CAN-USA 2025 Tariff Strife (split from various pol threads)

[Good2Golf]

Sarnia is an awkward location to reach as the pipeline must go through Michigan or (to stay in Canada) the long way around Lake Huron. Reasonable if the objective is to connect to existing refinery infrastructure. If the intent is just to put product on boats, maybe aim for Cornwall.

Let’s do both…pipeline curving back around to Sarnia (refining for internal consumer consumption in Ontario) and ALSO extending to Cornwall (transshipping to NB and exporting Eastward).

 

[Czech_pivo]

Putting this onto the pile of chips - cost of entry into the US market?

Missile-defence system for all of North America ‘makes sense’: Blair

U.S. President planning ‘Iron Dome’ shield for United States

www.theglobeandmail.com

Breaking Defense on "Iron Dome USA (NORAD?)"

Exclusive: Here's who Hegseth may task to put together Trump's Iron Dome plan - Breaking Defense

Under the draft, by Feb. 28 the chairman of the Joint Chiefs of Staff, DoD components, military departments, combatant commands and the Missile Defense Agency (MDA) are to put together three "scalable reference architectures" for "small, medium and large options" for the shield using "kinetic...

breakingdefense.com

The secret to delivering Trump’s Iron Dome program - Breaking Defense

Charles Beames lays out how the Iron Dome for America project needs to be structured in order for it to be successful.

breakingdefense.com

...

It's late in the day, but it is movement in the right direction as far as I am concerned.

That was on my Bingo Card - Ballistic Missile Defence for Canada

 

[Czech_pivo]

Doesn’t mean Canada can’t pull its head out of its ass and also work with Japan (and other Asian countries), but that will clearly need Trudeau gone and Carney needs to signal that he won’t be an O&G hater after he’s appointed PM…

Trade CDN oil/gas for Subs with the South Koreans - win for both sides.

 

[Czech_pivo]

That was on my Bingo Card - Ballistic Missile Defence for Canada

Next up - AUKUS

 

[Kirkhill]

Trump hails ‘cherished alliance’ with Japan after gas deal​

Donald Trump has expressed confidence that America’s relationship with Japan will flourish after he agreed a major energy deal the Asian economy.

Japan will soon begin importing a record amount of new shipments of American liquefied natural gas, he said.

“We’ve opened the sale of LNG immediately,” he said. “Japan in particular, we’re very happy that they’re going to start immediately,” he said.

Japanese Prime Minister Shigeru Ishiba said that Japan was also interested in importing bio ethanol, ammonia and other resources at what he called a stable price.

Last year, Joe Biden blocked new permits for LNG exports, a move cheered by climate activists.

The business case for Canadian LNG. Sell natural gas to the Americans and let them profit from its sale to Japan.

In 2022, total annual U.S. natural gas exports were 6.90 trillion cubic feet (Tcf)—

In 2022, total annual U.S. natural gas imports were about 3.02 Tcf (8.28 Bcf/d), which was about 8% more than in 2021 and the highest volume since 2017. Some of this imported natural gas may have been exported.

In 2022, about 99% of U.S. total annual natural gas imports were from Canada and nearly all by pipeline.

Natural gas imports and exports - U.S. Energy Information Administration (EIA)

Sources of U.S. natural gas imports and destinations of U.S. natural gas exports, and import and export volumes by pipelines and trucks and as LNG.

www.eia.gov

US exported 7 Tcf of Natural Gas after buying 3 Tcf of Natural Gas from Canada.

The US had a surplus of 4 Tcf. They didn't need our 3 Tcf. That merely added to their surplus available to export at a profit.

Gas sells at 16.60 in the Netherlands (TTF) and 14.52 in Japan.
The market price in the US 3.31
The market price in Canada is 2.09.

The US can buy Canadian gas cheaper than they can produce it themselves and pocket the change.

Oil Price Charts | Oilprice.com

Oilprices from around the world.

oilprice.com

 

[Good2Golf]

Trump hails ‘cherished alliance’ with Japan after gas deal​

Donald Trump has expressed confidence that America’s relationship with Japan will flourish after he agreed a major energy deal the Asian economy.

Japan will soon begin importing a record amount of new shipments of American liquefied natural gas, he said.

“We’ve opened the sale of LNG immediately,” he said. “Japan in particular, we’re very happy that they’re going to start immediately,” he said.

Japanese Prime Minister Shigeru Ishiba said that Japan was also interested in importing bio ethanol, ammonia and other resources at what he called a stable price.

Last year, Joe Biden blocked new permits for LNG exports, a move cheered by climate activists.

Almost as happy as he was after that fantastic deal he championed with his exemplary negotiating skills with Canada and Mexico, back in 2018.

 

[Fishbone Jones]

The business case for Canadian LNG. Sell natural gas to the Americans and let them profit from its sale to Japan.

Natural gas imports and exports - U.S. Energy Information Administration (EIA)

Sources of U.S. natural gas imports and destinations of U.S. natural gas exports, and import and export volumes by pipelines and trucks and as LNG.

www.eia.gov

US exported 7 Tcf of Natural Gas after buying 3 Tcf of Natural Gas from Canada.

