Everyone is still begging the question on new pipeline projects

It may surprise you to learn that I actually enjoy the Calgary Stampede — the food, the cosplay, the parties, (almost) all of it. I enjoyed this year’s iteration more than most, given the optimism that was clearly in the air. But every time the conversation shifted to the pipeline projects that were being announced, I couldn’t help but think of a version of James Carville’s famous political maxim: It’s the economics, stupid.

For all the progress that’s been made on the political side, there is still the matter of actually making the economics of adding a massive amount of new oil production work. As I’ve written repeatedly and said all along, this is the real impediment to any new west coast pipeline (never mind Doug Ford’s ludicrous, but wonderfully named, “Northern Shield” project). It is a giant begged question hanging over the entire conversation, one that dominated this year’s Stampede.

Well, in this week’s Receipts newsletter, I try to address it — again. I talked with Kevin Birn, a vice president at S&P Global and its chief analyst for Canadian oil market, about what the economics actually look like here. I know I’m mostly whistling into the wind on this, but eventually these mundane details around costs, returns, and shareholders will have the final word.

Speaking of Stampede, I dug into one of its other familiar rituals: oil and gas executives talking out of their posterior. This time, it was Enbridge CEO Greg Ebel, who didn’t seek to know how many people were on this earth or how many were in so-called “energy poverty” but was absolutely certain that the International Energy Agency was, and is, wrong about oil demand peaking in the near future. I brought my receipts, of course.

There’s other good and fun stuff in there as well. Subscribe to the newsletter over at Canada’s National Observer if you haven’t already.