Third Quarter Industrial Boom Rockets Canada’s Economy Forward

October 3rd, 2013 | by Morris Beschloss | Comments

While Canada’s economy had been languishing earlier in the year due to a downturn in residential/commercial construction and a softening in commodity prices, the third quarter, ending September 30, is indicating a major comeback. This was forecasted by preliminary results from industrial activity and new factory orders forthcoming in August and September.

With “oil sands” from the Alberta Province’s Athabasca region nearing two million barrels per day, Prime Minister Steve Harper and his cabinet have given up on President Obama’s ongoing delay on the Trans-Canada XL oil pipeline. They are moving full speed ahead to complete the pipeline from Alberta’s “Fort McMurray” to Vancouver, for shipment to Southeast Asia. The potential order book for two million barrels per day, starting in 2014 , is already filled up from China, India and Vietnam, with the “waiting list” for next year growing larger every day.

To give even greater substance to the good fortune that has befallen Canada, Warren Buffett, the “investment wizard of Omaha,” has made an initial $500 million investment into “oil sands” production, with more promised to come. With no concern over the questionable “climate control” issue that has become the Obama Administration’s number one target, Buffett is following up the railroad transportation energy success he engineered previously in the U.S.; with a prospective interest in the seemingly unlimited “oil sands” availability, and Canada’s pipeline business, which needs substantial enlargement in the years ahead.

Ironically, the need for the Canada/U.S. XL oil pipeline is, at the same time, losing its importance on both sides of the border as “fracking” is well ahead of schedule and rapidly filling up U.S. refinery capacity, as its output may be doubling the Canadian “oil sands” volume within the upcoming multi-year time period.

Also, reliable sources have indicated that a massive domestic U.S. pipeline infrastructural rearrangement will get underway by early next year. This will attempt to bring up-to-date the transfer of natural gas and crude oil that has been awaiting a massive restructuring for years. Already Enbridge has reversed the flow of “crude” from the massive over-inventoried centrum, located in Cushing, Oklahoma, to refineries in Southern Louisiana and the Greater Houston area.

With the largest potential oil shale in the U. S., the Monterey shale in Western California, now under consideration, America’s 140-plus expanded and well-maintained oil refineries will have plenty of incoming domestic oil, and refined export derivatives demand to keep them busy in the months and years to come.

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