Saturday 25th May 2019

Resource Clips


Posts tagged ‘oil’

Alberta Premier Jason Kenney vows to counter a U.S.-backed campaign against the province’s resources

May 23rd, 2019

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B.C. minister of energy and mines Michelle Mungall exaggerates deeply in a Black Press interview

May 10th, 2019

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Vivian Krause discusses her one-person campaign to expose wealthy American interests bankrolling Canadian environmentalists

April 26th, 2019

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Alberta fights back

April 16th, 2019

New government promises bold measures to defend a resource-based economy

by Greg Klein

Updated results (seats at dissolution shown in parentheses)

  • United Conservative Party: 63 seats, 55.2% of the popular vote (25 seats)
  • New Democratic Party: 24 seats, 32.2% (52 seats)
  • Alberta Party: 0 seats, 9.2% (3)
  • Liberal Party: 0 seats, 1% (1)
  • Independent candidates: 0 seats, 0.5% (3)
  • Freedom Conservative Party: 0 seats, 0.5% (1)
  • Progressive Conservative Party: 0 seats, 0% (1)
  • (One vacant seat at dissolution)

 

The outcome wasn’t as surprising as last time, when the once-marginal New Democratic Party swept to power in what had long been a moderately conservative one-party province. Yet this was probably Alberta’s most dramatic election since 1935, when a victorious upstart tied to the economic movement known as Social Credit grabbed international attention. Rarely has Western alienation played out so strongly as in this campaign, provoked by Ottawa’s stance on, among other issues, the ongoing war against Canadian resource industries. Foreign interference in the form of U.S. money also came to light, while aspects of the culture wars helped inflame passions.

The new government promises bold measures to defend a resource-based economy

Back in the ’30s, however, William Aberhart’s Social Credit failed to enact the radical reforms intended to deal with the Great Depression. The results of incoming premier Jason Kenney’s bold talk remain to be seen, despite the overwhelming victory of his United Conservative Party. Kenney’s biggest challenge will be to overcome the opposition to pipelines and tankers that deprives Albertan oil producers of Asian markets and consequently much higher prices.

Certainly Kenney won a decisive mandate. Barely half an hour after polls closed, media projections called a UCP majority. The party comprises a 2017 merger of the Progressive Conservatives and Wildrose Party, which together polled 52% in 2015, compared with only 40.6% for the NDP. But that year the New Democrats took 54 of 87 seats.

Much of Kenney’s success came from his portrayal of “the Trudeau-Notley alliance,” in which he blamed the prime minister and incumbent premier for wrecking Alberta’s economy through a combination of appeasement, indifference and outright animosity. Notley, at best an ineffectual supporter of Alberta oil and at worst an ideological enemy, made an easy target. So did Justin Trudeau, struggling with an image tarnished by SNC-Lavalin, that scandal’s revelation of favouritism towards Quebec jobs, and policies towards Alberta jobs that evoked memories of his father’s National Energy Program, often blamed for wrecking Alberta’s economy during the 1980s.

The new government promises bold measures to defend a resource-based economy

Kenney found easy targets in the “Trudeau-Notley alliance”
but victory might give him tougher battles to fight.
(Image: United Conservative Party)

Allusions to the NEP surfaced in Kenney’s description of Bill C-69, “the Liberals’ ‘No More Pipelines’ Law” and “a federal sucker punch to an already-reeling Alberta economy.” Kenney promised a constitutional challenge.

He portrayed Notley’s opposition to Ottawa’s Bill C-48, banning oil tankers from northern B.C. ports, as an insincere and tardy effort.

Kenney committed to ditch Notley’s carbon tax and sue Ottawa if it tries to impose the federal carbon tax on Alberta, as Trudeau’s government has done to provinces that didn’t enact their own carbon taxes.

Addressing an especially sore point for Albertans, Kenney promised a referendum on equalization. Consistently punishing Alberta through good economic times and bad, the inter-provincial transfers of money consistently benefit Quebec through bad times and good.

