brief by the State Department of Infrastructure as it sought concurrence to proceed with the project says Kenya will borrow funds from American lenders (US Exim Bank and OPIC) and then sign an Engineering, Procurement and Construction (EPC) contract to build the road on a single source basis. The brief queries why a previous model financed by the World Bank was abandoned and how it was determined that the single sourcing approach would offer taxpayers better value for money and would be faster than a PPP.  “Although the proposal is being referred to as ‘alternative project concept’ or ‘highway development concept,’ it is simply a non-competitive, single source procurement of an EPC contractor who is able to bring financing with it,” the brief notes. Engineer George Kiiru, the head of PPP at Kenha, told the Sunday Standard that the government changed its focus from a PPP to EPC because it will be delivered faster as compared to PPP. Shorter period


 “Achieving commercial and financial close for PPP contracts can take two to three years thereby delaying the start of construction and completion of the project,” Kiiru said. “A comparative analysis between a PPP model for a 20-30 year concession shows cumulative repayments under the PPP approach would be higher compared to the alternative approach with ECA (US Exim/OPIC) support,” Kiiru said. The brief from the State Department of Infrastructure, however, intimates that there is no reason to suggest that the construction will take longer under the PPP arrangement. “Indeed, there are strong arguments that overall construction period may be shorter under the PPP project as it splits construction between three different EPC contractors. In any event, the constraining factor is always likely to be land acquisition, so it would be a mistake to assume that the Betchel proposal can deliver construction completion more quickly,” the brief notes.   Kenha says the government is yet to determine the exact cost of the project and is waiting for a complete detailed design, which is yet to be undertaken, before it can determine the actual cost. Kenha also refused to give a cost range that the project is expected to fall in on grounds that it did not want to speculate despite the fact that costs are the first considerations in deciding if a project is viable or not. Costs per kilometre “This project is a government to government initiative. The US Government nominated Betchel International to work with the implementing Agencies in Kenya to develop the project,” Kiiru said. In 2015, Kenha says, the governments of Kenya and the US signed a memorandum of understanding for development of priority infrastructure projects supporting Kenya’s Vision 2030. Kenya later held discussions with the US government for development of the highway. The US, through the US Exim Bank, has provided a letter of support to Betchel for the Nairobi–Mombasa Expressway under a proposed government to government agreement.

“The US Exim Bank has shown interest to finance the project together with other US Export Credit Agencies such as the Overseas Private Investment Corporation (OPIC),” Kenha said in its response. The brief says Betchel’s construction costs per kilometer are higher than estimates presented to the ministry by PricewaterhouseCoopers (PwC) on construction costs for the PPP approach of Sh600 million per kilometre versus Sh500 million per kilometre ($6 million Vs $5 million). “The per kilometre costs under the PPP proposal includes all taxes and duties while Betchel’s proposal assumes complete tax exemption for the project (corporate tax, income tax and import duties) which could reasonably be assumed to cost the government an additional Sh100 million per kilometre,” the brief notes. It goes on to argue that as part of the American firm’s proposal, an advance payment of Sh30 billion and also a payment of Sh10 billion as ‘establishment fee’ will be required. “So Betchel will be Sh40 billion in funds and highly cash positive before the start of the project whereby the government will be paying interest on this sum from day one as this will be drawn immediately by Betchel at contract signing,” the brief notes. There is also a further Sh6 billion of design management fees. The proposal from the American firm excluded all relevant taxes.

Read more at: https://www.standardmedia.co.ke/article/2001255435/billion-shilling-u-turn-that-will-cruise-you-to-coast-in-three-hours

October 10, 2016

TOT or Advance Selling of Human Traffic Loads ?

The National Highways Authority of India (NHAI) is preparing to start the process of monetizing toll-based operational road assets under the toll, operate and transfer (TOT) model, aimed to bring new investments to the highways sector.

“We have not as yet floated tenders to monetize road assets, but are preparing to do so. We expect to begin doing this in 2-3 months’ time under the TOT model,” NHAI chairman Raghav Chandra said in an email response to queries from Mint.

