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Energy

A plan to save coal, power generation, and the oil industry in southeast Saskatchewan

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From the Frontier Centre for Public Policy

By Brian Zinchuk

Stop moving to shut down Saskatchewan coal – it could be the salvation of our oil industry

What if there was a way to keep coal mining jobs in Saskatchewan, continue to produce low-cost electrical power, and extend the production of a substantial portion of Saskatchewan’s oilfields not by decades, but by generations? And in doing so, we could still dramatically reduce carbon dioxide emissions, and maybe save some money by reducing our nuclear rollout?

All of this is now possible, and it has everything to do with keeping our coal miners digging and our coal-fired power plants going, maybe even renewing them.

There was a potentially major development for Saskatchewan’s energy sector buried in Whitecap Resources Inc.’s year-end financial report released on Feb. 21. Whitecap said about using CO2 for enhanced oil recovery, “We have also recently started CO2 injection at a pilot CO2 flood into the Frobisher formation underlying the Weyburn Midale unit. We drilled two (2.0 net) producer wells and three (3.0 net) injection wells in 2023 and initiated CO2 injection in late 2023. Early results are encouraging with a notable production response coming through approximately one month after injection, increasing oil rates on the two producer wells from approximately 40 bpd to over 200 bpd, per well. Further technical analysis to determine commerciality and large-scale development is ongoing, and we will provide updates as next steps are determined.”

While the Bakken formation got all the headlines starting around 2007, the reality is in southeast Saskatchewan, very few Bakken wells are drilled these days. Most of the activity has been Frobisher wells, especially around Steelman, where it has been targeted for decades. So if the Frobisher responds well to tertiary recovery through carbon dioxide floods, it opens up a lot of possibilities for extending the life of some of Saskatchewan’s most prolific oilfields, taking recovery rates from the mid-20 per cent range to over 50 per cent.

Back in 2012, Canadian Natural Resources Limited president and CEO Steve Laut expressed interest in using CO2 for enhanced oil recovery in the Steelman Unit.

Whitecap’s initial results were not a five per cent improvement, or 50 per cent, but five times higher. That’s something everyone, including the provincial government, should take notice of. Imagine if you could increase crop production from 60 bushels to the acre to 300 bushels? Or quintuple potash or uranium production from certain mines? You’d be an idiot to not at least take a hard look at it.

I’m not suggesting it will remain anywhere close to that level, but the fact the CO2 flood in the Weyburn Unit, in the Vuggy and Marly units of the Midale formation, has already dramatically increased recovery rates and lengthened the lifespan of a field that otherwise would have long gone dry is significant. If the same process can be expanded to the much more prolific Frobisher formation, that’s a very big deal.

Even if it was a 25 per cent improvement – that’s well worth investigating.

Frobisher is a big deal

How prolific is the Frobisher?

Most of the drilling activity in southeast Saskatchewan follows a certain pattern. The majority is along the Frobisher subcrop – the edge of the formation where it pinches out, forming a structural trap. Of the 16 rigs working in Saskatchewan on March 3, it’s a good bet 10, and possibly more, were drilling Frobisher wells. The daily well report for March 3 published by the Ministry of Energy and Resources shows out of 19 wells listed that day in Estevan area of responsibility, all 19, across five oil producers, were either targeting the Frobisher. It may be a fluke all that day showed the Frobisher, but it definitely shows its significance.

So if Whitecap, which has been growing to be one of Saskatchewan’s largest oil producers, has found a way to substantially increase production from this formation, shouldn’t we take a hard look at how we can take advantage of it?

Stop the process of winding down coal

There’s one thing we should do right now – stop this idea of shutting down our coal-fired power plants near Estevan. You hardly hear SaskPower mention coal-fired power anymore. I keep hearing how those plants are getting enough maintenance to just get them to the planned phase out of 2030, but not likely a day beyond that. The way things are going, they’ll likely limp to the finish line, but not an inch past that. Similar things are said to me about the mines and their iron.

I’m suggesting we should strongly reconsider that. Pour some money into keeping both the power plants and the mines viable should we choose to extend their lives beyond 2030.

The Government of Saskatchewan and SaskPower should have some real serious discussions with Whitecap, and possibly other oil companies like CNRL, about the possibility of dramatically increasing carbon capture and producing as much CO2 as we can. That means putting carbon capture on Shand Power Station. But it could also mean either refurbishing Boundary Dam Unit 6 or, shockingly, building Shand Unit 2, and maybe even Unit 3, with High Efficiency Low Emissions (HELE) technology, designed from the ground up with carbon capture running from Day 1.