The US had a surplus of 4 Tcf. They didn't need our 3 Tcf. That merely added to their surplus available to export at a profit.

Gas sells at 16.60 in the Netherlands (TTF) and 14.52 in Japan.
The market price in the US 3.31
The market price in Canada is 2.09.

The US can buy Canadian gas cheaper than they can produce it themselves and pocket the change.

Oil Price Charts | Oilprice.com

Oilprices from around the world.

oilprice.com

But isn't that where we are with our crude oil?

We'll have to do something. Even when PP gains power, it'll take years for us to catch up on infrastructure alone. Is the world willing to wait while we fiddle and fuck around?

 

[lenaitch]

Sarnia is an awkward location to reach as the pipeline must go through Michigan or (to stay in Canada) the long way around Lake Huron. Reasonable if the objective is to connect to existing refinery infrastructure. If the intent is just to put product on boats, maybe aim for Cornwall.

It would also depend on whether Sarnia has spare capacity and, if not, is their room for expansion (I doubt it - they're pretty hemmed in). There is also Nanticoke. I don't know about their capacity or space to expand.

Building a refinery from scratch is about $10Bn and would probably take a decade (although probably cheaper and shorter than expanding the Seaway). Do we build on as a nation (I thought PET's PetroCan was a bad idea) or expect the private market to build one which, up until now, none seem too interested. Maybe the people that fund and build these things don't see the long term return.

 

[Fishbone Jones]

It would also depend on whether Sarnia has spare capacity and, if not, is their room for expansion (I doubt it - they're pretty hemmed in). There is also Nanticoke. I don't know about their capacity or space to expand.

Building a refinery from scratch is about $10Bn and would probably take a decade (although probably cheaper and shorter than expanding the Seaway). Do we build on as a nation (I thought PET's PetroCan was a bad idea) or expect the private market to build one which, up until now, none seem too interested. Maybe the people that fund and build these things don't see the long term return.

Betcha if you gave Irving a piece of it they could build it faster than they build our ships.

 

[Kirkhill]

It would also depend on whether Sarnia has spare capacity and, if not, is their room for expansion (I doubt it - they're pretty hemmed in). There is also Nanticoke. I don't know about their capacity or space to expand.

Building a refinery from scratch is about $10Bn and would probably take a decade (although probably cheaper and shorter than expanding the Seaway). Do we build on as a nation (I thought PET's PetroCan was a bad idea) or expect the private market to build one which, up until now, none seem too interested. Maybe the people that fund and build these things don't see the long term return.

Perhaps the problem is in the drawn out regulatory processes and the inconsistent political environment.

 

[Good2Golf]

Perhaps the problem is in the drawn out regulatory processes and the inconsistent political environment.

By inconsistent, do you mean: Approved > Cancelled? (northern gateway)

 

[Kirkhill]

By inconsistent, do you mean: Approved > Cancelled? (northern gateway)

That in particular, yes. But more generally everything seems to be set against the needs of a party getting elected. If party A sez Black then party B sez White.

And we have a constant flux. 14 jurisdictions, constantly shifting due to elections. Add in the First Nations (and to be abundantly clear I accept that they have title and it is their property except where they have relinquished property rights by treaty).

We need a legitimate "National Policy" that is accepted by all parties as legitimate.

Investors aren't going to invest if mid way through a project the rules of the game are going to change and the costs become more prohibitive, or worse the entire project gets cancelled.

....

Is our biggest problem, in the west, the rise of the backroom types focused on delivering the next election?

Keith Davey. Gerald Butts. Katie Telford. The Podestas. Morgan McSweeney. David Axelrod. Lyndon Crosby. etc.

....

Same problem with National Defence.

 

[Rifleman62]

Doesn’t mean Canada can’t pull its head out of its ass and also work with Japan (and other Asian countries), but that will clearly need Trudeau gone and Carney needs to signal that he won’t be an O&G hater after he’s appointed PM…

You Jest.
Carney can "signal" anything to get the Liberals elected, but from years of experience we all know it is just lies to hold power.

I don't believe Cdn voters will ever pull their head out of there ass especially believing the government is giving them social programs free, incl health care. Too stupid to realize the funding is from them, the taxpayer.

 

[Good2Golf]

Yeah, it’s a bit of an outside chance, isn’t it? Sadly…

 

[foresterab]

It would also depend on whether Sarnia has spare capacity and, if not, is their room for expansion (I doubt it - they're pretty hemmed in). There is also Nanticoke. I don't know about their capacity or space to expand.

Building a refinery from scratch is about $10Bn and would probably take a decade (although probably cheaper and shorter than expanding the Seaway). Do we build on as a nation (I thought PET's PetroCan was a bad idea) or expect the private market to build one which, up until now, none seem too interested. Maybe the people that fund and build these things don't see the long term return.

Or....and here's a totally off the wall thought...

1)Take an off the shelf refinery design...or buy one if private industry doesn't want it any more. Here's the current ones. https://natural-resources.canada.ca/sites/nrcan/files/energy/images/Refinery-Map-Large-E.gif
2)Fund it through public/private partnership funding....with the project designated of National importance.