Turning his confrontational stance westwards, Kenney vowed to take on Trans Mountain pipeline foe British Columbia “on day one” by proclaiming Alberta’s Turn off the Taps legislation. Also known as Bill 12, it would stop Alberta oil shipments to an Alberta oil-dependent province that opposes exports of Alberta oil to Asia. B.C., on the other hand, stands ready to defend its convenient ethics in court.

Kenney also vowed action on foreign funding in Canadian campaigns. The issue gained prominence just days before the vote, with an April 12 Financial Post article by researcher Vivian Krause. American money, she stated, was helping finance efforts to defeat UCP candidates, part of a much wider, ongoing U.S.-funded campaign to “landlock” Albertan oil and gas, as well as destroy other Canadian resource industries.

From the very beginning, the campaign strategy was to land-lock the tar sands so their crude could not reach the international market where it could fetch a high price per barrel.—Tar Sands Campaign
director Michael Marx,
as quoted by Vivian Krause

According to documents she’s made public, foreign money moved from activism and court challenges to specifically anti-UCP efforts that benefit the NDP.

A group called Progress Alberta was working against UCP candidates, while another group called Leadnow urged its supporters to join Progress Alberta’s anti-UCP efforts, she stated. Referring to U.S. tax returns, Krause reported that “both Leadnow and Progress Alberta are partially funded—US$62,843 (2016-2017) and US$162,587 (2013-2016) respectively—by the Tar Sands Campaign.” The Tar Sands Campaign gets its money from the Rockefeller Brothers Fund, she added.

Krause quoted Tar Sands Campaign director Michael Marx as stating: “From the very beginning, the campaign strategy was to land-lock the tar sands so their crude could not reach the international market where it could fetch a high price per barrel.”

Krause charged that Notley knew about the foreign-funded activity but refused to act.

Kenney was quick to follow up. “We now know that for months Rachel Notley has been sitting on a legal opinion indicating that the government of Alberta could take action against groups behind the Tar Sands Campaign,” he declared. “Some have estimated that Alberta is losing up to $16 billion a year in value from the price discount that results from our oil producers being captive to the U.S. market. This is a direct result of the campaign to landlock Canadian energy supported by the Tar Sands Campaign, which in the last year has succeeded in delaying the Trans Mountain Expansion, Keystone XL and the Line 3 replacement project.”

Some have estimated that Alberta is losing up to $16 billion a year in value from the price discount that results from our oil producers being captive to the U.S. market. This is a direct result of the campaign to landlock Canadian energy supported by the Tar Sands Campaign.—Jason Kenney

Kenney pledged to challenge the charitable status of foreign-funded groups, cut off their provincial funding, hold a public inquiry into foreign funding that attacks Albertan energy, ban foreign entities from financing political action committees and urge Ottawa to pass Bill S-239, which would ban foreign money from federal politics.

Krause has previously stated that Rockefeller money helped fund Leadnow’s anti-Conservative campaign in the 2015 federal election.

Now that a provincial government intends to act on her findings, something that started as a Quixotic one-woman campaign could have enormous impact. According to her figures, U.S. interests like the Rockefellers have paid Canadian activists well over half a billion dollars so far.

Of course the extent to which Kenney’s tough talk produces results remains to be seen. Still Notley had nothing to show for any claim of supporting Alberta resources. Kenney found it easy to associate her with the prime minister, the UCP’s continual target. The anti-pipeline Bill C-69 “is just one of the terrible consequences of the Trudeau-Notley alliance,” Kenney argued. “Alberta’s NDP gave Justin Trudeau licence to kill Northern Gateway, to surrender to a U.S. veto of Keystone XL, to change regulations that led to the death of Energy East and to fold in the face of the B.C. New Democrats’ obstruction of the Trans Mountain expansion. On top of that we’ve got Trudeau’s tanker ban, Bill C-48 and a cap on our oilsands.”

