Tag: united states

More on the oil sands

Post ImageA week ago today I wrote a post explaining how I think Canada should be making a greater effort to develop and benefit from the oil sands in Alberta. Naturally, I’ve been keeping my eyes open for any news regarding the oil sands, and I’ve actually come across a couple things.

First is The Oil Sands of Alberta which aired on 60 minutes on Sunday. A couple things stood out for me:

There are 175 billion barrels of proven oil reserves here. That’s second to Saudi Arabia’s 260 billion but it’s only what companies can get with today’s technology. The estimate of how many more barrels of oil are buried deeper underground is staggering.

We know there’s much, much more there. The total estimates could be two trillion or even higher,” says Clive Mather, Shell’s Canada chief. “This is a very, very big resource.”

Very big? That’s eight times the amount of reserves in Saudi Arabia.

Clearly, there’s a lot of oil there. We just need the technology to be able to get it out of the ground for a reasonable cost! That’s key to my argument – we need to work on ways of fostering that research and development.

“I think it’s bigger than a gold rush. We’re expecting $100 billion over the next 10 years to be invested in this area – $100 billion in a population that, currently, is 70,000 people,” says Brian Jean, who represents the region in Canada’s parliament.

There’s a lot of money coming in too. More than I expected, to be honest. However, I am still not convinced that big corporations are going to be the ones who find a way to improve the technology and thus the ROI. Sure companies make progress in a lot of areas, but more often than not, it’s an individual or smaller group of individuals that find a way. Corporations then either copy or acquire.

For more commentary on the piece, The Oil Drum has a very good post with a ton of interesting comments too.

The 60 Minutes episode makes it seem as though China currently doesn’t have much interest in the oil sands, though not for lack of desire. A press release I found yesterday though tends to suggest that the country is starting to make investments:

What is certain is that global demand for oil – especially from Asia – is far outstripping the ability of companies to meet current demand and replenish their diminishing reserves. These factors are being exacerbated by global political uncertainty. The oil sands are increasingly on the U.S. radar screen as they focus on reducing their reliance on oil producing countries outside of North America. The Chinese have become increasingly involved in the oil sands with the China National Offshore Oil Corp., recently investing $150 million in MEG Energy Corp., a private company engaged in the oil sands.

In a different press release, I learned that Purvin & Gertz, an independent energy consulting firm, made available a study that analyzes the challenges and opportunities presented by development in the oil sands.

Producers face issues of growing existing and new markets for oil sands crudes. The need for diluent to transport heavy crude will increase with bitumen production. Upgrading in Alberta could reduce diluent demand, but requires major capital investment and does not eliminate the market risks associated with marketing SCO.

I’d have thought that with the increasing demand for oil there would be little or no risks associated with marketing synthetic crude oil! I’m not an expert though, so maybe I’m missing something. You can find out more on the study at the Purvin & Gertz website.

I need to dig around a little more, but I would not be surprised if much of the $100 billion that has been announced turns out to be nothing more than a foot in the door for the companies making the investments. If you’re in the oil business, you don’t want to miss out on the oil sands. In order to benefit though, we need to get better at extracting and refining the oil!

I guess one reason Canada wouldn’t be all that interested in sponsoring research and development is that so much of the oil sands has been sold to foreign investment (at least that’s how it appears). Like I said, more research is needed, but if that’s the case, it’s potentially a major loss for Canada.

Bush accepts responsibility for Iraq

Post ImageOn the eve of historic parliamentary elections in Iraq, US President George W. Bush has finally accepted responsibility for the debacle otherwise known as the war in Iraq. More specifically, he acknowledged that intelligence failed, but remained confident in his decision to go to war in Iraq.

“It is true that much of the intelligence turned out to be wrong,” Bush said. “As president, I’m responsible for the decision to go into Iraq.”

The president’s mea culpa was accompanied by a robust defense of the divisive war.

“Saddam was a threat — and the American people and the world is better off because he is no longer in power,” Bush declared, as he has before.

Too little, too late? The speech was no doubt designed to try and improve Bush’s approval rating, nothing more. As a purely political play, I’d guess it will probably go over quite well with the American public.

