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CNRL curtailing production from new natural gas wells as low prices persist

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CALGARY – Canada’s largest oil and gas producer is postponing the start of production from some of its planned new natural gas wells due to persistent low prices.

Canadian Natural Resources Ltd. said Thursday about 20 of its remaining planned 2024 natural gas wells will be drilled this year, but the company will curtail production from them until prices improve.

“I can’t give you an exact price, but it has to be better than what it is now,” said CNRL president Scott Stauth on a conference call with analysts, adding he expects prices could rebound enough to bring the wells online by late 2024 or early 2025.

Low natural gas prices, the result of too much supply in the market, are hurting producers all over North America. Companies are shutting in production or delaying and cancelling projects.

This week, U.S. natural gas futures hit a new 12-week low, in spite of hot summer conditions, which usually bode well for natural gas because warm weather boosts the need for electricity-driven air conditioning.

Part of the reason for the current glut in supply is that North American oil output is increasing. Major oil producers are pumping out more oil in the face of strong demand and healthy prices, and producing natural gas as a byproduct of that process.

On Thursday, Stauth said CNRL has shifted some of its natural gas development focus this year to higher-return multilateral heavy oil wells.

The startup of the Trans Mountain pipeline expansion in May has boosted prices for Canadian heavy oil producers, which prior to the pipeline’s opening took a significant discount on their product compared to U.S. competitors simply due to a lack of export capacity.

CNRL holds the largest heavy oil land base in Canada.

“The impact on the energy industry has been and will continue to be positive,” Stauth said of Trans Mountain’s completion.

CNRL’s earnings were up in the second quarter in part because of higher oil sales and prices.

The company said its earnings were $1.72 billion for the quarter ending June 30, up from $1.46 billion for the same quarter last year.

Earnings worked out to 80 cents per diluted share, up from 66 cents last year.

Adjusted net earnings from operations were $1.89 billion, up from $1.26 billion last year.

The company said production volumes in the quarter were 1.29 million barrels of oil equivalent per day, up eight per cent from the same quarter last year.

That came in slightly ahead of analysts’ expectations of $1.27 million barrels of oil equivalent per day.

In July, CNRL said it produced the one billionth barrel of bitumen from its Horizon oilsands facility since operations began there in 2009.

The company has said it believes the output at Horizon could be increased by 195,000 barrels per day of synthetic crude oil, a 76-per-cent hike from the mine’s current capacity of approximately 255,000 barrels per day.

But Stauth said Thursday that plan is dependent on a number of conditions, including government support for the oilsands industry’s proposed Pathways Alliance carbon capture and storage project.

He said the Pathways group remains in talks with both provincial and federal governments in an effort to find a funding model that would allow the proposed $16.5-billion carbon transportation network to go ahead.

This report by The Canadian Press was first published Aug. 1, 2024.

Companies in this story: (TSX:CNQ)

The Canadian Press. All rights reserved.

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Suspicious deaths of two N.S. men were the result of homicide, suicide: RCMP

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Nova Scotia RCMP say their investigation into two suspicious deaths earlier this month has concluded that one man died by homicide and the other by suicide.

The bodies of two men, aged 40 and 73, were found in a home in Windsor, N.S., on Sept. 3.

Police say the province’s medical examiner determined the 40-year-old man was killed and the 73-year-old man killed himself.

They say the two men were members of the same family.

No arrests or charges are anticipated, and the names of the deceased will not be released.

RCMP say they will not be releasing any further details out of respect for the family.

This report by The Canadian Press was first published Sept. 16, 2024.

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Turning the tide: Quebec premier visits Cree Nation displaced by hydro project in 70s

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For the first time in their history, members of the Cree community of Nemaska received a visit from a sitting Quebec premier on Sunday and were able to share first-hand the story of how they were displaced by a hydroelectric project in the 1970s.

François Legault was greeted in Nemaska by men and women who arrived by canoe to re-enact the founding of their new village in the Eeyou Istchee James Bay region, in northern Quebec, 47 years ago. The community was forced in the early 1970s to move from its original location because members were told it would be flooded as part of the Nottaway-Broadback-Rupert hydro project.

The reservoir was ultimately constructed elsewhere, but by then the members of the village had already left for other places, abandoning their homes and many of their belongings in the process.

George Wapachee, co-author of the book “Going Home,” said community members were “relocated for nothing.”

“We didn’t know what the rights were, or who to turn to,” he said in an interview. “That turned us into refugees and we were forced to abandon the life we knew.”

Nemaska’s story illustrates the challenges Legault’s government faces as it looks to build new dams to meet the province’s power needs, which are anticipated to double by 2050. Legault has promised that any new projects will be developed in partnership with Indigenous people and have “social acceptability,” but experts say that’s easier said than done.

François Bouffard, an associate professor of electrical engineering at McGill University, said the earlier era of hydro projects were developed without any consideration for the Indigenous inhabitants living nearby.

