Protesters break into Muskrat Falls hydroelectric site, form blockade outside

Protesters broke into the Muskrat Falls hydroelectric site in Labrador and formed a blockade around it, Nalcor Energy confirmed Saturday.

Nalcor spokeswoman Karen O’Neill said protesters and vehicles entered the work site near Happy Valley-Goose Bay Saturday afternoon, and a blockade of around 150 people formed outside the main entrance.

Mayor of Cartwright Dwight Lethbridge said demonstrators gained access to the site by cutting a chain off one of the gates. Lethbridge said he drove a “truckload” of people onto the site, but some protesters asked to be taken back as the situation grew “tense.”

“There was the threat of RCMP coming to arrest people and there was a helicopter flying very low over our heads,” he said. “It was a heart-pounding kind of moment.”

Lethbridge described the demonstration as “extremely peaceful.” Police were concerned that “things might escalate” between protesters and workers on the site, he said in an interview, but that has not been the case.

Protesters blocked access to the site over the last week, despite a court injunction that led to nine arrests Monday. The actions were in response to Nalcor’s confirmation methylmercury levels are expected to rise in the reservoir created by construction of the project.

The provincial government has ordered Nalcor to remove forest cover from the land that will be flooded to create the 41-square-kilometre reservoir. Critics of the project say the water will be contaminated with toxic levels of methylmercury if too many trees are left to rot at the bottom of the reservoir, raising health concerns.

Nalcor says flooding is scheduled to begin later this month, though the company tweeted Saturday it won’t happen this weekend.

A statement from Premier Dwight Ball said Nalcor would do nothing to increase water levels until a meeting with community leaders in the area that is set for Tuesday.

“We urge protesters to remain peaceful and be respectful in their actions for the safety of both themselves and workers onsite,” Ball said in the statement issued Saturday.

O’Neill said earlier Saturday that Nalcor is working to secure the site and protect the safety of “people, facilities and equipment.”

The RCMP said the main highway to Muskrat Falls was closed. Police confirmed the closure was linked to the protests and cited public safety concerns.

Lethbridge says the protesters include environmentalists, members of three aboriginal groups and nearby residents and they all have a long and varied list of demands.

“There are people here who want the project shut down no matter what,” Lethbridge said. “Personally, I think the government is a bit too far in for that … (The project) is officially a boondoggle, but they have the opportunity to make it righter than it has been.”

Courtesy: The Globe And Mail

New Climate-Friendlier Coolant Has a Catch: It’s Flammable –

LONDON — Rajiv Singh started thinking about how to do his part to fight global warming 15 years ago.

Dr. Singh, a scientist at Honeywell’s lab in Buffalo, began running computer models of tens of thousands of molecular combinations. He was seeking a better refrigerant, one of the most vexing chemicals for the environment.

Refrigerants cool homes, cars and buildings but also warm the planet at a far higher rate than carbon dioxide. Dr. Singh was searching for one stable enough to be useful but that degraded quickly so it did not linger to trap heat in the atmosphere.

“You have to hit the chemistry books,” he said in a recent interview.

As product names go, HFO-1234yf, the refrigerant he played a crucial role in developing, does not roll off the tongue. But it is one of the most important alternatives to hydrofluorocarbons, or HFCs, which have long been used in air-conditioners and refrigerators and which contribute greatly to climate change. On Oct. 15, in Kigali, Rwanda, more than 170 countries reached an agreement as part of the Montreal Protocol to curb the use of HFCs.

But Dr. Singh’s new coolant is also controversial, with critics questioning its safety and viewing it as the latest attempt by large chemical companies to play the regulatory system to their advantage. HFO-1234yf is already becoming standard in many new cars sold in the European Union and the United States by all the major automakers, in large part because its developers, Honeywell and Chemours, have automakers over a barrel. Their refrigerant is one of the few options that automakers have to comply with new regulations and the Kigali agreement.

It has its detractors. The new refrigerant is at least 10 times as costly as the one it replaces.

A number of rival manufacturers have filed suits to challenge the patent. Officials in India, which has a fast-growing car market, are deliberating over whether to grant patent protection.

And then there is the safety issue.

Daimler began raising red flags in 2012. A video the company made public was stark. It showed a Mercedes-Benz hatchback catching fire under the hood after 1234yf refrigerant leaked during a company simulation.

