Oilweek Online

N.B. Liberals express concerns with proposed utility sale to Hydro Quebec (NB-Power-Liberals)

FREDERICTON _ New Brunswick`s Liberal government still has some work to do to sell members of its own party on the proposed sale of NB Power to Hydro-Quebec.The majority of the two dozen delegates asking questions Saturday during a session at the party`s biennial meeting in Fredericton expressed concerns with the $5-billion deal.I have serious, serious doubts, said Tom Gilbert, a long-time party member from Burton, N.B.Let people get the full story, even if you have to go to an election.The province has signed a memorandum of understanding that would see Hydro-Quebec assume the major assets of the utility, including transmission lines and the Point Lepreau nuclear power plant.While some delegates applauded the deal and the resulting 40 per cent cut in the provincial debt, others said they worried about the long-term effects of selling the utility.I have reviewed the memorandum of understanding in some depth and I have concluded that it is a poor deal, fraught with uncertainty and whatever its short-term benefits it is not in the long-term best interests of New Brunswickers, said delegate Drew Speight during the question period.But Premier Shawn Graham defended the deal, saying that the status quo would result in rising power rates and dependency on oil from the Middle East and coal from South America.Today with this transaction, rather than being dictated by these other countries, we are tying our energy security and future to our next door neighbour with the cheapest source of hydro power in North America and the most stable country in the world, Graham said.One delegate pointed out that Graham didn`t have a mandate to sell the utility because he campaigned on not privatizing NB Power during the provincial election campaign in 2006.My opinion changed, said Graham, and I couldn`t allow this opportunity to pass our province by.Graham said he was elected to make tough decisions and believes the deal is in the best interest of New Brunswickers.Graham said he`s already hearing from business and industry about the growth opportunities as a result of power rates.The accountability session lasted more than 90 minutes.It was fair, it was good and it was constructive, said Energy Minister Jack Keir. Folks have questions and it was another opportunity for us to get some of the facts out there on exactly where we are going.But Opposition Conservative critic Dale Graham said the dissatisfaction within the Liberal ranks is just an example of the feeling of all New Brunswickers.People are angry, and they feel like this has all been done behind closed doors, he said.It`s not clear what will happen to jobs at NB Power, and it`s not clear what will happen to power rates after the first five years are up.The power agreement is expected to dominate the upcoming session of the New Brunswick legislature which opens Tuesday with a speech from the throne.

Geothermal energy company Magma loses US$2.7 million in first quarter as company builds business (Magma-Energy)

VANCOUVER _ Magma Energy Corp. (TSX:MXY), a Vancouver-based geothermal energy producer, reports it lost nearly US$2.7 million or one cent a share in the fiscal first quarter ended Sept. 30. That compared with a loss of $829,860 or one cent for the same year earlier period.Revenues from energy sales were just over $1 million in the quarter, the first three-month period of the energy producer`s 2010 fiscal year, the company reported. Magma generated no operating revenue for the same period a year earlier.Ross Beaty, chairman and CEO, said Magma grew quickly in the latest quarter, with acquisitions in Iceland, Nevada and a promising exploration succees in South America, as well as the company`s initial public offering.We completed our initial public offering on July 7, which raised $88 million net of costs, said Beaty. We also added seven new geothermal exploration properties in Nevada, announced discovery of a 140 megawatt geothermal resource on our Maule property, Chile, and entered into agreements in Iceland that, when completed, will result in Magma becoming a 43 per cent owner of Iceland`s largest private geothermal power company.These transactions will all help us achieve our mission of becoming one of the world`s pre-eminent geothermal power producing companies.Magma Energy has one operating power generation plant, the Soda Lake operation in Nevada, and an extensive portfolio of exploration properties throughout the western United States and Latin America.

N.B. Liberals express concerns with proposed utility sale to Hydro Quebec (NB-Power-Liberals)

FREDERICTON _ New Brunswick`s Liberal government still has some work to do to sell members of its own party on the proposed sale of NB Power to Hydro-Quebec.A majority of the delegates asking questions today during a session at the party`s biennial meeting expressed concerns with the $5 billion deal.The province has signed a memorandum of understanding that would see Hydro-Quebec assume the major assets of the utility, including transmission lines and the Point Lepreau nuclear power plant.While some delegates applauded the deal and the resulting 40 per cent cut in the provincial debt, others said they worried about the long-term effects of selling the utility.One man called it a poor deal fraught with uncertainty, while another said the deal should be put to voters during next September`s provincial election.Premier Shawn Graham says he was elected to make tough decisions and believes the deal is in the best interest of New Brunswickers.

