In 2010, Canada’s Oil Became a Contentious American Energy Issue

This was the year the Canadian oil sands registered for the first time on the political and public radar in the U.S. — beyond the circle of green activists in the know.

Congressional members from both parties, farmers and ranchers fought a proposed Alberta-to-Texas pipeline that would double U.S. consumption of the crude. Federal agencies met with First Nations who urged against depending on the “dirty oil.” The prestigious U.S. Proceedings of National Academy of Sciences (PNAS) published an analysis on the toxic effects of the tarry sands.

Anti-oil sands groups campaigned with billboards to convince would-be tourists to “rethink” visiting Alberta. Hollywood mogul James Cameron used his star power to raise awareness of the industry’s environmental costs.

“The U.S. has been somewhat of a breakthrough in terms of awareness in 2010,” said Simon Dyer, policy director and former head of the oil sands program at the Pembina Institute, a Canadian environmental think tank.

Perhaps it was only a matter of time. America is Canada’s largest customer of the relatively high-carbon fuel. By 2030, it is projected to supply up to 36 percent of U.S. needs, up from 8 percent in 2009, according to estimates.

But most observers agree the BP PLC oil leak triggered the sudden attention. The worst accidental oil spill in history sent environmental security concerns soaring up the national energy agenda.

Keystone XL at Center of Post-BP Debate

“The BP disaster has catalyzed a lot of interest and concern around the whole idea of energy and oil in general,” Dyer told SolveClimate News.

Along with the offshore drilling industry, the 1,700-mile Keystone XL pipeline which Calgary-based TransCanada wants to build, became a focal point in the effort to protect America from future oil accidents.

The 35-inch petroleum pipeline would carry up to 900,000 barrels of crude per day from Alberta across six states to tankers off the Gulf Coast. It would cut through Montana, South Dakota, Nebraska, Kansas and Oklahoma to refineries in Texas, and crisscross the Ogallala Aquifer, which supplies 78 percent of the water supply and 83 percent of the water for irrigation in Nebraska.

Because the pipeline would cross an international border, the U.S. Department of State must either approve or reject the project.

Once a shoo-in for approval, the $7 billion pipeline found itself under increasing scrutiny after the BP oil spill.

In June, 50 House Democrats raised alarm over poor safety protocols proposed in the design. In October, Mike Johanns, Nebraska’s junior Republican senator, urged Secretary of State Hillary Clinton to reroute the pipe around the vulnerable aquifer.

Ben Nelson, the state’s senior Democratic senator, echoed the sentiment in a separate letter that also voiced deep concerns over Clinton’s seeming basis towards okaying the oil artery.

Around that time, 11 Democratic senators warned against a pipeline that would “significantly increase our dependence on this oil for decades.”

All the while, environmental groups helped to rally a grassroots effort of farm groups, ranchers and indigenous people in Nebraska, Texas and other states the pipeline would cross. (See our series of articles here.)

Interest is “exploding,” said Rachele Huennekens, a grassroots coordinator for Sierra Club. The group opened a hotline for landowners in Nebraska and Texas and is planning townhall meetings across the American heartland.

For some, the broad fight came as a surprise. “I don’t think that I came into 2010 expecting there to be a huge grassroots group in East Texas called ‘Stop Tar Sands Oil Pipelines,’” said Alex Moore, Friends of the Earth dirty fuel campaigner.

State Dept. Decision Any Day

A decision by the State Department is expected any day now. The agency will either fast-track approval with a final environmental impact statement (EIS) or release a supplemental draft EIS that would require a new public comment period.

Even if a final review is issued, federal agencies would have 90 days to weigh in.

In July, the U.S. Environmental Protection Agency gave the State Department’s draft environmental review the worst rating possible for the pipeline citing “inadequate information” and urging more analysis and public input.

In a Dec. 9 letter to Sen. Ben Nelson, Clinton said the department was conducting a “meticulous environmental review” and has “not made a decision.”

The oil industry has organized a campaign to push back against the broad negative publicity. Announced this month by the American Petroleum Institute, the effort will stress the “importance of oil sands to the energy mix critical to America’s economic future.”