One might say that’s going to cost billions, and you’d be right. But I dare say doing so will cost less than just one 300 megawatt small modular reactor, whose price is not yet known, but previous SaskPower Minister Don Morgan said could run between $3 and $5 billion.

It’s going to take a long time to squeeze the first megawatt out of that first reactor. If everything goes to plan (and it never, ever goes to plan with nuclear), we might see the first SMR megawatt around 2034-35. Putting CCS on our existing coal fleet, and maybe, dare I say, expanding it, with HELE and CCS, could help bridge the gap in the interim until we get several SMRs up and running, and have become proficient in their operation. That’s baseload power that won’t go to zero like wind does every so often, and solar does every night.

Doing so would keep the Estevan economy rolling, not just from coal mining and power generation, but also oil production.

I’ve been writing about the Saskatchewan oil industry for almost 16 years now, and I am increasingly alarmed by the fact I haven’t seen the “next big thing,” in southern Saskatchewan. Drilling numbers keep on their slow decline. Companies like Crescent Point have largely lost interest and are pouring their capital expenditure money into exciting Alberta plays. That may be great for Alberta, but Saskatchewan needs to do something to keep things going here. That we’ve kept oil production relatively flat for the last 23 years is a small miracle. But if we don’t get a lot more new investment, it won’t stay that way.

The Sask Party provincial government a few years ago set a bold goal of increasing oil production from the current 454,000 barrels per day to 600,000 barrels by 2030. I asked Premier Moe about that in my year end interview with him last December. He said he thought it was a modest goal.

But as I pointed out to him, and Energy and Resources Minister Jim Reiter, I’m not seeing evidence of the province moving to make that happen.

This is something the Government of Saskatchewan, through its Crown corporation SaskPower, can do. If we tell the feds to stick it when it comes to shutting down coal by 2030, if we put carbon capture on existing units and even build new coal units with carbon capture, then supply that CO2 to companies like Whitecap, and maybe others like Canadian Natural Resources Limited, we could extend the life of our most prolific play in southeast Saskatchewan. We might even increase its production while we’re at it. All the while, we’d be ensuring baseload power production.

This plan’s impact would be measured in generations, not an election cycle, or a corporate quarter.

And it might also save us some money by reducing our nuclear expenditure.

But action has to be taken now. Because if we let those power plants and mines slide past the point of no return, an opportunity may be lost that we will be kicking ourselves for later.

We can’t let that happen.

Brian Zinchuk is editor and owner of PipelineOnline.ca, and occasional contributor to the Frontier Centre for Public Policy. He can be reached at [email protected].

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Ontario Premier Doug Ford Apologizes To Americans After Threatening Energy Price Hike For Millions

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From the Daily Caller News Foundation

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Ontario Premier Doug Ford apologized to Americans Tuesday after he suspended a 25% electricity surcharge that he initially said he would be “relentless” in pursuing.

Ford implemented a 25% surcharge on electricity to New York, Michigan and Minnesota on Monday, but quickly rescinded the policy and apologized to Americans on WABC’s “Cats & Cosby” radio show the following day. The tariffs were initially a retaliatory measure against President Donald Trump’s flurry of tariffs against Canada since he assumed office.

Canada is highly dependent on U.S. exports, economists told CNN, and the planned electricity surcharge would likely hurt Canada’s energy industry much more than it would the U.S., although an estimated 1.5 million homes and businesses would have been affected.

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“I want to apologize to the American people. I spent 20 years of my life in the US, in New Jersey, in Chicago. I love the American people,” Ford said. “I absolutely love them … Secretary Lutnick and President Trump are brilliant businesspeople. They are hard negotiators. We need to put this behind us and move forward and build the two strongest countries in the world.”

Initially, Ford had a much more aggressive tone when he instituted the tariffs.

“We will not back down. We will be relentless. I apologize to the American people that President Trump decided to have an unprovoked attack on our country, on families, on jobs, and it’s unacceptable,” Ford said on MSNBC in response to Trump’s hiking of steel and aluminum tariffs.

Trump, in turn, threatened to increase the steel and aluminum tariffs on Canada to 50%, with the increase going into effect the next day.

Ford then talked with Secretary of Commerce Howard Lutnick, with the premier describing the call as “productive.” Once Ford backed down on his plan to implement the export fees, Trump reversed his planned hike to 50% on steel and aluminum tariffs. Ford is expected to meet with Lutnick Thursday in Washington, D.C.

If a deal is not reached by the April 2 deadline, the tariffs will resume.

Ontario sold around 12 terawatt hours of electricity to America in 2023, with the U.S. being Ontario’s largest energy customer outside Canada. The tariff would have likely added “100$ a month” to the bill of Americans in the affected states, Ford claimed according to CNN.