Krause pointed out that heavy-handed enviro-activism persisted despite Notley’s attempts at appeasement. The NDP increased the carbon tax, capped allowable emissions and created the world’s largest boreal forest preserve. “Surely the campaign against Alberta would finally be over,” Krause wrote. “But, again, no.”

The UCP victory adds considerable weight to moderate conservative provinces, now stretching from Alberta to Ontario and including New Brunswick. Along with the federal Conservatives, they could present troublesome interference to the federal Liberals’ re-election efforts in October. In fact as a six-term MP who served a number of cabinet positions in Stephen Harper’s Conservative government, Kenney could overshadow federal Conservative leader Andrew Scheer.

On the other hand, a strong conservative bloc might discourage the Liberals from almost any interest in economic issues, thereby freeing them to campaign exclusively on their Trudeauvian zeitgeist.

Deep thoughts from B.C.’s energy and mines minister

April 12th, 2019

by Greg Klein | April 12, 2019

Proving they could sink lower than anyone else, Russians spent 24 years drilling their world-record 12,261-metre Kola Superdeep Bore Hole. But northeastern British Columbia’s oil patch seems to have reached something like 25 times as far. And in doing so, they must be employing super-durable materials impervious to intense heat and pressure but unknown to the outside world.

Deep thoughts from B.C.’s energy and mines minister

A reference work for B.C. cabinet ministers?

Or so you might think on reading a comment by B.C.’s minister of energy, mines and petroleum resources, Michelle Mungall.

Discussing the natural gas industry, she told Black Press legislative correspondent Tom Fletcher, “In B.C. we’re drilling about 300 kilometres below the surface.” That would mean reaching about 5% of the distance to the planet’s hot, liquid inner core and well within temperatures that would melt any metal known to mankind.

“Wildly inaccurate,” Fletcher responded. “In fact, the gas and petroleum liquids-rich Montney shale formation that runs under Fort St. John, Dawson Creek and into Alberta is from two to four kilometres deep, similar to the Marcellus shale in the U.S.”

But if Mungall knows something that isn’t common knowledge, numerous possibilities arise, and not just in mining and geothermal energy. If drilling’s possible at such fathomless depths, why not tunneling and why not continue right through the globe to the Southern Hemisphere? That might open up trade links to compete with China’s Belt and Road Initiative.

Meanwhile borehole champion Russia, always vain about its accomplishments and now along with China officially considered a security threat to Canada, no doubt will be watching closely for any credible signs of one-upmanship in a downwards direction.

‘The Asian century’

April 4th, 2019

East has surpassed West, whether the West knows it or not, says Peter Frankopan

by Greg Klein

East has surpassed West, whether we know it or not, says Peter Frankopan

“Silk roads” can refer to the process of connecting people and cultures
through trade, according to Peter Frankopan’s recently published book.

 

Less than two years ago tensions along an especially sensitive border area sparked fighting between Chinese and Indian troops. Outside Asia, who knew? “As most of the world focused on the Twitter account of the US president and the circus surrounding Brexit, the threat of the two most populous countries on earth going to war was not just a possibility, it looked like becoming a fact,” writes Peter Frankopan. An uneasy truce eventually stalled hostilities but the West’s ignorance of the wider world remains. That’s both symptom and cause of the West’s decline, the author says.

The decisions being made in today’s world that really matter are not being made in Paris, London, Berlin or Rome—as they were a hundred years ago—but in Beijing and Moscow, in Tehran and Riyadh, in Delhi and Islamabad, in Kabul and in Taliban-controlled areas of Afghanistan, in Ankara, Damascus and Jerusalem. The world’s past has been shaped by what happens along the Silk Roads; so too will its future.—Peter Frankopan

Relatively few Westerners realize the extent of China’s Belt and Road Initiative. Actually a complex suite of alliances concerning resources, infrastructure, trade, security and even culture, the BRI forms just part of an Asian awakening that’s shifting the planet’s centre of importance while strengthening Eastern influence beyond Asia and Africa to make inroads into Europe, the Americas, the Arctic, cyberspace and outer space.

