WatchOil pipeline squeeze to cost Canadian economy 107 billion in 2018 Scotiabank

CALGARY — Delayed oil pipeline construction is causing a steep discount for Canadian crude prices that is costing the economy roughly $15.6 billion a year or about 0.75 per cent of GDP, according to Scotiabank.“Pipeline approval delays have imposed clear, demonstrable and substantial economic costs on the Canadian economy,” said bank chief economist Jean-Francois Perrault in a report Tuesday.The discount, however, is expected to ease through the year as more rail capacity becomes available to ship oil, bringing the expected cost to roughly $10.7 billion or 0.5 per cent of GDP for 2018 and then $7 billion or 0.3 per cent of GDP a year until more pipeline capacity comes online.Main oil pipelines to U.S. will be full for next 3 years — even one not yet builtPembina Pipeline’s new purpose: Get Canada’s oil and gas to the rest of the worldNothing to attract investment here — experts weigh in on Canada’s new resource project rulesThe costs come as delays continue for all three major proposed oil pipelines to export more oil from Western Canada, including Kinder Morgan’s Trans Mountain expansion, Enbridge’s Line 3 replacement, and TransCanada’s Keystone XL.Canadian producers would need Line 3 and at least one of the other pipelines to go forward or face indefinite pipeline constraints that would have an impact on Canada’s well-being with consequences that extend well beyond Alberta, said Perrault.“The elevated discounts come with a steep economic cost, and represent to a large degree a self-inflicted wound,” he said.The latest economic impacts of the pipeline constraints come as Alberta and British Columbia continue to quarrel over the construction of the Trans Mountain project, pitting arguments of economic impact against the importance of protecting coastlines and limiting greenhouse gas emissions.The current squeeze in pipeline capacity has been expected for some time, but the leak and temporary shutdown on TransCanada’s Keystone pipeline last November sped up the problem, said Perrault.The shutdown led to oil storage tanks in Alberta to fill to record volumes and sent the spread between Western Canadian and U.S. crude to more than US$30 a barrel, while the regulator-imposed 20 per cent reduced capacity on Keystone has continued to limit a recovery.The discount on Western Canadian oil production since the spill has hovered around US$24 a barrel, much higher than the US$13 spread for the past two years, and Scotiabank expects it to average US$21.6 a barrel for 2018.Western Canadian production is discounted somewhat both by quality and transportation costs, but has spiked several times in the past decade as pipeline space runs tight. read more



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Kraft Foods Group CEO Vernon plans to retire Chairman Cahill named as

AddThis Sharing ButtonsShare to TwitterTwitterShare to FacebookFacebookShare to RedditRedditShare to 電子郵件Email NORTHFIELD, Ill. – Kraft Foods Group Inc. says that CEO Tony Vernon plans to retire later this month. The company named Chairman John Cahill as his successor.Vernon has served as CEO since the consumer packaged food and beverage company’s spinoff from Mondelez International Inc. in October 2012. Before that, he was the company’s executive vice-president and president of Kraft Foods North America.Kraft’s brands include Jell-O, Maxwell House, Oscar Mayer and its namesake, among others.While Vernon plans to retire from the CEO post on Dec. 27, he will remain with the Northfield, Illinois-based company through March 31, 2015 as a senior adviser. He will also continue as a board member until the next annual meeting. Vernon will be 59 when he retires as a director.“With the company on solid footing after the spin-off, the time is right for new leadership to fulfil our potential as the industry leader. The board and Tony agree that we need to accelerate the pace of change,” Mackey J. McDonald, lead independent director, said in a statement on Thursday.Vernon said that he feels “now is the right time to step back and devote time to the one thing I love more than our brands_my family.”Cahill, 57, previously served as chairman and CEO of The Pepsi Bottling Group Inc. He joined Kraft in January 2012 as Executive Chairman Designate of the North American grocery business. He became executive chairman at the company’s spinoff and transitioned to a non-executive chairman role in March.Shares of Kraft Foods rose $1.68, or 2.8 per cent, to $61.24 in morning trading after hitting a high for the year of $61.47 earlier. Kraft Foods Group CEO Vernon plans to retire; Chairman Cahill named as successor by The Associated Press Posted Dec 18, 2014 7:12 am MDT read more



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