Daimler eventually relented and went along with the rest of the industry, installing 1234yf in many of its new cars. But the company has developed an alternative using carbon dioxide that is being introduced in its S-class cars and some E-class models, with an eye toward further expansion.

In a statement, Sandra Gödde, a spokeswoman for Daimler, said 1234yf had “different flammability properties” than the HFC coolant it was replacing, which is considered to be nonflammable. The company has developed “specific measures in order to guarantee our high safety standards,” she added, including “a specially developed protective system.”

Some engineers and environmentalists, however, say 1234yf is not a good option.

“None of the people in the car industry I know want to use it,” said Axel Friedrich, the former head of the transportation and noise division at the Umweltbundesamt, the German equivalent of the Environmental Protection Agency. He added that he opposed having another “product in the front of the car which is flammable.”

Dr. Friedrich, an engineer and a chemist, is also a member of the scientific advisory council of the International Council on Clean Transportation, the group that commissioned the tests that exposed Volkswagen’s cheating on diesel emissions. He collaborated on tests of 1234yf with Deutsche Umwelthilfe, a German environmental group, which also raised fire concerns. While cars, obviously, contain other flammable materials, he was specifically worried that at high temperatures 1234yf emitted hydrogen fluoride, which is dangerous if inhaled or touched.

“I wouldn’t like to use it as a car owner, because it gives me a higher risk and higher cost,” Dr. Friedrich said. “It’s a really unfair solution by the car industry. This is not what government and society should have accepted.”

Honeywell and Chemours (which until last year was a unit of DuPont) have been adamant that the product is safe, and they are not alone. After the Daimler issue emerged, SAE International, an engineering consortium that includes all of the major automakers, said 1234yf was “highly unlikely to ignite,” though the issue led to a brief split with German automakers. The Joint Research Center of the European Union has also said there was “no evidence of a serious risk.” It is being used across the auto industry and has gained approval from regulators in the United States and Europe.

“Daimler was the only manufacturer that cited an issue,” said Ken Gayer, vice president and general manager of Honeywell Fluorine Products.

“All other car manufacturers at the time had incorporated 1234yf, which is mildly flammable, into their designs, with modest design changes, and proven to themselves conclusively that they could safely use the product,” he said.

Daimler’s concerns led to a reassessment. “The entire industry stepped back and said, ‘Could we possibly have missed something?’” Mr. Gayer said. “We reviewed all the work we did, and we also ran new tests to try to understand better what Daimler’s issue was.”

At the end of that process, automakers and regulators “proved to themselves conclusively once again that 1234yf was safe for use in cars, and then finally in 2015 Daimler announced publicly that they would use the product,” Mr. Gayer said.

Chemours said in a statement that the additional testing proved any “concerns to be unfounded.” It added, “Today, all major global automakers around the world are using HFO-1234yf.”

One thing is not in dispute. The new coolant is superior to the HFC it is replacing in its impact on global warming. Hydrofluorocarbons have roughly 1,400 times the impact of carbon dioxide, the baseline used to measure such chemicals. By contrast, 1234yf has only four times the impact.

Because of that, perhaps no single chemical is better positioned to take advantage of the Kigali agreement. While Honeywell and Chemours, when it was part of DuPont, lobbied to weaken and stall HFC regulations in the past, this time they were poised to profit from a product that had fresh patent protection, and they largely embraced the agreement.

Though Honeywell would not give specific profit or revenue figures for 1234yf, sales of its HFC alternatives have helped the company raise annual revenue from its wider fluorine business by double-digit percentages in the last few years to more than $1 billion.

The companies, which sell products under different brand names, have “almost a monopoly,” said Stephen O. Andersen, a former E.P.A. official who has been a representative to the Montreal Protocol and works for the Institute for Governance and Sustainable Development, an advocacy group.

“The price of the product is very high, about $80 a kilogram, and so that adds up to about $50 to $75 per car, which is a lot of money compared to the HFC they were using,” which he said was about $4 to $6 a car. “So it’s a big shock, and it’s been a lot of controversy.”

David Doniger, director of the Climate and Clean Air Program at the Natural Resources Defense Council, said, “The safety concern is bogus.”

