Canada's Fiscal Situation

Why focus on balanced budget when the pundits say we shouldn’t?  This is the question being asked of Harper’s government.

“There’s nothing magic about zero deficit,” former Bank of Canada governor David Dodge told CBC Radio’s The House. “We have a very good debt-to-GDP situation… that can actually be held at the current ratio, which is quite good by international standards, while running a deficit.”

With the looming federal election the Conservatives nebulous position provides latitude to change their stance based on polling results.  High on the list is trust and brand, one of the core values espoused by Conservatives across the country is fiscal responsibility.  Much of the last campaign was based on balanced budgets and belief this is the reason why Canadians voted Conservative.

Joe Oliver, Canada’s Minister of Finance, insists he will deliver a balanced budget while postponing it’s release until April to further analyze the impact of falling oil prices.  He has not ruled out dipping into the contingency fund to make this happen.

Earlier this week, the IMF said it expected economic growth of 2.3 per cent in Canada in 2015, down from 2.4 per cent in its forecasts issued three months ago. The agency is lowering its overall outlook for global growth

Low oil prices and ailing manufacturing sector will challenge Harper’s political instinct on which direction is best to take.  The rest remains to be seen!

 


Drop in oil prices a Good thing!

oil tanker

November 12 2014, London

International Energy Agency’s (IEA) World Energy Outlook 2014 excerpts

“A well-supplied oil market in the short-term should not disguise the challenges that lie ahead, as the world is set to rely more heavily on a relatively small number of producing countries,” said IEA Chief Economist Fatih Birol. “The apparent breathing space provided by rising output in the Americas over the next decade provides little reassurance, given the long lead times of new upstream projects.”

Demand for gas is more than 50% higher in 2040, and it is the only fossil fuel still growing significantly at that time. The United States remains the largest global gas producer, although production levels off in the late-2030s as shale gas output starts to recede. East Africa emerges alongside Qatar, Australia, North America and others as an important source of liquefied natural gas (LNG), which is an increasingly important tool for gas security. A key uncertainty for gas outside of North America is whether it can be made available at prices that are low enough to be attractive for consumers and yet high enough to incentivise large investments in supply.

Click here to download Executive Summary

A recent article in the Wall Street Journal  suggests many of the world’s top pol­icy mak­ers are rewrit­ing their eco­nomic fore­casts for the United States, Europe and else­where in the world, bet­ting that plum­met­ing oil prices will boost growth by hand­ing con­sumers and man­u­fac­tur­ers a wind­fall.  Historically sharp drops  large drops in oil prices tend to be associated with recession.  According to Guy Caruso, a former head of the US Energy Administration, “this time it’s different.”

Click to view interview with Ian Talley of Wall Street Journal Oil Supply and the Global Economy WSJ


Northeast BC Update - October 2014

Drilling companies gear up for large contracts related to LNG, Financial Post, November 1, 2014
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Canada’s Western Provinces Eye Tax Perk in Push for LNG –British Columbia and Alberta are banding together to push the Canadian government to apply the same tax treatment to multibillion-dollar energy plants that benefits Ontario manufacturers. Bloomberg, Oct 30, 2014

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According to Heffernan, drilling activity was up by 26 per cent in B.C. in 2014 compared to last year. If five LNG facilities were to come online, he said, one forecast predicted that by 2019, about four times as many wells would be drilled than there were in 2013. October 23, 2014 Alaska Highway News
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Petronas Still Evaluating Tax Impact on LNG Project – Vancouver Sun, Oct 22, 2014
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Why the LNG Industry could be Poise for Liftoff with BC’s Tax Regime, Financial Post October 22, 2014
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Petronas Led pacific Northwest LNG Consortium Reviewing BC Tax Announcement, The Canadian Press October 22, 2014
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Fortis commences expansion of British Columbia LNG Facility – Stockhouse, October 19, 2014
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BC Hydro Says Site C Dam  Construction Could Start in January 2015, The Province, October 21, 2014
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BC Introduces Pollution Benchmark for LNG Plants with Option to buy Offsets, Vancouver Sun, October 21, 2014
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By the Numbers: The Site C Dam Project, The Province blog, October 19, 2014
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Edmonton Population Explosive

7.4% increase in Edmonton’s population since 2012 with the largest group between 20 – 39 which is a major economic driver. READ MORE

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The race for LNG profits!