That’s the message of historian Frankopan’s latest book, The New Silk Roads: The Present and Future of the World. While present and future aren’t normally the precinct of historians, it was historical perspective that brought Frankopan to the topic. In context, Western global supremacy has been a recent, short-lived development.

Since announcing the BRI in 2013, China has promised nearly $1 trillion, mostly in loans, for about 1,000 projects, Frankopan reports. That money could “multiply several times over, to create an interlinked world of train lines, highways, deep-water ports and airports that will enable trade links to grow ever stronger and faster.”

That would enhance China’s access to, and control over, resources ranging from oil and gas to mines and farmland; provide markets for Chinese exports including surplus steel, cement and metals, as well as manufactured goods; create projects for Chinese contractors; secure foreign ports and other strategic commercial and military locations; and build closer foreign alliances for geopolitical as well as economic benefits.

Backed by Chinese money and local sovereign debt, Chinese companies have pushed roads, railways, power plants, grids and pipelines through Africa and Asia at a much faster rate than ever seen through Western aid. Of course that can put the supposed beneficiaries at the mercy of their Chinese creditors.

East has surpassed West, whether we know it or not, says Peter Frankopan

In 2011, for example, China forgave neighbouring Tajikistan’s infrastructure-related debt in exchange for several hundred square kilometres of territory. A $7-billion rail line in Laos represents over 60% of the country’s GDP. A rail-building boom in Angola left citizens with a per capita debt to China of $754 out of a per capita income of $6,200. In 2017 a Chinese company got a 99-year lease in lieu of debt on the Sri Lankan port of Hambantota, a strategic site for both commercial and military reasons. Other ports in Maldives, Vanuatu, the Solomon Islands and Djibouti could face a similar fate.

Even so, something like 85% of BRI projects “have proceeded without difficulty,” Frankopan states. China conducts many of its most opportunistic acquisitions openly, like buying a controlling interest in Piraeus, the Athenian port since antiquity. Other seaport purchases have taken place in Spain, Italy and Belgium.

Strategic ports and an alliance with Pakistan help position China in the Indian Ocean, while China continues to expand its South China Sea presence by building artificial islands for military bases. This isn’t just “the crossroads of the global economy” but a ploy to extend military power thousands of miles farther, according to a U.S. Navy admiral. China’s ambitions continue in the disputed East China Sea, location of the 2010 Senkaku conflict, in which China’s rare earths tactics demonstrated yet another weapon in the country’s arsenal.

As an economic powerhouse as well as a “geopolitical alternative to the US,” China can profit from American sanctions on countries like Iran. Russia too challenges U.S. policies towards countries like Saudi Arabia and Turkey, while the latter shows its willingness to trade with Iran and buy arms from Moscow.

Military co-operation can create unlikely allies. Last summer, in Russian’s largest war games since 1981, Beijing contributed 30 fighter jets and helicopters along with more than 3,000 troops. Included in the exercises were simulated nuclear attacks.

While futurologists and networking pioneers often talk about how the exciting world of artificial intelligence, Big Earth Data and machine learning promise to change the way we live, work and think, few ever ask where the materials on which the digital new world [depends] come from—or what happens if supply either dries up or is used as a commercial or a political weapon by those who have a near-monopoly on global supply.—Peter Frankopan

Even India, America’s strongest Asian ally and the Asian country most wary of Chinese expansion, stands to undermine U.S. influence with proposed transportation connections and free trade with Iran and Afghanistan.

Yet obvious perils weaken any notion of a united Asia working harmoniously towards a common goal. Russian-Chinese military co-operation doesn’t preclude Moscow stationing its 29th Army 3rd Missile Brigade, with nuclear missile capabilities, near the Chinese border.

