RE:RE:RE:RE:Now we are getting somewhereOldnagger wrote: The future of the petroleum industry is related to what people require for their needs. Those needs for many people on this planet are very necessary in those same peoples eyes. People say one thing then do something else . I will try not to belabour the point but examples abound. Someone will fill that demand. Suncor and the rest of the Canadian Industry is best qualified and has a very high reserves level particularly of oil sands. To ignore the fact that during the whole history of the oil industry no suitable replacements have been found is wishful thinking . I am an engineer and I have spent a part of my career evaluating many of the same technologies that we are now supposed to believe will save us from the evils of hydrocarbons. The thing is increased efficiencies are always possible and they do come in many forms, But when you need high density transportable energy at a reasonable cost there are still only a limited number of choices and Suncor has the expertise to develop the main one ..
We used to have a joke in the industry about the media, If you believe they can do it better then get them to give a bid on it !!
Obscure1 wrote: The experts expect oil consumption to expand until 2030 and then remain flat to slightly down until 2040. After that, demand for oil will depend upon how fast and efficiently renewables or some other energy source can replace oil but it is expected that oil consumption will still hold at about 50% of current levels.
I don't know what the world is going to look like by the end of the century, but I bet it won't depend upon oil like it does today.
Western based major oil companies around the world have slammed the brakes on oil exploration and development. To that end, much like the Saudis, I expect SU to continue to produce every barrel equivalent that they can. However, SU's baseplant, the crown jewel of its assets, has a current life expectancy of 2035. Given the existing political climate, it is anything but a slam dunk that SU gets the permits to expand the site to provide another 25 years of production. Teck certainly found out the hard way.
The world continues to undergo mind boggling technilogical change. SU can either use its enviable cash flow position and understanding of energy to be at the leading edge of technology in its field, or join what will be a long list of dying companies in the oil industry. Failure to look into and plan for the future is the opposite of the voice of reason.
The market doesn't look back, it looks at what will be. So should SU.
I agree with you that the transition to a less carbon centric world will take a long time. I also agree with you that politicians around the world seem to be in such a rush to move in that direction without thought about how it will happen that they will certainly screw things up and perhaps in the interim actually make oil more valuable.
But I remember when I was young somebody invented this thing called a wheel and all my neighbours in the surrounding caves looked at it said "WTF that thing isn't very practical and what on earth can we do with it?" Don't underestimate human creativity. We are both old enough to have a seen a lot of change in our lifetimes.
As Rockefeller once said "Don't fight the tape". In the same vein don't fight where the world is going and go with the flow. Perception is reality and like or not SU is tagged with the label of dirty oil but they have the money to go with the flow in a big way and through an effective communications strategy throw off the label of "dirty oil" and become one of the "angels"
IMO, if they don't do this then the SP will languish despite great FCF and possibly great dividends. As I mentioned in earlier posts, I own shares and am prepared to buy more but they will need to show me that they are capable of doing the transition over the next few decades to a different kind of business. Unlike some investors, I am not married to the companies I own. I am not in them "for better or worse", just better or I am out.