New York-based Oregon LNG applies to export Canadian natural gas

A New York-based holding company applied to regulators to use Canadian natural gas to feed a proposed export terminal in Oregon, putting a cross-border twist on Canada’s plans to lng_10 Jan 16create a brand new liquefied natural gas industry.

Fluor and JGC Awarded EPC Contract for Kitimat LNG Project

Fluor Corporation (NYSE: FLR) announced today that its joint venture with JGC was awarded an engineering, procurement and construction (EPC) contract by Chevron Canada Limited

Petroleum Brunei joins Petronas’s B.C. natural-gas project

(Chevron) for the proposed Kitimat Liquefied Natural Gas (LNG) project in Bish Cove, British Columbia, Canada.  Petroleum Brunei has signed on as a new partner in Malaysian energy giant Petronas’s fledgling B.C. LNG project.

For more details on LNG development and production in BC, visit Government of British Columbia LNG in BC


Here's Where Canada's Biggest Job Growth will be in 2014

Looking for Work?

oil-sands1-Jan 15

According to Workopolis there were more than half a million job openings in Canada in November, a 22% jump over the same period last year.   Over 40% of all the job openings in the country were in the western provinces.  Although December job losses were significant, overall 2013 gained over 100,000 jobs.

A very busy year: oil patch hiring activity expected to rise in 2014 – Alberta saw employment surge by 78,000 till November 2013, which kept jobless rates at 4.7% — second lowest in the country after Saskatchewan.

UnEmployment Rate Jan 2014

Near term job prospects up for Calgary and Edmonton – Conference Board of Canada Help Wanted Index led the way in October with a gain of 7.5 points, which was the third consecutive increase for the province.

The western provinces boast the lowest unemployment rates in the country and this trend is poised to continue as Canada emerges as an energy super power.  Not hard to see why of Canada’s top 10 jobs three are in the energy sector.

Be prepared to re-locate to areas that have low unemployment and strong economic growth.


BC Gas is attracting more and more international players

Petroleum Brunei to take stake in Petronas’s B.C. natural-gas project

By BRENT JANG, Globe & Mail

After the latest transaction, Petronas’s stake in Pacific Northwest LNG will be reduced to 87 per cent from 90 per cent

A liquefied natural gas project in British Columbia proposed by Malaysia’s state-owned Petronas has attracted a new partner. Petroleum Brunei has agreed to acquire a 3-per-cent stake in the Pacific NorthWest LNG project led by Petronas. Earlier this year, Tokyo-based Japan Petroleum Exploration picked up a 10-per-cent interest in Pacific NorthWest LNG. After the latest transaction, Petronas’s stake in Pacific Northwest LNG will be reduced to 87 per cent from 90 per cent. The energy giant has been on the hunt for new partners to help with the massive LNG development planned for a site near Prince Rupert in northwestern British Columbia.       As part of the deal announced late Sunday, Petroleum Brunei has agreed to buy a 3-per-cent share of Pacific NorthWest LNG’s output for at least 20 years. Petroleum Brunei is also poised to scoop up a 3-per-cent stake in Progress Energy Canada Ltd.’s northeast B.C. natural gas assets, Progress said. Petronas bought Calgary-based Progress last year for $5.2-billion. “This brings another strong partner and investor to our Canadian LNG business and is further evidence of Asia’s burgeoning interest in securing British Columbia natural gas,” Progress president Michael Culbert said in a statement. Mr. Culbert said Progress is looking forward to adding more partners next year. Pacific NorthWest LNG president Greg Kist asserted that the joint venture is well positioned to lure additional international investors. There are at least 10 LNG projects proposed for northwestern British Columbia, but they are in a race within Canada and also face stiff global competition to deliver LNG to Asia.