Time will tell whether other countries can overcome the Eurasian chaos that inspired this maxim of Canadian miners: “Never invest in a country with a name ending in ‘stan’.”

Then there’s extremist Islam. Uighurs from western China have fought in Syria for the Islamic State in numbers estimated “from several thousand to many times that number.” China risks wider Muslim anger by running a gulag archipelago for Muslims. The country’s Xinjiang Uygur Autonomous Region hosts “the largest mass incarceration of a minority population in the world today.”

Oddly enough for someone who knocks Western insularity, Frankopan seems to share the current preoccupation with the U.S. president. Among Frankopan’s criticisms of the West is its supposed opposition to immigration, even though that’s a marginal position within liberal countries but official policy in most of the East.

Nor does Frankopan mention the weird ideological zealotry that threatens to destabilize if not destroy the West from within.

Still, history’s greatest value might be perspective on the present. This historian’s view of the present and future can help Westerners understand their not-so-esteemed status in the Asian century.

American machinations

March 23rd, 2019

Vivian Krause exposes U.S. money and tactics behind Canadian environmentalism

by Greg Klein

This isn’t the kind of Yankee imperialism Canadian protesters typically protest. Powerful American interests pay Canadian environmental activists big, big money—well over half a billion dollars so far—that does nothing for the environment but undermines our economy and national unity. That’s Vivian Krause’s message and, as the pipeline controversy gains intensity, her story’s gaining prominence. But, she argues, Ottawa still shows no intention of using its power to stop this foreign interference.

The money trail begins with huge American backers that include the Gordon and Betty Moore Foundation, the Rockefeller Brothers Fund, the William and Flora Hewlett Foundation, and the David and Lucile Packard Foundation, she says.

Vivian Krause exposes the U.S. money behind Canadian environmentalism

They fund intermediaries like the Oak Foundation, Tides Canada and its U.S.-based parent organization the Tides Foundation.

The intermediaries, in turn, channel money to Canadian groups like the David Suzuki Foundation, Greenpeace Canada, the Pembina Institute, West Coast Environmental Law, the Dogwood Initiative, several first nations and the Council of Canadians, supposedly founded as a nationalist group to protect Canadian sovereignty.

Some examples? The Moore Foundation alone, she says, has pumped $259 million into Canada through more than 500 payments averaging about half a million each. Tides got $83 million. “West Coast Environmental Law, for example, receives on a monthly basis between $25,000 and $100,000 just from this one foundation.” Some first nations got $58 million in 99 payments averaging $580,000 each.

Backed by U.S. bucks, the beneficiaries go after Canadian resource industries, especially Alberta oil production, focusing on proposed Canadian pipeline projects and oil tanker traffic. Oddly excluded from the concerns of American funders and Canadian protesters are American oil production and American tanker traffic—even the American tankers that navigate British Columbia’s coast.

Ready to reveal sources, her website links to tax returns, policy papers and other documents to substantiate her message. Not only does she expose so much of their funding, but she also disputes the truthfulness of some of their key statements. Working “from my dining room table, using Google on my own nickel,” Krause single-handedly challenges an extremely well-funded and vocal movement.

She’s been accused of shilling for the federal Conservatives and the oil industry. But that brings a spirited retort: “I did what I did in spite of the Conservative party and in spite of the oil industry,” Krause tells ResourceClips.com. “I actually did what they should have done. But none of them were doing proper issue management research. They weren’t even following this.”

Vivian Krause exposes the U.S. money behind Canadian environmentalism

Vivian Krause delivers the keynote speech at
Resource Works’ fifth anniversary celebration.

Having spent the 1990s working for UNICEF in Guatemala and Indonesia, she then took a job with one of the world’s largest producers of farmed salmon, an industry opposed by B.C. environmentalists. She happened to find documentation tracing their money and strategies to American sources. Then the money trail branched out.

