Oct. 12, 2018

WESTERN CANADIAN SELECT (WCS) ‘DISCOUNT’ – TRAVIS WOOD AND DAN PAYNE, NATIONAL BANK FINANCIAL

  • Western Canadian Select discount is nearly $50 US per bbl vs an historical average of $15.
  • With WTI at $71, Alberta producers are getting only $21 US per bbl for new production.
  • Alberta’s oil production continues to reach new highs.
  • Western Canadian pipelines are at capacity.
  • Limited ability to add rail capacity (currently 200,000 bbl/d with potential to reach 300,000 bbl/d by late 2019).
  • Storage in Alberta is effectively full.
  • Refinery turnaround season is under-way; short-term demand is approximately 980,000 bbl/day
  • Additional pipeline capacity of 825,000 bbl/d (Enbridge Line 3 and Mainline) won’t be completed for 14-18 months.
  • China bought 1.58 million barrels of heavy Canadian crude oil for December, up 50% from April.
  • IEA says Q3 global oil supply rose to 100.3 million bbl/d, up 2.3 million bbl/d Y/Y vs current demand of 98.45 million bbl/d.

MENTAL HEALTH COMMISSION OF CANADA

  • 7.5 million (1 in 5) Canadians live with a mental health problem or illness; more than the population of our 13 capital cities combined and 2x the number of Canadians with heart disease or type 2 diabetes.
    • More than 900,000 adolescents 13 to 19 live with a mental health problem.
    • Suicide is the second leading cause of death among ages 15-34 behind accidental death.
  • 1.6 million Canadians are not getting the care they require. This is costing the Canadian economy over $50 billion ($1,400 per Canadian in 2016).
  • Children’s Mental Health Centres have wait times as long as 18 months for long-term counselling and intensive therapy.
  • Wait times are up to 6 years for other related support services.
  • Economic impact from depression alone is upwards of $32.3 billion or more than 2x Canada’s spending on mental health and community care.
  • Impact of depression alone is greater than all of lung, colorectal, breast and prostate cancers combined.

CANNABIS BECOMES LEGAL OCTOBER 17th

  • More than 80% of Canadians have a liquor outlet within 5 km of where they live and more than 90% within 10 km of home.
  • In Q4 2018, 25% will have access to cannabis within the 5 km and 35% within 10 km.
  • BC leads the country and expects that 73% of population will have access to Cannabis.
  • Quebec will be the most restrictive. The new CAQ government has promised a ban on cannabis use in public and is increasing consumption age to 21 from 19.
  • Consumption age is 19 in Ontario and BC and 18 in Alberta.