This will be India’s first exercise in auctioning NHAI’s operational projects after a cabinet clearance in August. The proceeds will fund new highway projects under various models.

NHAI is currently working on the guidelines for TOT, under which the investor will collect tolls and be responsible for operation and maintenance of the project. The TOT model will be essential to attract long-term foreign investment, financial investors and investment bankers told Mint.

NHAI can lease up to 75 national highway projects which are fetching tolls for at least two years to various entities on the TOT model. The overall annual toll collected from these projects is about Rs2,700 crore, against which NHAI can expect to raise Rs25,000-30,000 crore by granting 30-year concessions, said Ashish Agarwal, director (infrastructure) at investment bank Equirus Capital.

The TOT model is long overdue, said Gautam Bhandari, partner at I Squared Capital, a US-based investor in road projects. “We are hopeful that NHAI finally does launch its TOT programme so that it can serve as a model for other sectors as well. As a global investor, we believe that NHAI’s TOT model, if executed properly, could be a win-win for everyone. Proceeds from TOT auctions will free up valuable taxpayer capital that can then be recycled for much-needed new infrastructure projects,” he said.

I Squared is looking to invest as much as $1 billion in Indian infrastructure. It has invested more than Rs1,000 crore through its investment platform Cube Highways and Infrastructure Pte. Ltd in three road projects so far.

IDFC Alternatives, which has bought controlling stakes in operational road projects, is waiting to see the fine print. “The good part is that in the TOT model, there are far less variables and concerns to be addressed as compared to projects with embedded construction risks. The differences in the bids here would be more a function of how differently each investor views the traffic growth rates, maintenance costs, synergies with other projects in one’s portfolio, if any,” said Aditya Aggarwal, partner (infrastructure), IDFC Alternatives.

There is significant interest from international infrastructure funds in the Indian road sector, said Rahul Mody, managing director, Ambit Corporate Finance Pvt. Ltd. “The TOT model is an excellent idea. The model takes away two key risks in the road sector—delays or cost overruns and initial traffic discovery—as the assets that will be offered under this (model) will be operational with some tolling history; hence it should attract considerable interest from Indian companies as well as foreign investors,” Mody said.

“The model can be an avenue for NHAI to raise upfront capital to fund the EPC and HAM projects; opportunity to feed the increasing number of pension funds and infrastructure investors having access to low cost capital and further deepen the infrastructure market; and allowing players to choose better the nature of risk-reward play they want to play in the road sector,” Agarwal said.

Source- LiveMint

October 8, 2015

Nigeria Missed the Bus Again - This time Not Crude But Bitumen

Iriele is a small community situated in Ondo State and the indigenes have high demands for development. Over the years, they have dreamt of the day when bitumen would be exploited, creating job opportunities, infrastructure and economic prosperity. The people of this town consider bitumen as a God endowed heritage which should be harnessed immediately to create jobs, deliver infrastructure and reduce the hardship they face daily. 

Those dreams have not become reality up till now, denting their hopes and leaving them frustrated as the indigenes of these towns wait endlessly for the government to attract the needed investment.

In the light of the foregoing, is the wider debate about Nigeria’s rich mineral reserve and the failure of the government to properly utilise the wealth of the nation to the betterment of lives of the citizenry. This belief is voiced by majority of the ordinary people in this bitumen bearing community including border communities like Agbabu and Ilubirin.

Nigeria is the sixth largest bitumen deposit in the world with most of the reserve found in Ondo State. However, there’s a wider debate about Nigeria’s rich mineral reserves and the failure of the government to properly utilize the wealth of the nation to the betterment of lives of the citizenry.

This belief is voiced by majority of the ordinary people in this bitumen bearing community including border communities like Agbabu and lIubirin. They have argued that since 

Nigeria’s crude might no longer generate sufficient revenue to run the nation’s economy, there should be an alternative to fall back on. In the perspective of these pro-bitumen agitators, bitumen is a guaranteed option as Nigeria re-defines its roadmap to economic recovery.