“We live in a much different world now,” he said. “Any kind of hydro development, no matter where in Quebec, will require true consent and partnership from Indigenous communities.” Those groups likely want to be treated as stakeholders, he added.

Securing wider social acceptability for projects that significantly change the landscape — as hydro dams often do — is also “a big ask,” he said. The government, Bouchard added, will likely focus on boosting capacity in its existing dams, or building installations that run off river flow and don’t require flooding large swaths of land to create reservoirs.

Louis Beaumier, executive director of the Trottier Energy Institute at Polytechnique Montreal, said Legault’s visit to Nemaska represents a desire for reconciliation with Indigenous people who were traumatized by the way earlier projects were carried about.

Any new projects will need the consent of local First Nations, Beaumier said, adding that its easier to get their blessing for wind power projects compared to dams, because they’re less destructive to the environment and easier around which to structure a partnership agreement.

Beaumier added that he believes it will be nearly impossible to get the public — Indigenous or not — to agree to “the destruction of a river” for a new dam, noting that in recent decades people have come to recognize rivers as the “unique, irreplaceable riches” that they are.

Legault’s visit to northern Quebec came on Sept. 15, when the community gathers every year to remember the founding of the “New Nemaska,” on the shores of Lake Champion in the heart of the boreal forest, some 1,500 kilometres from Montreal. Nemaska Chief Clarence Jolly said the community invited Legault to a traditional feast on Sunday, and planned to present him with Wapachee’s book and tell him their stories.

The book, published in 2022 along with Susan Marshall, is filled with stories of Nemaska community members. Leaving behind sewing machines and hunting dogs, they were initially sent to two different villages, Wapachee said.

In their new homes, several of them were forced to live in “deplorable conditions,” and some were physically and verbally abused, he said. The new village of Nemaska was only built a few years later, in 1977.

“At this time, families were losing their children to prison-schools,” he said, in reference to the residential school system. “Imagine the burden of losing your community as well.”

Thomas Jolly, a former chief, said he was 15 years old when he was forced to leave his village with all his belongings in a single bag.

Meeting Legault was important “because have to recognize what happened and we have to talk about the repercussions that the relocation had on people,” he said, adding that those effects are still felt today.

Earlier Sunday, Legault was in the Cree community of Eastmain, where he participated in the official renaming of a hydro complex in honour of former premier Bernard Landry. At the event, Legault said he would follow the example of his late predecessor, who oversaw the signing of the historic “Paix des Braves” agreement between the Quebec government and the Cree in 2002.

He said there is “significant potential” in Eeyou Istchee James Bay, both in increasing the capacity of its large dams and in developing wind power projects.

“Obviously, we will do that with the Cree,” he said.

This report by The Canadian Press was first published Sept. 16, 2024.



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Quebec premier visits Cree community displaced by hydro project in 1970s

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NEMASKA – For the first time in their history, members of the Cree community of Nemaska received a visit from a sitting Quebec premier on Sunday and were able to share first-hand the story of how they were displaced by a hydroelectric project in the 1970s.

François Legault was greeted in Nemaska by men and women who arrived by canoe to re-enact the founding of their new village in the Eeyou Istchee James Bay region, in northern Quebec, 47 years ago. The community was forced in the early 1970s to move from their original location because they were told it would be flooded as part of the Nottaway-Broadback-Rupert hydro project.

The reservoir was ultimately constructed elsewhere, but by then the members of the village had already left for other places, abandoning their homes and many of their belongings in the process.

George Wapachee, co-author of the book “Going Home,” said community members were “relocated for nothing.”

“We didn’t know what the rights were, or who to turn to,” he said in an interview. “That turned us into refugees and we were forced to abandon the life we knew.”

The book, published in 2022 by Wapachee and Susan Marshall, is filled with stories of Cree community members. Leaving behind sewing machines and hunting dogs, they were initially sent to two different villages, 100 and 300 kilometres away, Wapachee said.

In their new homes, several of them were forced to live in “deplorable conditions,” and some were physically and verbally abused, he said. The new village of Nemaska was only built a few years later, in 1977.

“At this time, families were losing their children to prison-schools,” he said, in reference to the residential school system. “Imagine the burden of losing your community as well.”

Legault’s visit came on Sept. 15, when the community gathers every year to remember the founding of the “New Nemaska,” on the shores of Lake Champion in the heart of the boreal forest, some 1,500 kilometres from Montreal. Nemaska Chief Clarence Jolly said the community invited Legault to a traditional feast on Sunday, and planned to present him with Wapachee’s book and tell him their stories.

Thomas Jolly, a former chief, said he was 15 years old when he was forced to leave his village with all his belongings in a single bag.

Meeting Legault was important “because have to recognize what happened and we have to talk about the repercussions that the relocation had on people,” he said, adding that those effects are still felt today.

Earlier Sunday, Legault had been in the Cree community of Eastmain, where he participated in the official renaming of a hydro dam in honour of former premier Bernard Landry.

This report by The Canadian Press was first published Sept. 16, 2024.

The Canadian Press. All rights reserved.



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