Petronas bets tens of billions on BC

Petronas bets tens of bil­lions on B.C.
BRENT JANG With files from Glo­ria Gal­loway in Ot­tawa and The Cana­dian Press
The Globe and Mail (BC Edition)
7 October, 2013

Malaysian Prime Minister Najib Razak is touting tens of billions of dollars earmarked for British Columbia by Malaysia’s state-owned energy company Petronas as a sign of Canada’s favourable business climate.

Mr. Najib said at a news conference in Malaysi…read more…


A Busy Summer In BC's northeast...

 

Major investments in BC’s northeast and northwestern Alberta make these areas prime real estate investment markets.
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A Busy Summer…

This summer’s articles are mostly related to BC’s burgeoning LNG (liquefied natural gas)  industry. And while we follow many investment markets, not a week passes without announcement of yet another major investment in the development of this resource… what is more important is the impact that it is having on real estate in Northeastern BC and Northwestern Alberta making these markets prime investment areas.

One of the articles below references a report stating that BC’s LNG industry could provide 75,000 permanent jobs moving forward as well as a large number of construction jobs to get things going. This number does not include the potential 33,000 direct and indirect jobs created by BC Hydro’s Site ‘C’ Dam project. With Dawson Creek and Fort St. John having a combined population of under 35,000, you can imagine the impact on the housing markers resulting from the influx of workers into these areas.

Furthermore, with housing supply limited by the agricultural land reserve (ALR) surrounding these cities (very difficult and time consuming to pull land out of the ALR) and a short building season, I believe the circumstances are prime for investing in real estate in the area.

As always, If you have any questions about the area or our cash flowing investment properties in Fort St. John or Dawson Creek, I’m here to help. Hope you enjoy the articles.  If you are interested in seeing first hand what is happening in the area join us September 21st on Western Canadian Properties Investor Tour to Fort St. John.

Contact me to receive property brochure for our NEW pre-sale investment properties.  If you would like to join us on the trip, please call NOW as there is limited space available.

Regards,

Cynthia Aasen

Strategic Investment Realty

604-764-5647

Pacific Northwest LNG CEO on BNN discussing their $10,000,000,000 project in Prince Rupert.

Development of LNG promises transformative prosperity for the province.

Richard Coleman: In British Columbia, we have a unique opportunity to capitalize on our most promising resource to generate revenues in excess of $100 billion over the next 30 years, while enabling the world to benefit from one of the cleanest-burning fossil fuels on the planet.

Continue Reading >>

Exxon joins West Coast LNG race, seeks 25-year export permit.

ExxonMobil Corp. has joined the race to export liquefied natural gas from British Columbia with a monster proposal that would process the equivalent of nearly one-third of Canada’s current daily production…

Continue Reading >>

B.C.’s LNG export industry could provide 75,000 permanent jobs

In its latest bid to demonstrate the potential scale of its nascent liquefied natural gas industry, the province has unveiled a scenario that shows the sector could support a permanent workforce of 75,000…

Continue Reading >>

Cynthia AasenStrategic Investment RealtyC 604.764.5647E cynthia@strategicinvesmentrealty.com

 

 

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Is BC's north Canada's next Fort McMurray?

The heading reads ” LNG: The race for the next ‘Fort McMurray’  published in the Financial Post May 5, 2013.  The essence is that most don’t know how much money is being invested, by whom and how this segment is dominating the attention of the energy sector.

Christy Clark’s Todays Liberals swept the BC election winning an unprecedented majority government completely unexpected.  Her top priority developing the LNG sector of the British Columbia economy to bring economic stability to the province and the rest of Canada.

To read more http://business.financialpost.com/2013/05/22/lng-the-race-for-the-next-fort-mcmurray/.