“The same funders blocking farmed salmon from markets were starting to do the same to Alberta oil,” she recalls. “The tactics were the same, the funders were the same, some of the same individuals were involved.

“I worked with charities so I understand charities and charitable foundations. I worked in Indonesia, one of the most corrupt countries in the world, so I was trained to spot things that are fishy, and I also knew a resource-based industry—I witnessed the frontlines of activism against the salmon farming industry.”

As her research continued, she “couldn’t find anyone else who would do this. I kept wondering which think tank, which organization will take this over so I don’t have to do this anymore. I couldn’t find anybody.”

She acknowledges some honorariums in the past and the occasional speaker’s fee, but she remains a self-supporting individual fighting a one-person counter-campaign.

That’s against a movement that “doesn’t help the environment,” she argues. “All it does is bench Canada from the world market. And I would argue that we are one of the best oil producers. Look at what Alberta has done—they put on a carbon tax, they capped production and they created a protected boreal forest. No other oil-producing jurisdiction has done anything near that. Despite all that the Alberta government has done, they’re still being bullied out of the market. So I would argue that this anti-pipeline activism, if it intended to help mitigate the climate and environmental impacts of oil, has had the opposite impact.”

Despite all that the Alberta government has done, they’re still being bullied out of the market. So I would argue that this anti-pipeline activism, if it intended to help mitigate the climate and environmental impacts of oil, has had the opposite impact.

The American-funded campaign also intensifies the conflict between Alberta and some other Canadian jurisdictions, thereby weakening national unity, Krause says. Additionally she’s found American money intruding into Canadian election campaigns.

In one example following Canada’s 2015 federal election, she discovered the Oakland-based Online Progressive Engagement Network (OPEN) boasting that its Canadian campaign contributed “greatly to the ousting of the conservative Harper government.” Krause describes OPEN as a Rockefeller intermediary and the parent organization of Leadnow. Leadnow claimed to have defeated 26 Conservative incumbents, an obviously dubious statement, but Krause maintains the group may well have made a difference in some ridings.

So what’s Ottawa doing about this foreign interference? Nothing, Krause says. Her submissions to the Canada Revenue Agency have gone unanswered. As for Elections Canada, “I feel that they ignored crucial evidence and had they not ignored it they would have come to a different conclusion.”

Canada’s Elections Act has loopholes so big “you could drive a heavy hauler through them,” she adds. “And the amendments that the current government has proposed will not solve the problem.”

But any solution would depend on the CRA, she emphasizes. “As I was told during the Elections Canada investigation, if the Charities Directorate allows Canadian-registered charities to bring in money for those purposes, they then ‘Canadianize’ the money. And then, when those charities report the money to Elections Canada, for the purposes of Elections Canada it’s Canadian. So the CRA needs to enforce the Income Tax Act so that charities are not conducting activities that are not exclusively charitable.”

Nevertheless, she remains optimistic. For that, she credits several prominent natives for “lifting the taboo. There was a taboo on talking about this American funding. The BC Liberals, for 10 years, said we can’t fight it. They used to say, ‘They’ve got billions, we’ve only got millions. We have to go along with this Great Bear Rainforest’ [a 6.4-million-hectare West Coast environmental reserve] even though they knew that there’s no great bears in the Great Bear Rainforest.

“The taboo has been lifted. Now we can start asking for some accountability, starting with the CRA.”

Visit Vivian Krause’s website.

Watch Resource Works’ site for an upcoming video of a March 14 speech by Vivian Krause.

Rex Murphy comments on the carbon tax and Fort McMurray’s decline

March 8th, 2019

…Read more

Battlefield correspondent

January 24th, 2019

Rex Murphy sees human casualties in the war on Canada’s resource industries

by Greg Klein

Rex Murphy sees human casualties in the war on Canada’s resource industries

An SRO audience paid rapt attention to Rex Murphy’s VRIC speech.