As far as I am concerned, Bush getting rid of Saddam was a good thing. At least we know that Bush himself will be out of power in a few years. Who knows when the tragedies Saddam carried out would have ended?

Read: Yahoo News

The Economist on Canada

Post ImageOne of the most interesting effects of a Canadian election is that in the weeks leading up to the big vote, there is an abundance of American commentary on our country. Most of the time it feels like we’re ignored by the American media, at least as far as politics are concerned, and The Economist admits as much in it’s latest print issue cover story (reg req’d):

Enormous though it is, Canada is all too easily overlooked. It may be the world’s second-biggest country by area, one of its dozen largest economies and a founding member of the G7 club of rich countries. But much of its vast land is frozen waste. Nearly all of its 32.2m people cling to a narrow belt along its border with the United States. Since it is a peaceful, prosperous-dare one say provincial?-sort of place, it rarely makes much of a splash in the world.

Doesn’t that sound like a place you’d want to live? I suppose it’s true however, much of our land really is frozen – not so sure about it being a waste though. The article goes on to outline two reasons that the United States and the rest of the world should pay more attention to Canada:

  1. “Canada, and especially its west, is one of the great storehouses of the commodities that the world needs in ever greater quantities-something China has recently noticed. New techniques mean that the tar sands of Alberta can be turned into oil at an ever-falling cost. That in turn means that Canada now claims the world’s second-largest oil reserves (behind only Saudi Arabia), in addition to a cornucopia of minerals and ten times more fresh water per head than the United States.”
  2. “The second reason to watch Canada, as The Economist has argued before, is that it is a healthy rival to the American way. To the “life, liberty and the pursuit of happiness” of the American Declaration of Independence, Canada replied with “peace, order and good government” in its founding charter.”

I don’t think I could have come up with a reason any more American than those. The threat of oil, and another country with something comparable to “the American dream.” Sounds like something straight out of the Whitehouse. The article then spends a few paragraphs discussing adscam and our political parties, before concluding:

For all of Canada’s abiding strengths, more of the same politics may not be good enough. The booming west—Alberta especially—feels ignored in Ottawa. Another independence vote in Quebec may be no more than a couple of years away. Keeping Canada cool, calm and collected is starting to look a lot harder than it did only a couple of years ago.

I can’t really argue with that, things are indeed starting to get interesting. The latest issue of the Economist, entitled “Canada’s wintry election,” includes at least five other articles on Canada and our upcoming election, so if you’re into reading all of the analysis (I’m starting to…) you might want to pick it up. You can also buy a PDF of the Survey of Canada.

Read: The Economist

China and the US

Post ImageMost of the articles I read about China (and to a lesser extent India) are pretty much the same thing. It’s almost as if there’s a cookie-cutter formula for these stories so that no one really has to write anything new. And the article I came across in the New York Times today was no different, except for one paragraph:

If finding a way out of Iraq is an immediate problem for Mr. Bush, then dealing with China’s increasingly assertive tone on economic and military issues, and with Mr. Hu’s quiet resistance to Washington’s calls for political liberalization, is a challenge that will last far beyond his presidency.

If you had to sum up relations between the United States and China in a single sentence, that would be it right now. The next president of the US will have to worry about Iraq no doubt, but I suspect China will be higher up on the list of priorities than it is now.

Read: New York Times

Why the USA needs to cede control of the Internet

Post ImageThere is a potentially major split brewing over control of the Internet, and it has been coming for quite some time. Declan McCullagh has written a great article explaining the problem and what it could mean, so I suggest reading that for some background before you continue with this post. In a nutshell though, the US currently has complete control over the Internet’s root servers and a growing number of countries don’t like it – they think control should be given to an international body like the United Nations. I agree.

Whatever role the United States played in the creation of the Internet doesn’t really matter anymore. The fact that the US Department of Defense created ARPANET which became the Internet we know and love today is irrelevant. What matters most of all is that the Internet has become a truly global network, and it needs to remain that way if we want to continue reaping its benefits.

