“I’m tired.”
That’s what I wrote in my notebook earlier this week, when struggling to figure out a topic for a column.
In the previous weeks I’ve engaged in countless debates online regarding pipelines, energy policy, and the sheer hypocrisy of those who decry the development and use of fossil fuels, yet use them every minute of their daily lives.
Saskatchewan Finance Minister Kevin Doherty gave notice the province must hold the line on the overall budget for public sector workers. There is no more money, because we’re in a billion dollar deficit position, pretty much entirely due to the decline in oil and potash revenue.
The Trudeau government had announced a policy to close all coal-fired power generation in Canada by 2030. My house is roughly six miles away from each of two coal-fired power stations and two mines supporting them. From my yard, I can throw a rock in three different directions and hit homes owned by two miners and one power plant worker. I figured that day our house might have dropped 20-30 per cent in value. Others I spoke to around town agreed with me.
I spent an hour talking to a drilling rig owner who feels beat up by some of the oil companies who have demanded their vendors (like him) cut their prices so much they simply can’t work at those rates. Nearly the entire fleet of independent Saskatchewan drillers is parked, yet larger, Alberta-based players have moved in to work for these rock-bottom rates. These businesses are starving, as are their people. A parked rig employs no one. An active rig feeds 21 families, from the rig personnel alone, and a similar number of support staff, if not more.
These oil companies, in turn, have been beat up by OPEC, which two years ago this week, opened up the taps and caused the greatest, and longest, oil downturn in living memory. I’ve spent two years reporting on this downturn, scraping for any positive story I could find. They have been few, and increasingly, far between.
But, within minutes of that discussion with the driller, my dour mood was uplifted.
Prime Minister Justin Trudeau took to a podium in Ottawa and announced that the Enbridge Line 3 Replacement through Saskatchewan was a go, as was Kinder Morgan’s Trans Mountain Expansion, from Edmonton, Alta. to Burnaby, B.C. A few weeks earlier, Donald Trump was elected, and this past week I’ve been reading there’s a good possibility he will approve the Keystone XL pipeline quickly, possibly as soon as his first day in office, Jan. 20. (That pipeline long ago got Canadian approval from the previous Stephen Harper government).
A Liberal prime minister named Trudeau threw his weight behind two pipelines. I’m still picking my jaw off the floor from that. He killed a third, Northern Gateway, but that proposal had some serious flaws, especially tankers traversing the long, narrow and rocky Douglas Channel to Kitimat, B.C. If Enbridge had picked Prince Rupert as the terminus, maybe it would have been a different story.
Any way you look at it, three out of four pipeline proposals likely starting construction next year is huge. I haven’t seen a major export pipeline built since 2009, and my business is, quite literally, Pipeline News.
Saskatchewan reached some sort of equivalency agreement with the federal government on coal-fired power that makes it tenable if carbon capture and storage is used. If that’s the case, perhaps our house didn’t lose $100,000 in value after all. Maybe my neighbours will keep their jobs, too.
Perhaps most importantly, OPEC, and Russia have thrown in the towel on this downturn. They’ve agreed to cut back production. Oil prices jumped 10 per cent in a day, and have continued a slow climb. In trying to drive everyone else broke, OPEC has largely hurt themselves in the process, and now they need the pain to stop.
If oil prices come up a bit more, maybe it won’t be so hard to find those positive stories. Maybe, instead of layoffs, I’ll be talking to people about hiring. Maybe, when my kids ask if we’re going on a holiday this year, I’ll be able to say, “yes.”
I’m tired, but now have reason to feel a little invigorated again. There’s hope in the air, finally.
Brian Zinchuk is editor of Pipeline News. He can be reached at brian.zinchuk@sasktel.net.
