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Canadian oilsands player calls for government to mandate production cuts

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One of the country’s largest oilsands players, Cenovus Energy, is urging the Alberta government to implement “temporary” production cuts across the oil sector as Canadian crude prices continue to struggle.

A shortage of pipeline capacity is contributing to a huge gap between the price for Canadian crude and the American benchmark, costing some companies and the provincial government dearly.

Cenovus says the magnitude of the price gap is causing significant losses for many producers — and that the provincial government has the power to enforce output cuts and “alleviate the wide differentials.”

Earlier this month, the Calgary-based company said it would limit its oil output by an unspecified amount. 

“We think there is a strong case for the government to temporarily mandate reduced production for the industry,” Cenovus said in an email statement to CBC News.

“Our inability as a country to build critical new pipeline projects means we are now in a situation where we can’t get our growing oil production to market. This has resulted in a market failure.

“This market failure is the result of policy failures at the federal level that impacted pipeline projects, and in the short term it can only be fixed by the Government of Alberta through temporary mandatory industry-wide production cuts.” 

Cenovus said the market can’t fix a problem that is “inherently political.”

The company pointed to legislation used by the Alberta government nearly 40 years ago that curtailed oil production.

Alberta Premier Rachel Notley called on the federal government last month to increase the capacity to transport oil by rail. (CBC)

In 1980, Premier Peter Lougheed enforced output cuts during a dispute with Ottawa over the National Energy Program.

“Legislation exists, and has been used previously by the Lougheed government, to require all producers to temporarily cut production to alleviate the wide differentials,” said the Cenovus statement. 

“Government has a duty to protect the value of its oil resources on behalf of Albertans.”

Peters & Co., an energy-focused investment bank, recently estimated that if the price gap remains at around $40 a barrel for 2019, it would cost the Alberta government about $5 billion in oilsands royalties for the year.

According to Peters & Co.’s report, the situation could result in substantial revenue loss for the government.

Its estimate does not include the impact on conventional oil or condensate royalty revenues, which are also affected by wide differentials. Nor does it factor in the impact of a slow-down in economic activity.

“The Alberta Government has a lot at stake with the wide differentials, and should be motivated to improve the situation in the near-term,” said the report from Nov. 9.

Last month, Premier Rachel Notley called on the federal government to buy more rail cars to transport Alberta oil.

“The oil price differential right now is absurd, and exactly why Premier Rachel Notley is fighting to build new pipelines and pushing Ottawa to step up and help fix the backlog in rail shipments,” said Mike McKinnon, spokesman for the province’s minister of energy, said in an email statement.  

“We continue to engage industry leaders on a number of different approaches and look forward to having more to say soon.”

A driver inspects his vehicle before starting his shift at the Shell Albian Sands oilsands mine near Fort McMurray, Alta., in July 2008. (Jeff McIntosh/Canadian Press)

Martin Pelletier, portfolio manager at TriVest Wealth Counsel in Calgary, said “desperate times call for desperate measures,” but he would rather see industry come up with a solution than the government impose one.

Where the province could play an important role, is in getting oil executives in a room and helping mediate an industry-led agreement, Pelletier said.

“It has to start with industry,” he said.

However, he said he was not surprised to hear Cenovus’ suggestion because “we have to get the conversation going” about solutions to a “made-in-Canada” energy crisis.

Warren Mabee, director of Queen’s Institute for Energy and Environmental Policy, said it would be hard to get companies to agree to cuts, given competing interests and agendas. 

Large integrated companies, like Suncor, would not be affected like companies without refineries or other options for their oil productions, he said.

“I think it’d be very difficult to come up with an agreement,” Mabee said. “It’s a tough thing unless everybody really does come on board with it.”

Mabee also thinks governments — federal or provincial — would be reluctant to get involved in mandating cuts.

“To put a mandate into place means that you’re actually playing with the market, and if you’re playing with the market as a government then you’re opening you’re opening yourself up on the trade front,” Mabee said.

“Given that our trade with the U.S. is a little fraught right now… I just can’t see government wanting to do it​.”

Enbridge workers weld pipe for the Line 3 pipeline project just west of Morden, Man., in August 2018. (John Woods/Canadian Press)

Cenovus is not the only company to announce that it would limit its own oil output.

Earlier this month, Canadian Natural Resources said it has already cut production by up to 15,000 barrels per day and could increase that figure to as much as 55,000 this month and in December.

Canadian prices crashed in September because of a backlog of oil in Alberta.

The Fort McMurray region has increased production throughout this year, but export pipelines are full and several refineries in the U.S. which process heavy oil from Alberta, shut down for maintenance.

Some industry experts now expect low prices for Canadian heavy crude could persist into 2020.

More export pipeline space is expected once Enbridge’s Line 3 replacement project is complete in about 12 months.

With files from Kyle Bakx

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The cost of renovating your bathroom in Toronto in 2021

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Home renovations can be a big task, especially bathroom renovations where you have to work with either an awkwardly shaped space, or one with lots of pipework and very little natural light.

Nonetheless, getting a bathroom renovation by Easy Renovation to change your existing bathroom layout, improve the ambience or add more natural skylights can be worth all the trouble. But determining how much a bathroom renovation would cost is important while setting a budget.

The pandemic has changed a lot of things with social distancing rules, working from home, and for some, being made redundant. Therefore, having a complete grasp of the financial implication of a bathroom innovation is very important.