 

There’s something inspiring about a Newfoundlander—a Newfoundlander born in Newfoundland before it even joined Canada—coming to the West Coast largely to defend Alberta’s oil and gas sector. Actually Rex Murphy’s message applies to Canada’s resource industries overall, focusing on the people who work in them, their families and others who helped build the country. He sees the chasm between those who find fulfillment in employment and those who would shut down the industries that provide it.

Rex Murphy sees human casualties in the war on Canada’s resource industries

A National Post columnist who’s somehow tolerated by the CBC, Murphy proved a huge hit with an overflow crowd at the Vancouver Resource Investment Conference 2019. “As a journalist, I’m in a room full of achievers,” he quipped. “This is a very awkward spot.” But unlike most journalists, he neither ignores nor celebrates an enormous shift in Canadian society.

He remembers miners from Baie Verte and Buchans who frequented his mother’s restaurant in the 1950s, “the gentlest of men” despite their gruelling work. But important as mining was, Newfoundland’s main source of survival was fishing. That changed dramatically in 1992.

That’s when 31,000 people, “at the stroke of a pen on a single day, were completely removed from the Newfoundland inshore fishery. Something that had gone on for 450 years, that defined the culture, the humour, the idiom, the songs, the pattern of settlement, the whole idea of Newfoundland, was wrapped up in that fishery…. For the first time in 500 years no one could jig a codfish and have it for supper. But also it was 31,000 people abruptly unemployed.”

Proportionately that would have been 660,000 people in Ontario, he added. One man he knew, desperately hoping for a job in Hamilton, sold his house for seven plane tickets. “That’s how rough it was.”

Rex Murphy sees human casualties in the war on Canada’s resource industries

But as one regional resource economy collapsed, another boomed. Alberta’s oilpatch needed workers. Murphy calls it “one of the great rescue operations of Canadian Confederation, which most people still haven’t even heard about…. It was one of the great moments, unsung, of Confederation at work, where one region of the country, very willingly, allowed a strange bunch with certainly a stranger language to wander into their province … one of the great songs that we should be singing, that the enterprise of Alberta and a primary industry rescued one of the great social and cultural blows of another part of the Confederation. Did you ever hear about it?”

We more likely heard vilification, often coming from activists, celebrities, media and increasingly Ottawa, he maintained. “You heard every criticism you could hear about poor Fort McMurray. Even after the fire they went after it…. You had the oil price decline, you had the burning of Fort McMurray, you had a flood in Fort McMurray, you had the departure of capital from Fort McMurray, you had the layoff of engineers in Fort McMurray, and what did they decide was the cure? Let’s bring in a carbon tax.

“I mean, the poor creature’s already laid out on the morgue table and they want to take another few shots at the head.”

Rex Murphy sees human casualties in the war on Canada’s resource industries

Resource extraction was vital to the generations who built this country, Murphy emphasized. “It is only in a country as prosperous as our own that we get to the point where we denigrate and derogate the essential industries that brought us precisely to where we are.”

Prosperity, or at least just simply work, can provide intangible benefits too, he pointed out.

“Do you know what it’s like not to have work? There’s no psychological stress greater except loss of a loved one or breakup of a family…. It’s not just the work, it’s not just the paycheque, it is the fulfillment of the human personality.”

Although often incredulous, Murphy’s cri de coeur falls short of actual despair, especially when laced with homespun humour. Nevertheless a despairing thought might occur to listeners who wonder whether the intangible value of an earned paycheque matters much in a culture of entitlement, or among those who find remuneration in activism. As for work’s fulfillment of the human personality, maybe another type of personality has gained prominence, one that finds fulfillment in espousing fashionable convictions and obstructing useful projects.

What remains to be seen is whether the people he speaks for are declining, in numbers as well as influence. Maybe previous generations could have offset such a fate by producing a few more Rex Murphys.

Videos of VRIC 2019 presentations will be posted online in the coming weeks by Cambridge House International.