A lawmaker representing the Irele-Agbabu State Constituency in Ondo State House of Assembly, and one of the key proponents of bitumen Honourable Afolabi Iwalewa, thinks that the wobbly situation of Nigeria’s oil is a wakeup call for the exploitation of bitumen:

“ Any moment from now, crude oil will fade off. Look at what is happening now with the talk of oil theft. Every state is crying now, even the Federal Government is crying that it is not getting what it used to get from oil. What is the Federal Government doing, and why can’t we find another alternative? If crude oil is not going to fetch us what we project (in terms of revenue), why can’t we switch over to bitumen?”

Another standpoint of Honourable Iwalewa’s pro-bitumen advocacy is that the non-exploitation of the resource is causing people in these communities a lot of trouble because they have to cope with the reality of spill ravaging precious farmlands where bitumen is found so close to the surface that a simple shovel can excavate the glossy black substance.

Bitumen is found in tar sands, which is also a combination of clay, sand and water. A heavy black viscous substance, oil-rich bitumen is extracted from tar sands, which is then refined into oil. The bitumen in tar sands cannot be pumped from the ground in its natural state; instead tar sand deposits are mined, usually using strip mining or open pit techniques, or the oil is extracted by underground heating with additional upgrading.

In essence, it involves a complex process that will certainly disrupt their lives and livelihoods beyond what they can imagine. This is what the people of the bitumen bearing communities in Ondo State are calling for when they appeal for the exploitation of the resource in their soil.

Taking a closer look at the experience of Canada, the biggest producer of tar sands globally, shows that exploitation has actually resulted in serious damage to the local communities and the environment. The clearing of vast area which is a component of the mining process is responsible for the Canadian moon-landscape we see in Alberta, Canada, where large forest with pristine trees that sprawled across its landscape now looks more like a waste land ravaged by the exploration of bitumen.

In spite of all of the warnings pointing at the dangers of venturing into tar sands exploitation, especially the apparent impacts of livelihoods of ordinary people due to the far reaching implications for the environment, including the lands and water bodies, the people in the bitumen bearing communities have inclined to brush these opinions aside.

Olofun of lrele, Oba Olarenwajulebi, the octogenarian traditional ruler of the Irele community, for instance, criticizes talk of possible environmental hazards if bitumen were to be extracted in the area. He brags about of what his realm would look like if development were to prevail, using bitumen as the tool.

“If development were to succeed the way the people of this area want it, this town would have looked like Lagos. I say so because bitumen will provide a lot of employment for all the youths in this area, not in Irele alone, but all over the Southern senatorial district and even in the whole of Ondo State. The bitumen deposit here is a very huge one. It is the second largest in the world, according to the survey conducted by some experts,” he enthused.
And on the Canadian experience he explained: 

“In Canada, they do it in Calgary, and I have been there. They don’t drive away communities, and they replenish the soil. Where they mine the bitumen, they mix the soil with some chemicals, and restore it for the farmers to go back there and farm. And when those people were working here, I talked to them and they told me that even if they have to relocate some communities, they will have to build some fine buildings for them, and that the exploitation won’t affect much of their lands. It is something that they will dig from the ground; and it won’t affect us adversely.”

There’s no doubt that the allure of jobs, development and the improvement they envisage that bitumen development would give to their communities has strengthened their resolve to continue campaigning for the exploration of their God-given wealth. Any attempt to make the pro-bitumen agitators to consider the consequences is usually met with cold shoulders.

However, a geologist at the Federal University of Technology, Akure, Ondo State, Professor Peter Odeyemi offered a much more balanced picture of the realities on the ground. Odeyemi, who was a member of the defunct Federal Government’s Bitumen Implementation Committee (BIC) made a poignant observation when he noted that the mere presence of a resource does not necessarily translate into commercially viable deposits.


“The first thing is that how much is there? We don’t know! We need to carry out further work in that area in the first instance. Secondly, exploration can be carried out by an oil company because bitumen is a hydro-carbon but also there are difficulties (technical difficulties). If an oil company is going to carry out an exploration there, there is an interest, financial one. This company will calculate how much it’s going to get. It will also look at certain technical issues and the ease of exploitation. This is so because although both of them are hydro-carbon, one is easier to exploit than the other.

