Bloomberg is reporting:
Suncor Energy Inc. and Valero Energy
Corp. are poised to use only North American crude in eastern
Canada by 2015, helping to displace overseas imports.
Suncor’s Montreal refinery will reach that point in 2015
and Valero’s Quebec City plant by the end of this year, the
companies said April 29. Imports to Quebec, Ontario and Atlantic
provinces from outside North America dropped by more than 50
percent in November from a year earlier.
Enbridge Inc. plans to
start a pipeline late this year allowing oil to flow to Montreal
from fields in North Dakota and Alberta, further reducing
higher-priced supplies from Europe and Africa.
U.S. crude production reached a 26-year high in April,
increasing stockpiles in the U.S. to the highest since 1931,
while Canadian output is forecast to rise 4.1 percent this year.
A shift of oil to eastern Canada, coupled with future potential
to export crude, could help alleviate the glut and bring
domestic prices to an “equilibrium” with international levels,
said Tom Finlon, director of Energy Analytics Group Ltd.
"Within a very short period of time, there won’t be any
barrels coming into eastern Canada from overseas,” John Auers,
senior vice president of Tuner, Mason & Co., an industry
consultant in Dallas, said by phone April 30. “Those shipments
will be completely displaced by North American crude.”
Since the beginning of 2011, U.S. benchmark West Texas
Intermediate crude has averaged $14.02 a barrel less than Brent
oil, the international marker, after being at parity over the
previous four years. The WTI-Brent spread was $8.34 yesterday,
based on settlement prices.
Couple this with the news coming out of Saudi today (reported earlier) and things start to get interesting.
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[Update: a reader reminded me that OXY USA already announced it is moving from Los Angeles to Houston. I probably posted that once upon a time and forgot. I'm not going to take the time to change the post below -- for now. Just note that
OXY USA is moving to Houston.]
Maybe this is why OXY USA hasn't left North Dakota yet. The tea leaves some months ago suggested OXY USA was going to leave the Bakken, but OXY USA is as active as ever in the Bakken. Either they have long term plans in the Bakken, or they are continuing to "stage" their Bakken assets for a future sale.
With this story, one thinks there may be a reason for OXY USA to stay in the Bakken.
Bloomberg is reporting:
Occidental Petroleum Corp. Chief
Executive Officer Steve Chazen said the company’s California
spinoff will have plenty of places to drill that won’t be
hindered by a growing anti-fracking movement in the state.
The new company, which will be spun off to shareholders as
California Resources Corp. by year end, won’t drill in
communities that oppose oil and gas activity or hydraulic
fracturing, known as fracking, Chazen said in a call with
investors today. Occidental can avoid communities such as
Beverly Hills, which have passed limits on fracking, he said.
“To the extent that towns don’t want us there, we won’t be
there,” Chazen said, noting that some communities that oppose
drilling have high unemployment rates. “Maybe the people in
Beverly Hills should park their Rolls Royces and ride bicycles
going forward. You can see why I’m not going to be part of the
California company.”
Management of the new company will be named in the third
quarter. Chazen has said he’ll remain as CEO of Occidental.
OXY USA's corporate headquarters are located on Wilshire Avenue, Los Angeles, California. My hunch is that once the spin-off is complete, OXY USA will move its headquarters to its offices in Dallas. By the way, if that happens, I opined on that a long, long time ago, that it was just a matter of time before OXY USA leaves California. Remember: the three big plays in the US right now -- the Permian, the Eagle Ford, and the Bakken.