All we need to do is think about all of the ways in which we use the Internet, and how they would be changed or affected if a split occurred. Things like sending email, or instant messages. Sharing pictures with friends and family around the world. Buying and selling things locally and abroad. Sharing information with others and learning about far away places without the local spin. All of these things would be affected if a major split occurs. All of these things would be affected if the Bush government continues to express arrogance and jealously guard its control of the Internet’s root servers, and the countries that disagree and want more control decide to create their own, incompatible root servers. It could be disastrous.

Even though I support the UN taking over control, I know it isn’t perfect. Scandals like the oil for food program cast a dark light across the organization. At the same time though, I truly believe problems like the oil for food pogram in Iraq would have happened anyway, with or without the UN. And I would point to the many successes of the organization as proof that a UN-run Internet would be better in the long run than a US-run Internet. At they very least, there would be almost no chance of a split occurring.

Many people will be quick to point out that the US has done nothing wrong thus far, and has done a fairly good job of running the Internet – and that’s true. However, the US is very quickly becoming a smaller and smaller part of the Internet as countries around the world bring their vast populations online. They deserve a voice and a hand in how the Internet is governed.

We need to ensure that the Internet continues to function for all citizens of the world, and that is why the USA needs to cede control of the Internet to an international organization.

Commander-in-Chief

Post ImageI came home from the office relatively early tonight, so I had time to catch the first episode of ABC’s “Commander-in-Chief“. Here’s the very to-the-point plotline from IMDB:

Mackenzie Allen becomes the first woman American president after she ascends to the job following the death of president Teddy Bridges.

What’s that?! Her name is Mackenzie? That’s so awesome! I have always wondered why there weren’t more characters with my name; I quite like it. She is played by Geena Davis.

Oh yeah, and she’s the first female President of the United States. As if that weren’t enough, her ascension to the Oval Office was full of controversy – she went against the wishes of the dying President who had asked her to resign. Her daughter didn’t agree with her taking the position. Lots of good storylines.

I don’t quite get the Hillary Clinton bashing though. As Allen’s husband was being shown around the “First Lady” areas, his tour-guide kept commenting on what Hillary had done and how “it didn’t go over very well”. Hillary for President, 2008!

Interesting show! I don’t know if I’ll make it a point to watch, but we’ll see.

Read: Commander-in-Chief

David Dodge on U.S. Economics

Post ImageI have read many times about the huge current account deficit in the United States, but usually from American media like The Economist, or maybe something from Europe. Never from Canada! It seems the Canadian government generally likes to keep quiet about our neighbour’s spending habits, maybe for fear of more beef or softwood lumber-like troubles. Needless to say, I was quite surprised to read today that Bank of Canada governor David Dodge had something to say on the matter:

In the text of a speech to be given at a Montreal conference, the central bank chief warned of “large, global economic imbalances that have become the subject of increasing concern” to policy-makers.

“I am referring, of course, to the persistent and growing current account deficit in the United States that is mirrored by large current account surpluses elsewhere, especially in Asia.”

Basically what has happened is that the United States has decreased their saving while most of the rest of the world has increased saving. Thus, the U.S. has become reliant on foreign borrowing, creating the large deficits that Dodge and other economists talk about (the United States actually has three deficits, international trade, current account, and federal budget). At the same time, China and other Asian nations have used their large and growing export income to soak up the American debt.

I think it’s really interesting to watch, even if the situation unfolds slowly. For some reason, it seems significant to me that Canada finally had something to say on the matter too, though I can’t put my finger on exactly why.

“At some point, they will have to be resolved. Why? For one thing, a country’s external indebtedness cannot keep growing indefinitely as a share of its GDP. Eventually, investors will begin to balk at increasing their exposure to that country, even if it is a reserve-currency country, such as the United States.

“For another thing, the buildup of foreign exchange reserves by Asian countries will, eventually, feed into domestic monetary expansion and lead to higher inflation. These imbalances will ultimately be resolved, either in an orderly, or in an abrupt, disorderly way.”

Perhaps Dodge is worried that things are heading down the path to a disorderly resolution, which would probably be bad for Canada.

Read: CBC News