• 1/4 owned by government of Canada (see point 3)
• 1/4rd owned by province on Ontario (or whatever province it's built in). This is the carrot for their voters.
• 1/4rd buy in by First Nations in area + transportation corridor. May be a combination of buy in ownership over time via split proceeds. This is to acknowledge potential impacts.
• 1/4 private equity investment which reduces their risk but also avoids full taxpayer costs.

3) Take said refinery and offer a 20 year contract operations lease on it. While there are Canadian companies that operate integrated production/refinery options there are also US operations that focus on just refineries. Don't care....public posting and bid release. Heck if it's a US company it's a "win" for them as it's Canadian revenue going to US.

4) Take 25% of the proceeds and and put it in a separate wealth fund that is a) designed to cover environmental liabilities and b) allow for future economic infrastructure investments.

I get that refineries are stinky, best built down wind of major centers, and low per unit produced profit items (aka big refineries are overall better economically than small ones). But now you have a) helped break the US dependency on refineries. b) provided an option to offshore oil purchases c) added national level infrastructure and d) have a bargaining chip to use internationally.

I have to think it's tough for Canada to be taken serious at discussions like G7 about climate change, human rights, or commitment to international trade embargos when we still import so much oil off the open market - some of which is coming from less than pristine reputation sources. Likewise if you want to talk to say - Germany - about buying new military items you now have a lever to sweeten the deal...X dollars + Y barrels of refined oil for your country at fixed price.

While connections to Eastern Canada are key I also think of even holding terminals at Churchill (for seasonal deliveries) and/or expanded BC options (Prince George and then refined products to Kitamat?).

 

[SeaKingTacco]

I think I would expand Prince George and bring Bowden back on line as fairly easy wins.

 

[lenaitch]

Perhaps the problem is in the drawn out regulatory processes and the inconsistent political environment.

If that's the case, it seems we are not alone>

https://www.barrons.com/articles/oil-stocks-energy-refinery-build-94d641d5

 

[OldSolduer]

Is our biggest problem, in the west, the rise of the backroom types focused on delivering the next election?

Keith Davey. Gerald Butts. Katie Telford. The Podestas. Morgan McSweeney. David Axelrod. Lyndon Crosby. etc.

....

Same problem with National Defence.

You have to wonder who is pulling JTs strings - because from his media interviews his answers to questions make me wonder if he's even capable of an original thought.

 

[Fishbone Jones]

You have to wonder who is pulling JTs strings - because from his media interviews his answers to questions make me wonder if he's even capable of an original thought.

Who?

 

[lenaitch]

Or....and here's a totally off the wall thought...

1)Take an off the shelf refinery design...or buy one if private industry doesn't want it any more. Here's the current ones. https://natural-resources.canada.ca/sites/nrcan/files/energy/images/Refinery-Map-Large-E.gif
2)Fund it through public/private partnership funding....with the project designated of National importance.

• 1/4 owned by government of Canada (see point 3)
• 1/4rd owned by province on Ontario (or whatever province it's built in). This is the carrot for their voters.
• 1/4rd buy in by First Nations in area + transportation corridor. May be a combination of buy in ownership over time via split proceeds. This is to acknowledge potential impacts.
• 1/4 private equity investment which reduces their risk but also avoids full taxpayer costs.

3) Take said refinery and offer a 20 year contract operations lease on it. While there are Canadian companies that operate integrated production/refinery options there are also US operations that focus on just refineries. Don't care....public posting and bid release. Heck if it's a US company it's a "win" for them as it's Canadian revenue going to US.

4) Take 25% of the proceeds and and put it in a separate wealth fund that is a) designed to cover environmental liabilities and b) allow for future economic infrastructure investments.

I get that refineries are stinky, best built down wind of major centers, and low per unit produced profit items (aka big refineries are overall better economically than small ones). But now you have a) helped break the US dependency on refineries. b) provided an option to offshore oil purchases c) added national level infrastructure and d) have a bargaining chip to use internationally.

I have to think it's tough for Canada to be taken serious at discussions like G7 about climate change, human rights, or commitment to international trade embargos when we still import so much oil off the open market - some of which is coming from less than pristine reputation sources. Likewise if you want to talk to say - Germany - about buying new military items you now have a lever to sweeten the deal...X dollars + Y barrels of refined oil for your country at fixed price.

While connections to Eastern Canada are key I also think of even holding terminals at Churchill (for seasonal deliveries) and/or expanded BC options (Prince George and then refined products to Kitamat?).

Perhaps. One thing I lose track of is who should build and run infrastructure. When public money is spent on resource infrastructure, people, particularly those in areas that don't directly benefit, go nuts (Petro-Canada). If it is such a good financial idea, why isn't private industry stepping up. Maybe some kind of PPP is the way to go.

There's a lot of 'we should do X'. Who is 'we'? People (not you) can't rail against things like bureaucracy, size of government/civil service, debt, etc. and also want it to get knee deep in industry.

I'm not smart enough to know whether distinct government-controlled piggy bank, and the money that would have to be drawn from profits, is a good idea or not.