Canadian biz media missing bitumen bubble

Paul McKay writes for the National Observer about how the Canadian business news outlets are ignoring the next large economic bubble in the country.

McKay writes, “In my view, Canada’s mainstream business news platforms (with a few stellar exceptions) have failed in their responsibility to make facts and evidence the cornerstone of their oilsands coverage. I routinely read the business sections of the Globe, Toronto Star, Edmonton Journal, Calgary Herald, Vancouver Sun, National Post and Financial Post. I scan BNN daily and the political panel shows of CBC and CTV.

“To my knowledge, no one has asked these four key questions:

• What proof is there that Asian refiners have signed contracts to purchase vast volumes of Alberta raw bitumen for decades to come? If these do not exist, there is no demand.
• What proof is there that Asian refiners are willing to contractually commit to a much higher price than U.S. refiners will pay for raw Alberta bitumen? If such contracts do not exist, there is no price certainty to support oilsands expansion.
• What proof is there that Alberta bitumen ranks high in global comparisons of oil quality, price, and ocean supertanker access, shipping costs and speed?
• Which private Big Oil players have recently placed big bets buying new, undeveloped oil sand properties, which would underpin Alberta’s expansion plans?

“Tellingly, the working assumption seems to be that such business case certainty must exist, even though there is no evidence of it. That there isn’t a bitumen bubble, because no reporters have dared to ask if Alberta’s oilsands ambitions really amount to a bright and shining lie. Just as generations of children don’t press their parents very hard about that pony they expect to get for Christmas and how it will get down the chimney. The answer might be unthinkable.”

Read more here.