“The main concern is its high price,” Mr. Doniger said. “While a small part of the price of a car, this could be concerning when repairs are needed.” He said the price would decline after the patents expired, though that will take years.

The conundrums and controversies highlight the complexities of refrigerants and the trade-offs inherent in the fight to curb global warming. In the 1980s, the Montreal Protocol led to the ban on chlorofluorocarbons, CFCs, because of hazards to the ozone layer. They were replaced by HFCs, which are being curbed because of their effects on the climate.

Will 1234yf be an equally transitory fix? “Nothing lasts forever,” Dr. Singh, the Honeywell chemist, said. “At least a couple generations.”

Dorothee Saar, head of the transport and clean air team at Deutsche Umwelthilfe, the environmental group, said the new refrigerant presented considerable safety risks. She has her own solution. Ms. Saar, who lives in Berlin, has an old Volkswagen Golf without air-conditioning.

“I can always open a window,” she said.

Courtesy: The New York Times

Essar Global teams up with Cargill in bid for U.S. Steel Canada

The former parent company of Essar Steel Algoma Inc. is teaming up with agriculture and industrial giant Cargill Inc. to renew its bid to buy U.S. Steel Canada Inc., sources familiar with the companies’ plans say.

Essar Global, which made a public bid for U.S. Steel Canada in August, is trying to jump ahead of Bedrock Industries LP, which has been anointed by the Ontario government as the favoured bidder to take the troubled steel company out of protection under the Companies’ Creditors Arrangement Act.

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Tourmaline to buy Shell gas assets in Alberta, B.C. for about $1.4-billion

Tourmaline Oil Corp. is buying Alberta and northeastern British Columbia natural gas assets from Royal Dutch Shell PLC for $1.4-billion in cash and stock in the latest sign of growing optimism in the hard-hit energy sector.

Tourmaline, led by Calgary oil man Mike Rose, said it is acquiring production of nearly 25,000 barrels of oil equivalent a day in the Alberta Deep Basin and Montney formations. It will pay $1-billion in cash and the rest in Tourmaline shares.

The deal will immediately boost its production by about 13 per cent and add proved plus probable reserves of 474 million barrels of oil equivalent, it said. Shell said it will still have a large shale position in Canada following the close of the transaction.

To help fund the acquisition, Tourmaline is issuing $635-million of common shares in a private placement, and is selling another $100-million in stock in a bought deal to underwriters led by Peters & Co. Ltd. The shares are being offered at $34.75 apiece, a 4.5-per-cent discount to Tourmaline’s closing price of 36.39 on the Toronto Stock Exchange on Thursday.

The acquisition and stock issue add to growing activity in the oil patch as crude prices gradually recover, following two years of retrenchment in the industry. Last month, Encana Corp. issued more than $1-billion (U.S.) in stock to fund increased drilling in the Permian Basin of Texas. That deal was on the heels of a $650-million (Canadian) offering by Crescent Point Energy Corp.

Tourmaline said it expects to more than double production from the new assets by 2018. As part of the deal, it will get three gas plants and nearly 720 kilometres of pipeline, it said.

Editor’s note: The online version of this story has been corrected to reflect the fact that the assets being acquired are in Alberta and B.C.

Courtesy: The Globe And Mail

Oil steadies after early loss on dollar; U.S. rig count awaited

Oil prices steadied on Friday as the dollar eased off eight-month highs ahead of U.S. oil rig count data that would show whether drilling was on the upswing with crude trading above $50 a barrel.

Russia’s reiteration of its commitment to join OPEC in curbing output helped support crude, although some viewed signs of a post-Soviet high in crude production as bearish.

Brent crude was up 20 cents at $51.58 a barrel by 11:30 a.m. EDT. It slid as much as 26 cents earlier.

U.S. West Texas Intermediate crude was down 3 cents $50.60. It fell more than 40 cents at the session low.

“The dollar is driving much of the moves again today and there’s some caution before the rig count data, though I don’t think there’ll be any real bearish impact if this week’s rig additions come in at below 10,” said Phil Flynn, analyst at the Price Futures Group brokerage in Chicago.

The dollar hit February highs against a basket of currencies on speculation of a U.S. rate hike before the year-end. A stronger dollar makes greenback-denominated commodities, including oil, less affordable to holders of other currencies.