Also,how will you exploit without exposing the soil to direct rain fall impact, denudation, erosion and degradation. So they have generation of enlightened professors and everything. The place is highly enlightened and the environmental issues are potent here like in Europe. If you look at the Niger Delta, the people just welcomed oil companies with open hands not knowing that oil companies are devils. They are only interested in profits. They are not in any way interested in environmental sustainability, in flora, in fauna and even in the development of the people,” he said.

He continued: “Our problem is not bitumen; our problem is corruption. What do we do with the money we have been getting from oil? The one we are exploiting, what are we doing with it? The people are getting poorer; there is no electricity, water, healthcare, and education. This is despite the fact that we are making trillions of dollars. So, if we now exploit bitumen and add another trillion, we are just going to multiply the corruption,” Odeyemi concluded.

There is no doubt that the exploration of bitumen will have a heavy toll on the environment of Iriele, and neighboring Agbabu and IIlubirin Communities in Ondo State. Water will be polluted, farmlands destroyed, large expanse of forest will be brought down and communities destroyed. Is this kind if cost these communities are willing to pay or are their alternative development paths that communities can take that will have more sustainable economic impact? As the federal government plans to diversify the economy, and explore mining of solid minerals as an alternative, there’s no gainsaying that the environment must be protected even as the nation seeks improved economic fortune.


Inwerogu wrote from Lagos

September 23, 2015

Process and Save OilSands

Plans For Bitumen Refinery Ramp Up

Keynote speaker Frank McKenna at Bitumen Conference in Sarnia May, 2013Keynote speaker Frank McKenna at Bitumen Conference in Sarnia May, 2013
The Chairman of the Sarnia-based Bowman Centre is convinced that in 2016, possibly sooner, a commercial partner will be announced for the ambitious $10-billion SABER project.
The Sarnia-Lambton Advanced Bitumen Energy Refinery would process heavy crude from the Alberta Oil Sands and has been described as a potential game-changer for the economy.
The Bowman Centre, located at the Western Research Park, says 30 local organizations have recently committed over $100,000 to take the project to a new level.
Clem Bowman says a commerical proponent is needed to update marketing, logistics and margin analysis reflecting current crude oil prices.
He says with Prime Minister Harper’s indication of support in principle, they can proceed with or without the support of the provincial government.
Audio Player
A group of former Chemical Valley executives launched the project saying Canada is losing $2.5-billion a year by exporting, rather than processing oil sands bitumen at home.
They say there is an existing pipeline from Alberta to Sarnia, access to international markets and serviced industrial land available.
There is also a commitment to build a leading edge plant in terms of energy and greenhouse gas efficiency.
(With files from Josh Boyce)

August 29, 2015

Bitumen or the Environment ?


Aboriginal groups fear the consequences if bitumen from the Alberta oilsands were to spill into the sensitive ecosystem of Great Bear Rainforest. Part of the 2015 Atkinson Series on public policy.

