Hi all,

I usually sign in on a very sporadic once to twice per year basis to the off topic forum. However I see that the CLL forum is changing on weekends, it has become a little bit more open to off topic research and comments that might have some pertinence to our company.

First to those that do not think that China is an economy that is not growing, in comparison to others, please look at January auto production. As reported by Automotive News and Automotive World, in spite of their 20.6% drop from the previous January, they still produced 658,000 cars last month compared to US at 104,137 units and North American total (US, Canada, & Mexico) of 442, 241 vehicles. Yes that does mean Chinas total January 2009 production was lower than January 2008, but it still surpassed that of the entire North American continent. Do you wonder why there are rumors as to China’s tying up oil production in Venezuela as well as deals they have with Sudan and others in oil production areas? They have 1 Billion people and any of us that have been there can attest that every visit (mine are about every 2-3 years) brings more change witnessed by a growing middle class who want all the niceties of North America, up to and including automobiles that clog their needing to be expanded roads and highway networks.

Within British Columbia there is increased TV soft advertising by Enbridge, the pipeline company proposing the Northern Gateway Pipelines (http://www.northerngateway.ca/). This advertising is aimed at demonstrating how socially responsible that Enbridge is by helping Northern communities and the aboriginal youth with their skill based training and resulting employment opportunities. In my mind a smart move to educate the population prior to a provincial election and then being able to make application for pipeline right-of-way access from provincial government. After all they are socially responsible, train the youth of the North and will provide employment. The market of course for their pipelines are Asia and the growing number of cars on the road. By the way China does not have a large fleet of older vehicles that get replaced with new; they are building new gasoline powered vehicles on new gasoline powered vehicles with few “junkers” clogging the roads. I might add this is not Enbridge’s highest priority, but this is a company with a long range view of their company pipeline and corporate delivery systems.

The other observation that I would like to put forward is the whole area of “greening” of the carbon footprint. We all know that a significant part of President Obama’s announcement while in Canada was that of establishing a US-Canada clean energy dialogue, a significant benefit to us Connacher shareholders. President Obama has a significant carbon problem in the Kentucky Appalachian coal fields, while Prime Minister Harper has the carbon problem in the Oil Sands. The Green Car Congress reports “The two leaders discussed practical ways the United States and Canada could encourage the development of clean energy technologies to reduce greenhouse gases and combat climate change.

US and Canadian officials will meet in the coming weeks to launch the clean energy dialogue.”

If this discussion would then be translated into addressing means of the two sectors (coal and oil) reducing their carbon through such things as the proposed, put on hold Connacher Co-energy (SAGD steam to electricity), we will be onto a comeback. Will there be government incentives towards this type of initiative that will produce more power without increasing the carbon footprint? I don’t know, but I certainly am more confident that it will because the other leg of the agreement between the two leaders was “ Building a more efficient electric grid based on clean and renewable generation.” What is cleaner and efficient than co-generation? It also provides a quick stimulus towards producing more jobs at little cost, something both leaders, particularly within the US, are need of demonstrating.

I guess in summary, through my rose colored perspective I view that there is a change toward greater optimism for CLL longs. There is a growing Asian gasoline market and there is going to be a growing cleaner North American carbon market, both of which will benefit an integrated oil company like Connacher.

A few thoughts, cheers all,

MIFireE