The market will be on the lookout for a weekly reading on the U.S. oil rig count at 1:00 p.m. EDT (1700 GMT). Oil services firm Baker Hughes, which issues the data, has reported steady rig rates or additions for 16 straight weeks.

Some analysts think oil drillers will ramp up activity soon with crude rising above $50 this month. Others say it will take more time to get the double-digit rig additions that will significantly boost production.

Russian Energy Minister Alexander Novak said he would make proposals to his counterpart from OPEC leader Saudi Arabia this weekend on price-supportive measures that could include an oil production freeze.

Oil prices are up about 13 per cent since the Organization of the Petroleum Exporting Countries announced on Sept. 27 its first planned output cut in 8 years to rein in a global glut that halved prices from mid-2014 highs above $100 a barrel.

But Novak also said Russia will produce 548 million tonnes (11 million barrels per day) of oil next year, a post-Soviet record.

“A freeze at all-time record level is not necessarily the tonic necessary to support prices,” said David Thompson, executive vice-president at Powerhouse, an energy-specialized commodities broker in Washington.

Courtesy: The Globe And Mail

Precision Drilling narrows loss while revenue sinks

Precision Drilling Corp. had a $47-million net loss for the third quarter as revenue declined 45 per cent from last year.

The loss amounted to 16 cents a share, which was an improvement from the Calgary-based drilling company’s 2015 third-quarter loss of $87-million or 30 cents a share.

Revenue declined in all of Precision Drilling’s operations, with the total falling to $202-million from $364-million in the third quarter of 2015.

The company’s adjusted earnings were down 63 per cent from last year, dropping to $41-million from $111-million. Revenue per operating hour dropped to $599 from $786, a decline of nearly 24 per cent.

Despite the bleak results in the quarter ended Sept. 30, Precision Drilling’s chief executive says customer sentiment has improved along with strengthening commodity prices.

“This improved outlook is evident in the conversations we are having with customers, but more importantly in our activity increases, recent contract bookings and improving pricing environment,” Precision Drilling president and CEO Kevin Neveu said in a release Friday.

“During the third quarter, we gained visibility through rig commitments in both the U.S. and Canada and report seven rig years added to our 2017 contract book, bringing average rigs under contract for next year to 42.

“With 37 rigs operating in the U.S. today, our activity is up 70 per cent from second quarter lows, while the industry increase is approximately 35 per cent. We believe our market share increase and contract additions reflect both the desirability of Precision’s high performance Super Triple rigs and our customers’ improving outlook.”

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Energy East pipeline ‘will happen,’ but taking too long: Arthur Irving

The chairman of Irving Oil confidently predicted Thursday the proposed Energy East Pipeline still being examined by federal regulators “will happen,” though he thinks the process is taking too long.

Arthur Irving said Thursday that Alberta’s struggling economy urgently needs the pipeline to transport its crude oil, and his firm is eager to partner with TransCanada to build a deepwater terminal in the Bay of Fundy.

“That will happen, but it’s taking a little longer than it should. But it will happen because it’s the right thing to do for Canada. They can’t get along without it. Alberta needs it and the East Coast needs it,” he said during a speech.

The Saint John, N.B.-based businessman, made his comments while announcing his company’s completion of its Halifax harbour terminal – and as the regulatory process for the pipeline emerges from controversy.

The National Energy Board panel reviewing the proposal was recused last month after it became known publicly that two of the three panellists met last year with former Quebec premier Jean Charest, then a consultant for project proponent TransCanada.

Natural Resources Minister Jim Carr has said appointing new panellists means the review period for the project could be delayed, as could the NEB’s goal of having a decision on Energy East by March 18, 2018.

On Thursday, Carr also announced the appointment of four temporary members to the National Energy Board, saying they would travel along the proposed Energy East pipeline route to carry out enhanced community and Indigenous engagement.

Irving said he was recently in Alberta and observed the oil-rich province’s economic struggles, saying it needs a way to transport its product to the ocean for export.

“That pipeline will be built because Alberta has to have it. … Calgary misses the pipeline now,” he said.

The 4,500-kilometre pipeline would cost $15.7-billion and carry 1.1 million barrels of oil per day from Alberta to New Brunswick. About two-thirds is already in place as a natural gas pipeline.