Owning your dream bathroom can be made a reality and the good thing is, regardless of your financial situation, there are always available options. If you also decide to put up your property for sale in the future, a bathroom upgrade would be a great investment—as it would add significant value to the property. Your bathroom renovation project, like every home renovation, can either be very affordable or extravagant, but one thing is certain, you’re bound to have a more refreshed, stylish and modernistic space.  

Looking through detailed sketches of luxurious and expensive bathrooms can be quite tempting, especially when you’re on a budget. However, your bathroom can be equally transformed into something that looks just as modern, stylish and refreshing but without the heavy price tag.

Conducting a partial bathroom renovation means you only have to change a little part of your existing bathroom rather than tearing it down and starting from scratch. If you intend to carry out this type of bathroom renovation in Toronto, depending on the size of your bathroom, you can spend between $1,000 – $5,000. With a partial bathroom renovation, you can save money by tackling smaller problems that exist in your present bathroom—or you can just upgrade a few of its features.

Partial bathroom renovations are quite affordable and would leave your bathroom feeling new and stylish without being time-consuming or a financial burden—which is important considering the economic impact of the pandemic. Repainting the bathroom walls, replacing the tiles on the floor and in the shower area are examples of partial bathroom renovations which is the cheapest to accomplish.

A more expensive and popular bathroom renovation is the standard 3- or 4-piece renovation. This renovation type involves a lot more services that are not covered by a partial renovation budget. To execute a standard bathroom renovation in Toronto you need a budget of about $10,000 – $15,000.

Unlike with a partial renovation, you would have to make a lot more changes to various elements of your bathroom without the hassle of changing the overall design. You can easily restore your current bathroom into a modernistic and classy space that fits your existing style. Making changes to more aspects of your bathroom is quite easy since there is more room in your budget to accommodate it.

A standard 3- or 4-piece renovation includes everything in a partial renovation plus extras such as revamped baseboards, installing a new bathroom mirror, buying new lights, installing a new vanity, changing the toilet, and buying new shower fixtures.

If you’re one of those looking to make a complete overhaul of your existing bathroom, then the option of a complete bathroom remodel is for you.

Unlike a bathroom renovation, remodelling means a complete change of your current bathroom design and layout for one that is newer and completely unrecognizable. The possibilities when remodelling a bathroom are endless especially when you have a large budget of over $15,000. That way, you can get the opportunity to create the perfect bathroom for yourself.

In addition to all that’s available with a standard bathroom renovation, bathroom remodelling allows you to make bathtub to shower conversion, relocation of plumbing, relocation of the toilet, reframing the bathroom and even relocating the shower.

In conclusion, a bathroom renovation can be a very important upgrade to your home and depending on the features that you decide to include, in addition to the size of your bathroom, this would influence the total cost of the project.

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7 Tips For First-Time Home Buyers In Calgary

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Buying a house for the first time can be overwhelming to say the least. If you’re wondering what neighbourhood to go with, what you can afford, or even how to just get started on the process, let us take some stress off your hands! We’ve teamed up with Hopewell Residential to give you 7 tips to ensure the home you end up with is everything you dreamed of.

Hopewell Residential is a five-time Developer of the Year award winner, so their expertise is second-to-none in Calgary and beyond. Who better to learn home-buying tips from than the homebuilders themselves?

Create a checklist of needs & wants

This is a biggie. When you’re buying your very first home, you’ll want to weigh your needs vs. your wants. Ensuring you have what you love in your first home is a big, big deal.

What should you do? Easy. Set up a list of needs and a list of wants, but be pretty strict with yourself, and make sure you take your lifestyle into consideration. With the increase in remote work over the past year, it’s important to keep in mind that a home office or flex room might just be the key to maximizing at home happiness. Especially if you’re thinking you might be expanding your family later on, spare rooms and extra space is key (but more on that later!).

Or for instance, you might need a home in an area with a high walkability score, but you want to be close to certain amenities. Set yourself up with the right level of compromise and the number of homes that actually fit your ‘perfect’ idea will skyrocket.

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‘Don’t give up’: Ottawa Valley realtors share statistics, tips for homebuyers in ‘extreme’ sellers market

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The real estate market in the Ottawa Valley can be summed up this way: people from far and wide are in a buying frenzy, but there’s hardly anything to buy at the “store,” and the limited inventory is overpriced.

This “stampede” — as one realtor described it — will affect rural towns as residents grapple with finding affordable housing and agonize over their inability to purchase homes in their price range.

“We are seeing a lack of inventory in all price ranges,” said Laura Keller, a real estate agent from Carleton Place.

Helen Vincent, a Renfrew realtor, said she’s never seen a market like this in her 36 years of practice. “We postpone offers for four to five days in order to get all the buyers,” she said.

Multiple offers — between seven and 10 — became the norm, with cash offers and no conditions, as buyers faced bidding wars. “In Ottawa, they have up to 50 (offers),” she added.

“It’s very stressful. You’re going to get nine (people) ticked off, and one happy. So many people are disappointed,” Vincent said.

Terry Stavenow, an Arnprior realtor for 40 years, said that “the pent-up need took over with inventory going low. It made a stampede on everything that was available.“

“Brand new housing — it’s very much gone. Several building developers are rushing to get inventory. They usually don’t do construction in the winter months,” said Stavenow.

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