‘The great enabler’

January 16th, 2019

A new era of energy depends on mining and especially copper, says Gianni Kovacevic

by Greg Klein

A new era of energy depends on mining and especially copper, says Gianni Kovacevic

 

Gold and precious metals can attract people seeking wealth or beauty, while diamonds and other gems convey an intrigue of their own. But who becomes downright passionate about a base metal? To those who’ve head him talk, Gianni Kovacevic quickly comes to mind. Copper’s his metal of interest but his real fascination is the future—that, and a vision of the importance this metal holds to a new era of energy history.

Chairperson of CopperBank Resources CSE:CBK, an authority on energy systems and author of My Electrician Drives a Porsche?, he’s an especially engaging public speaker who’s possibly more effective than anyone in communicating mining’s importance to non-mining people.

A new era of energy depends on mining and especially copper, says Gianni Kovacevic

The era of electrification offers promise to both
developed and emerging economies, says Kovacevic.

But those in the industry find his message captivating too. He calls mining, metals and especially copper “the great enabler” of electrification. And electrification’s the key to a new era in which copper usage will grow by magnitudes, he declares.

That’s happening already as developed countries wean themselves off fossil fuels and emerging countries use more and more electricity for consumer items and transportation or—from village to village and home to home—as they adopt electricity for the first time.

Among other vital metals are aluminum, lithium, vanadium and cobalt. “I like anything that enables electrification,” Kovacevic explains. “The sensitive one is cobalt. If people are talking about reducing cobalt in batteries or eliminating it altogether, who wins? Nickel. But no question about it, we will require hundreds of millions, in fact billions, of new battery cells.”

Overall, approximately 19% of energy use now comes from electricity, he says. But he expects the number to reach about 50% by 2050. His data for current and planned copper production, however, shows alarming shortfalls in capacity.

Half of the world’s primary copper production now comes from 25 mines. Just two countries, Peru and Chile, provide a combined 45%. One major copper mine, First Quantum Minerals’ (TSX:FM) Cobre Panama, has commissioning planned this year. Nothing else over 110,000 tonnes is expected until around 2022.

A new era of energy depends on mining and especially copper, says Gianni Kovacevic

First Quantum’s Cobre Panama will be the only
major new copper mine until about 2022, Kovacevic says.

In 2010 the 15 largest copper producers boasted average grades around 1.2%. The 2016 average was 0.72% and falling. Over the next half-century he expects average grades to slip below 0.5%.

Clearly more copper production will require much higher prices to make lower grades economic, Kovacevic emphasizes. He’s not alone in that outlook. Among others extolling the metal’s virtues is Robert Friedland, who also considers copper the key to electrification and maintains that declining grades will require higher prices.

Over the last nine months, however, prices haven’t co-operated. In late May spot copper approached a five-year high in the range of $3.30 a pound, but fell steeply after June 1. Current prices sit around $2.60 to $2.65, although that’s well above levels seen through most of 2015 and 2016. But Kovacevic says warehouse inventories suggest the market has reached a supply deficit.

Two decades of prices show an ironic connection with the commodity that fueled the previous energy era, he adds. “Copper’s never left its long-term bull market but it’s been pushed around by oil, because 90% of the time it’s correlated with oil. But now the prices have to decouple. Copper has to go much, much higher.”

Referring to himself as a “realistic environmentalist,” Kovacevic says the metals and mining crucial to the new energy era also remain crucial to emerging societies. Blocking new mines from development hinders new economies from development. “I can’t say to someone in India, for example, that they’re never going to have electricity or running water in their homes. You can’t say ‘build absolutely nothing anywhere near anyone.’ People want basic human progress. Fortunately, as we go into this new pivot of energy we’re going to bypass the old ways of receiving energy in many applications.”

Kovacevic expands on his message in an illustrated keynote speech and also hosts a lithium investment panel discussion at the Vancouver Resource Investment Conference on January 20 and 21. To avoid the $30 admission fee, click here for free registration.