Federal environment minister says cut emissions, but not at economic cost (Prentice-Copenhagen)

EDMONTON _ Canada`s environment minister says Canada is ready to talk climate change with the rest of the world but will also make sure Alberta`s oilsands keep rolling along.Jim Prentice spoke to the Edmonton Chamber of Commerce on Friday, explaining what Canada will negotiate for at a coming climate-change summit in Copenhagen.Prentice says both Canada and the United States will be aiming for a goal of reducing greenhouse gas emissions as quickly as possible without killing the economy.Environmental groups such as Greenpeace protested outside Prentice`s speech, saying they want to see the targets for reducing greenhouse gas emissions made much higher.(CTV Edmonton)

Harvest Energy reports $713.7 million Q3 loss on goodwill charge, revenue down (Harvest-Energy)

CALGARY _ Harvest Energy (TSX:HTE.UN) said Friday it lost $713.7 million in its latest quarter on a $677.6-million charge to goodwill.The company, which agreed last month to be taken over by a South Korean energy firm in a $4.1-billion cash-and-debt deal, said the loss amounted to $3.95 per diluted unit for the quarter ended Sept. 30 compared with a profit of $295.8 million or $1.73 per diluted unit a year ago.Revenue totalled $991.9 million, down from $1.6 billion.Harvest, which produces oil in Western Canadian and operates the Come By Chance refinery in Newfoundland, has agreed to be bought by the state-owned Korea National Oil Corp.The deal will be South Korea`s biggest acquisition of a foreign oil firm as it seeks to secure new sources of energy and grow in North America.

Oil sands company UTS Energy reports $4.7 million third quarter loss (UTS-Energy)

CALGARY _ UTS Energy Corp. (TSX:UTS) said Friday it lost $4.7 million in its latest quarter compared with a loss of $936,000 a year ago.The junior oil sands company said the loss for the quarter ended Sept. 30 amounted to a penny per share compared with a loss of $936,000 or 0.2 cents per share a year ago.Revenue totalled $205,000, down from $3 million.Last week, UTS announced plans to sell its half-interest in three northern Alberta properties to Imperial Oil Ltd. (TSX:IMO) and its parent ExxonMobil Corp. (NYSE:XOM), freeing up $200 million for other projects in the region.The land package, east of the Firebag River in northeastern Alberta, includes Lease 421, which UTS acquired in a land sale in late 2006. The two adjacent leases, Nos. 022 and 023, were purchased in the 2008-09 winter season.Control of the Lease 421 area is split evenly between UTS and Vancouver-based miner Teck Resources Ltd. (TSX:TCK.B).UTS expects its after-tax proceeds will be $200 million, or $250 million before taxes.UTS has a 20 per cent stake in the Fort Hills project, which was put on hold around a year ago in the midst of soaring costs and plummeting oil prices.Suncor Energy Inc. (TSX:SU) holds the controlling 60 per cent stake, which had been Petro-Canada`s before those two companies merged in August. Teck has the remaining 20 per cent interest.

Exporters look outside weak U.S. for foreign markets to boost exports (Trade-Economy)