A humpback whale breaches the surface near Hartley Bay along the Great Bear Rainforest in British Columbia. First Nations in the region are vehemently opposed to the Northern Gateway pipeline.
JONATHAN HAYWARD / THE CANADIAN PRESS FILE PHOTO
A humpback whale breaches the surface near Hartley Bay along the Great Bear Rainforest in British Columbia. First Nations in the region are vehemently opposed to the Northern Gateway pipeline.
Art Sterritt is the executive director of Coastal First Nations, an alliance of aboriginal groups in British Columbia. Though living about 1,200 kilometres west of the oilsands, Sterritt and other native leaders in the area have developed a keen interest in the production of thick black bitumen.
That’s because oilsands developers and Enbridge are proposing the $8-billion Northern Gateway pipeline be built between northern Alberta and the B.C. coast. It would move 525,000 barrels a day of diluted bitumen to Kitimat. There, it would be loaded onto tankers that would have to navigate chains of islands and narrow channels before reaching open sea en route to Asia.
The coastal First Nations in the area, known as the Great Bear Rainforest, make up the majority of the population, and they don’t want the pipeline. They particularly don’t want tankers full of diluted bitumen — which is much thicker than crude oil — in waters where salmon abound in a complex ecosystem that has supported their people for centuries.
“We are never going to allow pipelines as long as (the oil) can’t be cleaned up,” Sterritt told an audience in Calgary in June. “We know what happened just to the north of us with the Exxon Valdez.”
Haisla First Nation hereditary chiefs attend hearings on the proposed $8-billion Northern Gateway pipeline in B.C. in 2012. The pipeline was eventually approved, with 209 conditions.
DARRYL DYCK/THE CANADIAN PRESS
Haisla First Nation hereditary chiefs attend hearings on the proposed $8-billion Northern Gateway pipeline in B.C. in 2012. The pipeline was eventually approved, with 209 conditions.
In March 1989, the Exxon Valdez supertanker struck Bligh Reef and spilled 11 million gallons of crude oil into Alaska’s Prince William Sound. It was the worst American spill up to that point, damaging more than 2,000 kilometres of shoreline and killing hundreds of thousands of birds and marine animals and untold numbers of fish.
The Northern Gateway pipeline was the subject of extensive public hearings by the National Energy Board in 2012 and 2013, during which Sterritt’s group and others registered their fears. In the end, the National Energy Board approved it with 209 conditions that must be met before it proceeds. The Harper government seconded the motion when it gave its approval a few months later.
But many doubt the pipeline will ever be built because it is the subject of 18 court cases. Enbridge has confirmed that it won’t be in service by 2018, as previously predicted.
That’s fine with Sterritt, who asserts that it is incumbent on the oil companies to figure out how to clean up a spill should a tanker rupture or capsize.
“So far they haven’t done that,” he said. “There is no technology available to clean up oil spills. They just keep telling us that the chances of a spill are very low. But that’s not good enough.”
According to the final report of the Northern Gateway Joint Review Panel, there is significant disagreement among experts about whether the heavy diluted bitumen would sink to the sea bottom if a tanker ruptured, making it much more difficult to clean up than if it were floating on the surface. Enbridge says the diluted bitumen would float, but intervenors from Environment Canada and Fisheries and Oceans testified that their studies were inconclusive.
The joint review panel decided that a spill is “not likely to sink as a continuous layer that coats the seabed or riverbed.” But some of the conditions Enbridge must now meet deal with spill response and require further research on the likelihood that diluted bitumen would sink.
Meanwhile, bitumen is being transported by existing pipelines and trains. But as production at oilsands operations increases, there will be more pressure to build a pipeline such as the Northern Gateway.
Douglas Channel is the proposed end point of the Northern Gateway pipeline, which would carry 525,000 barrels a day of diluted bitumen from northern Alberta to the B.C. coast. Experts say more research is needed on the effects of an oil spill involving oilsands products.
DARRYL DYCK/THE CANADIAN PRESS
Douglas Channel is the proposed end point of the Northern Gateway pipeline, which would carry 525,000 barrels a day of diluted bitumen from northern Alberta to the B.C. coast. Experts say more research is needed on the effects of an oil spill involving oilsands products.
Source & Copytight -THE STAR

October 17, 2014

Return of the Bitumen Bubble

The Author discusses the Bitumen Bubble in waiting if the curdue oil price falls below USD 80.

Just when you think you're finding your way out of the woods, there's that damned Bitumen Bubble again.
This time, it's crude oil prices that are declining -- or, as they say in journalese, the official language of the Internet, "plummeting."

This is handy for conservatives once they're elected and want to cut the crap out of public services they promised to protect, but not so good in the lead-up to an election during the phase when conservative governments of all stripes go into a tax-and-spend-liberal-spree mode and shower dollars on electors.
The special problem facing newly selected Progressive Conservative Premier Jim Prentice out here on the western edge of the Great Aspen Parklands is that his principal opponent in the upcoming Oct. 27 mini-election, in which he hopes to get his own place in the Legislature and a couple more for his two unelected cabinet members, is another conservative party.

