Hey, sorry, I tried looking up a case study of this for myself, but couldn’t find anything substantial. Do you guys have anything like this?
I’m wondering about the new pipeline purely from an economic sense.
Essentially stuff like:
- Projected taxpayer funded dollars to build the entire thing (a projected bell curve of expenditure).
- Projected oil demand, and price for the time that the pipeline remains operational.
- Finally, a bell curve of ROI for us.
I know I know, the environmental damage this would do is horrible, blah blah blah. I agree. I just want to know if this is at the very least a good financial decision or not.
Again, I’m looking for actual quantitative projections. Not stuff like, “but Asia is moving toward renewables”.
Depends on who you are… an O&G company? Nearly infinite as the public foots the infrastructure bill and you just see revenue.
But for the rest of us who’s tax dollars are being spent on this insanity, it’ll be zero or negative. All costs with negative benefits like less money for heathcare or road infrastructure.
There probably wont be any ROI.
My guess like most things in Canada, once built it will be sold to the private sector for pennies on the dollar.
ROI is basically non-existent. The numbers are closely held trade secrets, you won’t find the projections published anywhere, but most sources agree, the prospects for demand are bad, which is why no private investors can be found. Industry insiders agree that basically the whole industry is sun-setting, so the majors are just going to ride it into the ground, claim capital losses and declare bankruptcy after the equity is safely transferred elsewhere. Optimistically we’re looking at maybe 40-60 years before we even recoup the initial principle.
What it does do, however, is make it basically impossible for Alberta to separate. It catches their nuts in an economic vise. Their debt to Canada because of those two pipes would bankrupt them 100x over if they ever tried to leave.
Bingo! Give this guy a prize, they get what’s going on.
Vaguely related thought: I’m pretty sure the AI bubble also has a lot to do with the fossil fuel industry transferring their wealth out of oil while at the same time wringing the last substantial profits they can out of their dying industry. They don’t give a shit if it all collapses, AI datacenters are just a stepping stone that’s conveniently propping up oil and gas and even coal while they evacuate their money from the collapsing building.
Yeah, its an expensive nation building project.
TIL oil pipelines can be repurposed, so maybe they can have some life when demand drops in the coming years?
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Once it’s been contaminated with hydrocarbon sludge, what’s it useful for next?
It’s not like it’s rail, where after we’re done with it we’d have excellent track going from YEW to YVR.
I keep hoping one day someone somewhere will adopt Carbon Engineering’s synthetic methane (syn gas) production from air capture technology. They’re a company out of BC. If we overbuilt on renewable and converted the excess power into SynGas we could easily make up the last sticky 5% of situations we still need hydrocarbon fuel for with carbon neutral fuel. You can liquefy SynGas the same way you make LNG so we could even still export it. It would take some retrofitting, but converting those DilBit pipes to SynGas pipes is actually not that hard.
From the lack of private funding, I assume the projected ROI for the pipeline is not good.
Trans mountain made 12.6 billion at a cost of 34 billion. It’s believed any new pipeline won’t be anywhere near as successful.
Note that 12.6 is estimated oil revenue, not tax revenue.
Okay, so according to the trans mountain pipeline corporation, it returned 1.7B to the owner in 2025 and 0.45B in Q1 2026.
It says that the forecasted dividends for the coming years are higher. I’m not sure how they forecasted this, but whatever.
They also talk about some “optimization program” to increase throughput volumes by 30%.
Regardless, let’s say the average revenue goes to around 2B per year. In that case, it would require around 20 years to break even (considering the 4.5B + 34B put in by the feds). Everything after that is profit.
Buuuut yeah, I don’t have data on projected oil demand till 2046. And constructing ANOTHER megaproject in addition to this one… Yeeeeah I dunno…
They like putting up business studies and projected revenues and all that for everything. Why not for the new pipeline? That’s just so unprofessional and irresponsible.