OTTAWA _ Canadian companies are taking full advantage of the improving global economy by diversifying exports, giving hope that a more sustained recovery could take hold in Canada.Policy-makers and private sector economists have long highlighted crumbling exports, particularly in forestry and manufacturing, as the weak link in the fragile recovery.But Statistics Canada reported Friday the country`s export sector increased sales by a surprisingly strong 3.5 per cent in September to $30.3 billion, the third gain in four months after almost a year of declines.That sliced the country`s merchandise trade deficit by more than a half to $927 million from $2 billion in August, the agency said.The showing from exporters will be enough to allow Canada to post some growth and officially come out of the recession in the third quarter, said economist Krishen Rangasamy of CIBC World Markets.Economists point out that the latest increase still leaves Canadian exports down 28 per cent from a year ago.The biggest surprise in September was that the export sector _ which represents about 35 per cent of the economy _ was able to do it without help from the United States, still Canada`s biggest market.The agency said 88 per cent of the improvement involved overseas exports, 34 per cent of it going to Europe.The development, if it holds, is welcome news for Canadian manufacturers and other exporters because the U.S. domestic economy is expected to remain on its knees for some time.We`ve become less dependent on the U.S. market over the last several years, said Peter Hall of Export Development Canada.One month does not a trend make, but it`s very heartening to see that something that was already in the works seems to have resumed.One reason that exporters are finding overseas markets more receptive is that while the Canadian dollar has risen against the U.S. greenback, it has remained mostly flat against other currencies. So the strong loonie is not inflating the price of exports in Europe or Asia.As well, demand in Asia and Europe has been recovering faster and more broadly than in the United States, where households are still trying to cope with a mountain of debt and rising unemployment.Meanwhile, China has emerged as the growth engine of the world and although still struggling, Europe`s statistical agency said Friday that the 27-country grouping had finally turned the corner on the recession and posted a 0.4 per cent advance in the third quarter.The question, say economists, is whether Canadian exporters can further cut the umbilical chord with the U.S., which still absorbs some three-quarters of Canada`s foreign sales.It would benefit Canada to diversify the destinations of its exports, with U.S. demand looking to recover only gradually, noted Grant Bishop of the TD Bank.However, Bishop said exporters will need to improve productivity in order to keep competing internationally, especially if the loonie keeps strengthening as many predict.Another hurdle is that it appears that the recent export gain is largely due to temporary factors, such as the need for foreign customers to replenish inventories, said Rangasamy.The outsized 16 per cent increase in auto industry exports was also largely supported by the lucrative cash-for-clunkers government inducement in the U.S., which has been discontinued.Exports are going to be a positive for the economy in the third and fourth quarter this year, but next year is going to be a different story, Rangasamy said.Canadian exporters will have to contend with a very strong Canadian dollar and a U.S. economy going back below par growth and (with) no inventories to re-fill.The EDC has forecast that exports will remain weak next year, well below pre-recessionary levels.

Hydro Quebec eyeing P.E.I. power deal, weeks after swallowing N.B. utility (Hydro-Quebec-PEI)

BOSTON _ Quebec Premier Jean Charest confirmed that talks were underway toward a possible energy deal with Prince Edward Island and argued Friday that such an agreement would benefit the entire region.The announcement in a speech to a U.S. audience came two weeks after Hydro-Quebec swallowed up New Brunswick`s power utility in a controversial, multibillion-dollar deal.Speaking at an energy conference in Boston, Charest said a deal would create a stronger energy market in Eastern Canada. He said Quebec, New Brunswick and P.E.I. are holding three-party discussions.It would be very good for Prince Edward Island, Charest said.It would also be a strategic opportunity for us to create an energy hub. . . It would make sense for all three of us to work together in developing that energy hub.Charest said the deal would comprise 100 megawatts of electricity and would have the added benefit of reducing greenhouse-gas emissions in P.E.I.In Charlottetown, P.E.I. Premier Robert Ghiz said he hopes the formal talks will lead to cheaper, greener power for his province`s residents.Islanders pays among the highest electricity rates in the county.Like many negotiations, there is no certainty of any outcome, Ghiz told the Charlottetown Guardian, reading from a prepared statement.The only certainty is in knowing failure to pursue new approaches is to accept the status quo and we all know the status quo is unacceptable.Hydro-Quebec reached a tentative agreement last month to buy New Brunswick`s public utility, NB Power.The New Brunswick deal would help Canada`s largest hydro producer export power to the energy-hungry northeastern U.S.The proposal has sparked opposition from the governments of Newfoundland and Nova Scotia, who fear for the future of their own power companies.Hydro-Quebec also announced Friday that its profits slipped to $338 million in the last quarter from $491 million a year earlier.The utility says that`s due to a drop in demand from Quebec`s industrial sector, and to last year`s favourable price conditions for exports.(The Canadian Press-Charlottetown Guardian)