Before October 27 and certainly before the next general election, the Wildrose Party under would-be premier Danielle Smith will scream if the budget isn't balanced, and large numbers of cherry-picking voters will grow surly and disagreeable if it is, leastways if that means their particular enthusiasms aren't fully funded.
Imagine how much easier things would be for Prentice's PCs if the official Opposition party were the NDP!

Well, New Democrats will be working on that this weekend in Edmonton, but in the meantime the premier is just going to have to figure out a way to live with the cranky deficit scolds from the Wildrose opposition who don't have the disadvantage of having to actually run the place at the same time as they're trying to live down fired premier Alison Redford’s gruesome reputation.

It's always astonishing to me that conservative politicians -- who supposedly have the inside track on thinking like business people -- can’t figure out that commodity prices are cyclical. In other words, this week's oil-prices-are-too-low crisis can turn overnight in to an oil-prices-are-too-high crisis, and Prentice most certainly hopes it does.

Meanwhile, a new public opinion poll by ThinkHQ Public Affairs suggests Prentice's PCs are enjoying a bit of a honeymoon bounce -- although not necessarily where they need it the most for the four upcoming by-elections, three of which are in Calgary and one here in Edmonton.

ThinkHQ President Marc Henry's take Tuesday on these numbers was that "Tory fortunes have turned sharply positive" and, moreover, "the momentum shift is in the Tories' favour."

ThreeHundredEight.com author Eric Grenier's analysis of the same numbers yesterday, however, was that while the poll shows the Prentice PCs are closer to the Wildrose popularity numbers than they've been for a while, the Wildrose is doing well enough in Calgary it will be hard for the government to win all four seats.
So, from the PC perspective, this close to four crucial and highly symbolic by-elections was probably not the right moment for the media to start chanting gloom and doom about oil prices at the shocking thought of oil descending to a mere $82 per barrel.

Meanwhile, also yesterday, without any fanfare whatsoever, the government quietly issued a proclamation repealing the Redford Government's draconian Bill 46. That law -- technically known as the Public Service Salary Restraint Act -- would have enabled the government to order the Alberta Union of Provincial Employees back to work with a truly crappy contract had not the Alberta Court of Queen's Bench intervened last February and granted the union an injunction blocking the law's application.

The court's scathing ruling -- which excoriated the Redford government for bargaining in bad faith and other labour relations sins -- blew the government's entire strategy for dealing with its public service unions to smithereens.

In a way, the repeal of Bill 46 is meaningless -- a negotiated deal with AUPE after the injunction was issued having effectively rendered it moot.

Nevertheless, it can hardly have been unintended that one of the few remaining relics of Redford's bizarre anti-labour legislative agenda was tossed over the side the day before AUPE’s 38th annual convention was scheduled to start. That meeting will commence at 9:00 this morning with 800 or so AUPE members belting out Solidarity Forever.

Prentice's hope, it is said here, must have been that the symbolism of this will remind unionized public employees of the dangers of voting for an even more conservative party than the PCs.

However, still remaining on the law books, sort of, is the odious Bill 45 -- the Public Sector Services Continuation Act, which effectively banned free speech by all Albertans if they happened to feel like advocating a public service strike.

This bill was given Royal Assent on the same day as Bill 46 -- December 11, 2013, another December day that shall live in infamy -- but was never proclaimed by the chicken-hearted Redford Tories, presumably to make it harder for the courts to get their hands on its self-evidently unconstitutional restrictions on free expression.

With Bill 46 on the floor where it belongs, one hopes Prentice will soon drop his party's other remaining legislative shoe as well.

This post also appears on David Climenhaga's blog, Alberta Diary.

By David J. Climenhaga

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David Climenhaga, author of the Alberta Diary blog, is a journalist, author, journalism teacher, poet and trade union communicator who has worked in senior writing and editing positions with the Toronto Globe and Mail and the Calgary Herald. His 1995 book, A Poke in the Public Eye, explores the relationships among Canadian journalists, public relations people and politicians. He left journalism after the strike at the Calgary Herald in 1999 and 2000 to work for the trade union movement. Alberta Diary focuses on Alberta politics and social issues.