Following Irving’s comments, the Nova Scotia energy minister also weighed in, saying the province intends to tell senators holding hearings in Halifax on Friday that the project is a good one for Atlantic Canada.

“I’ll be making a presentation to the Senate committee … to indicate our premier and our government support the Energy East Pipeline and see it as part of our energy security here in Nova Scotia,” said Michel Samson.

However, Stephen Thomas, energy campaign co-ordinator with the Halifax-based Ecology Action Centre, said it’s a bit early to be declaring victory for the proposal.

“We think it’s inappropriate that a proponent in an ongoing regulatory process will make a prediction about how it’s going to go. That’s quite telling about the process itself,” he said in a telephone interview.

Thomas said the pipeline is strongly opposed by over 300 Quebec municipalities, the assembly of First Nations of Quebec and Labrador, a Treaty Alliance of over 50 First Nations across Canada, and many local businesses, fishermen and people who live along the shore of the Bay of Fundy.

“The bitumen in this pipeline … is set to be exported raw through the Bay of Fundy. With little gain for Atlantic Canadians, this pipeline and export project simply isn’t worth the risk,” he wrote in an email.

Irving said his company is committed to promoting the Atlantic Canadian economy, citing the firm’s $80-million investment in the Halifax terminal facility as an example.

Last year, the firm announced it would reactivate the facility, enabling the storage and distribution of gasoline, diesel, home heating oil, marine transportation fuel and jet fuel for customers in Nova Scotia.

Samson said the terminal improves energy security in Nova Scotia, where gasoline shortages created confusion and panic buying in August 2015.

At the time, delays in tanker arrivals at the nearby Imperial Oil terminal resulted in a three-day shortage in the province.

Courtesy: The Globe And Mail

U.S. shale cowboys do the unthinkable and bring mighty Saudis to their knees

The oil war is pretty much over, and Saudi Arabia lost.

How did the world’s most powerful oil producer, which set prices for decades by riding herd over the member states of the Organization of Petroleum Exporting Countries, get it so wrong?

In a word: shale. The Saudis underestimated not only the strength and flexibility of the American shale-oil industry, but also that of the financing machine behind it. American capitalism proved to be the superior fighting force.

Courtesy: The Globe And Mail

Oil-patch juniors feel pinch from National Bank’s squeeze

Barry Olson’s relationship with National Bank of Canada goes back more than a decade through two small oil companies he started. Now, the relationship is in tatters.

This month, his Calgary-based junior energy producer, Toro Oil & Gas Ltd., cancelled its credit facility with National and he won’t rush to the bank for other services in the near future either. It was the culmination of months of frustration for Mr. Olson, Toro’s chief executive officer, who says he’s been penalized by the financial institution despite the fact that he’s run his company conservatively through the oil-price collapse.

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U.S. drillers extend oil rig count recovery

The number of rigs drilling for oil in the United States this week rose by the most in two months, extending its second-best streak of no cuts into a 17th straight week, with analysts expecting more additions as crude prices hold over $50 (U.S.) a barrel.

Drillers added 11 oil rigs in the week to Oct. 21, bringing the total count up to 443, the most since February, but still below the 594 rigs seen a year ago, according to energy services firm Baker Hughes Inc on Friday.

The Baker Hughes oil-rig count plunged to a six-year low of 316 in May after crude prices collapsed from over $107 a barrel in June, 2014, to near $26 in February, 2016. But after U.S. crude briefly climbed over $50 a barrel in May and June, drillers have added 127 oil rigs. Analysts said prices over $50 were high enough to prompt energy firms to return to the well pad. About two-thirds of the rigs added since May, or 75, were in the Permian basin in West Texas and eastern New Mexico, bringing the total there up to 212, the most since November, 2015.

U.S. crude futures continued to trade over $50 a barrel for much of this week, spurred by continued talk of an OPEC production cut and a surprisingly large drop in U.S. inventories for the sixth week out of seven.

That put the front-month on track to rise for a fifth week in a row, its longest winning streak since March, gaining about 18 percent during that time.

With oil prices expected to continue rising in 2017 and 2018 amid a forecast tightening of the supply-demand balance, analysts said energy firms will boost spending on drilling.

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