Last week, 39 House members from 19 states called on Clinton to quickly approve the pipeline, which it says would deliver 13,000 good-paying jobs, millions of dollars in tax revenue and American energy security. Both the Alberta and Canadian governments and the oil industry have long argued that the oil from a friendly neighbor is a boon to North American and global security.

Environmental groups say their best weapon is in making the plain facts of oil sands development evident. “The more Americans seem to learn about tar sands oil and the plans to expand it, the more upset they’re getting,” Huennekens told SolveClimate News.

The U.S. EPA says that on a “well-to-wheels” basis, the bitumen extracted is 82 percent more carbon intensive than conventional oil. The agency’s estimate sits in a middle ground between varying claims surrounding the oil sands’ carbon footprint offered by industry and conservationists.

Water is another concern. The PNAS research found elevated levels of 13 toxic elements in the oil sands’ main water source, the Athabasca River.

Canadian Awareness Grows, Too

About the rising awareness, Moore told SolveClimate News: “The U.S. is catching up to the Canadian public.” But even Canada saw an explosion of interest in 2010.

“It really wasn’t an issue on the federal radar screen,” Dyer said. “It was an issue in Alberta,” but they were “not really substantively talking about the issues, or whether there’s any solution.”

“There’s been quite a change,” Dyer added, especially in the past several weeks.

In December, three separate reports in Canada concluded that both levels of government have mismanaged development of the oil sands, including one each from the federally appointed Oil Sands Advisory Panel and the Royal Society of Canada.

Their findings fly in the face of common claims by Alberta officials that oil sands criticism is an unfair attack on the industry and Canadians, environmentalists say.

“I think Canadians are starting to realize that perhaps governments haven’t been completely honest with them,” Dyer said.

While debate in 2010 seemed stuck at tallying the greenhouse gas impacts of bitumen mining, Dyer expects it to move next year to whether Ottawa and Alberta have “met due diligence in ensuring development proceeds responsibly.”

It is already happening. In the wake of the reports, federal and provincial governments vowed to step up environmental oversight of oil sands production.

Advocates want more, given that governments already agreed to double oil sands development.

“I think the governments of Canada and Alberta could demonstrate some credibility if they stop approving projects until we fix some of these problems that have come to light in 2010,” Dyer said.

Anti-Oil Sands Goes Global

Increasingly, the fight to slow oil sands investment is spreading worldwide.

“The reason the oil sands get a lot of attention is not only because they’re significant in of themselves, but because they represent the world’s first major foray into unconventional oil,” Dyer said.

“Certainly, there is a decision point, particularly around climate implications, if we continue to go down this path elsewhere in the world.”

The global supply of unconventional oil like bitumen and oil shale is set to rise from 1.7 million barrels per day in 2007 to 8.8 million in 2030, according to the International Energy Agency — equivalent to about 11 percent of total oil output.

Half of that will come from Canada. At least 85 percent of the world’s reserves of bitumen are buried under an England-sized stretch of land in Alberta — the second largest oil deposit in the world behind Saudi Arabia. Production is expected to grow from 1.3 million barrels per day in 2008 to 3 million barrels per day in 2018, the government says.

And while Alberta drives the boom, projects are at various stages of exploration in Madagascar, Jordan and the Republic of Congo, to the dismay of advocates already worried about resource grabs in poor countries.

An Italy-based group called the Campaign to Reform the World Bank, which targets financial backers of unconventional energy, is campaigning to get energy giant ENI to cancel plans to mine bitumen in oil-rich Congo.

Elena Gerebizza, development finance coordinator for the campaign, said the goal is to “to prevent this type of industrial activity from being exported to other countries where legislation is much weaker, or where people are still trying to have their human rights respected.”

The proposed project would sprawl 690 square miles in a country with virtually no environmental regulation. According to figures obtained by the campaign, up to 70 percent of the land is covered with primary rainforest, despite claims to the contrary by ENI.

“It’s in the exploration phase, but it’s moving quite quickly,” Gerebizza told SolveClimate News. The goal, she said, is to raise the profile of the project.

“The strength is in internationalizing the oil sands issue.”

Outside of North America, particularly in Europe, she said awareness is growing. “It’s still not a mainstream topic, but it’s becoming more popular.”