The U.S. and Canada have entered into a contested debate over trade policies, with Canada announcing an additional $20 billion in retaliatory tariffs on American goods in response to Trump’s initial 25% steel and aluminum tariffs.

Trump initially gained concessions from Canada in February, forcing them to aid in curtailing the illegal fentanyl trade in exchange for a pause on a 25% general goods tariff enacted Feb. 1. However, Trump eventually let the pause expire, with the tariff resuming in March.

“Canada is a tariff abuser, and always has been, but the United States is not going to be subsidizing Canada any longer,” Trump said on Truth Social Mar. 10.

The Ontario Premier’s office did not immediately respond to the Daily Caller News Foundation’s request for comment.

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Daily Caller

Reality Finally Returns To Energy Industry

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From the Daily Caller News Foundation

By David Blackmon

Speaking at the opening day of the annual CERAWeek global energy industry gathering in Houston, Saudi Aramco CEO Amin Nasser declared plans for a government subsidized energy transition a failure, saying, “there is more chance of Elvis speaking next than the current plan working!”

He isn’t wrong, and Elvis was nowhere in sight.

Nasser began his speech by telling the audience made up largely of executives in the oil and gas industry and its contractors that, “We can all feel the winds of history in our industry’s sails again.”

Again, he isn’t wrong.

The winds of change have been blowing for well over a year now in favor of placing national energy security concerns over the rank climate alarmism that dominates the narratives surrounding this mythical transition. In fact, that shift began to become apparent at the 2023 CERAWeek gathering, as speaker after speaker emphasized the need to refocus on enhancing energy security after three years and trillions of dollars in debt-funded spending on renewables.

Now, with last November’s re-election of Donald Trump to a second presidency and the Energy Dominance agenda he brings with him, the momentum at the industry’s back is starkly obvious.

But that doesn’t mean that the world will or should abandon the expansion of other forms of energy, including intermittent sources like solar power and stationary batteries.

In this area, Nasser echoed the “all-of-the-above philosophy touted earlier in the Monday agenda by U.S. Energy Secretary Chris Wright, emphasizing a new model that “reflects the reality of growing demand and energy addition,” while bringing an end to the current practice by many activists and politicians of demonizing oil, gas, and coal.

“Ladies and Gentlemen, the world was promised many things in the current transition plan,” Nasser said. “It was like promising an energy El Dorado. And this quest was equally doomed to fail.”

Noting that the chosen alternatives to fossil fuels currently being heavily subsidized — wind, solar, green hydrogen, and electric vehicles — are unable to even account for incremental energy demands, much less replace fossil fuels, Nasser advocated for a revised effort in which alternatives play a growing role of complementing reliable, conventional energy sources. “I take no pleasure in this. But it is time to stop reinforcing failure. Indeed, as the fictions of the promised transition finally wash away, there is an historic opportunity to change course.”

Nasser’s remarks were largely echoed by Secretary Wright, who promised, “The Trump administration will end the Biden administration’s irrational, quasi-religious policies on climate change that imposed endless sacrifices on our citizens.” Wright also dismissed the previous administration’s focus on climate alarmism over energy security as myopic.

“The Trump administration will treat climate change for what it is — a global physical phenomenon that is a side effect of building the modern world,” Wright said. The energy secretary called Biden’s policies “economically destructive to our businesses and politically polarizing. The cure was far more destructive than the disease.”

Wright also bluntly explained why the Trump administration singled out offshore wind as an especially destructive element of the Biden myopia, while at the same time extolling solar and battery storage as zero-emission ideas that make sense.

Offshore wind’s “incredibly high prices, incredibly huge investment and a large footprint on the local communities, so it’s been very unpopular for people that live near offshore wind turbines,” Wright said. Touting his “all-of-the-above” approach, Wright said the administration supports anything that adds to “affordable, reliable, secure energy,” adding, “Wind has been singled out because it’s had a singularly poor record of driving up prices.”

Emphasizing the inadequacies of the subsidized alternatives to fossil fuels, Wright pointed out that there “is simply no physical way that wind, solar and batteries could replace the myriad uses of natural gas.” He also pointed out that gas currently supplies 43% of power generated on the U.S. grid, a share that is unlikely to be reduced anytime soon.

It all boils down to the simple reality that globalist plans for this government-forced transition have failed. As Nasser said, the time to “stop reinforcing failure” has arrived.

Elvis has left the building.

David Blackmon is an energy writer and consultant based in Texas. He spent 40 years in the oil and gas business, where he specialized in public policy and communications.

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