Exporters look outside weak U.S. for foreign markets to boost exports (StatsCan-Trade)

OTTAWA _ Canadian companies are taking full advantage of the improving global economy by diversifying exports, giving hope that a more sustained recovery could take hold in Canada.Policy-makers and private sector economists have long highlighted crumbling exports, particularly in forestry and manufacturing, as the weak link in the fragile recovery.But Statistics Canada reported Friday the country`s export sector increased sales by a surprisingly strong 3.5 per cent in September to $30.3 billion, the third gain in four months after almost a year of declines.That sliced the country`s merchandise trade deficit by more than a half to $927 million from $2 billion in August, the agency said.The showing from exporters will be enough to allow Canada to post some growth and officially come out of the recession in the third quarter, said economist Krishen Rangasamy of CIBC World Markets.The biggest surprise in September was that the export sector _ which represents about 35 per cent of the economy _ was able to do it without help from the United States, still Canada`s biggest market.The agency said 88 per cent of the improvement involved overseas exports, 34 per cent of it going to Europe.The development, if it holds, is welcome news for Canadian manufacturers and other exporters because the U.S. domestic economy is expected to remain on its knees for some time.We`ve become less dependent on the U.S. market over the last several years, said Peter Hall of Export Development Canada.One month does not a trend make, but it`s very heartening to see that something that was already in the works seems to have resumed.One reason that exporters are finding overseas markets more receptive is that while the Canadian dollar has risen against the U.S. greenback, it has remained mostly flat against other currencies. So the strong loonie is not inflating the price of exports in Europe or Asia.As well, demand in Asia and Europe has been recovering faster and more broadly than in the United States, where households are still trying to cope with a mountain of debt and rising unemployment.Meanwhile, China has emerged as the growth engine of the world and although still struggling, Europe`s statistical agency said Friday that the 27-country grouping had finally turned the corner on the recession and posted a 0.4 per cent advance in the third quarter.The question, say economists, is whether Canadian exporters can further cut the umbilical chord with the U.S., which still absorbs some three-quarters of Canada`s foreign sales.It would benefit Canada to diversify the destinations of its exports, with U.S. demand looking to recover only gradually, noted Grant Bishop of the TD Bank.However, Bishop said exporters will need to improve productivity in order to keep competing internationally, especially if the loonie keeps strengthening as many predict.Another hurdle is that it appears that the recent export gain is largely due to temporary factors, such as the need for foreign customers to replenish inventories, said Rangasamy.The outsized 16 per cent increase in auto industry exports was also largely supported by the lucrative cash-for-clunkers government inducement in the U.S., which has been discontinued.Exports are going to be a positive for the economy in the third and fourth quarter this year, but next year is going to be a different story, Rangasamy said.Canadian exporters will have to contend with a very strong Canadian dollar and a U.S. economy going back below par growth and (with) no inventories to re-fill.The EDC has forecast that exports will remain weak next year, well below pre-recessionary levels.

Asia Bio Chem reports third quarter profits fall to $828,000 from more than $1.9 million (Asia-Bio-Chem)

TORONTO _ Asia Bio-Chem Group Corp. (TSXV:ABC), a Toronto-based company which produces cornstarch at plants in China, reports its third quarter net profits fell to $828,000 from more than $1.9 million in the same period a year earlier.Sales rose to $23.2 million from $21.5 million, while earnings per share dropped to one cent from three cents, the company reported Friday.The company said its sales were higher because of increased selling prices for starch, higher volumes and the improvement in the value of the Chinese currency against the Canadian Dollar.We are pleased to see that market conditions have begun to improve particularly for our starch product following a difficult first half, said Zhiping Wang, president and CEO of Asia Bio-Chem.With the completion of our new Daqing facility, our company is well positioned to take advantage of this improvement in demand.Asia Bio-Chem Group, through its wholly-owned subsidiaries in China, produces cornstarch and related byproducts. From its plants in Liaoning and Heilongjiang province, the company has a total processing capacity of 900,000 tonnes of corn.The company`s products include cornstarch, corn germ, gluten and fibre which are sold into the domestic Chinese market.In trading on the TSX Venture Exchange, Asia Bio-Chem shares fell two cents to $1.16.