Tag Archives: Petro-Canada

Will Canada’s oil boom be an environmental bust? The new global wasteland?


Alberta the new oil wasteland

Alberta the new oil wasteland

FORT MCMURRAY, Alberta (AP) — The largest dump truck in the world is parked under a massive mechanical shovel waiting to transport 400 tons of oily sand at an open pit mine in the northern reaches of Alberta. Each Caterpillar 797B heavy hauler — three-stories high, with tires twice as tall as the average man — carries the equivalent of 200 barrels.

Shell, which has 35 of the massive loaders working 24 hours a day, 7 days a week, has ordered 16 more — at $5 million each — as it expands its open pit mines. And it is not alone among major oil companies rushing to exploit Alberta’s oil sands, which make Canada one of the few countries that can significantly ramp up oil production amid the decline in conventional reserves.

Shell, Exxon-Mobil, Chevron, Canada’s Imperial and other companies plan to strip an area here the size of New York state that could yield as much as 175 billion barrels of oil. Daily production of 1.2 million barrels from the oil sands is expected to nearly triple to 3.5 million barrels in 2020. Overall, Alberta has more oil than Venezuela, Russia or Iran. Only Saudi Arabia has more.

High prices — a barrel reached almost $150 last month and is around $115 now — are fueling the province’s oil boom. Since it’s costly to extract oil from the sands, using the process on a widespread basis began to make sense only when crude prices started skyrocketing earlier this century.

But the enormous amount of energy and water needed in the extraction process has raised fears among scientists, environmentalists and officials in an aboriginal town 170 miles downstream from Fort McMurray. The critics say the growing operations by major oil companies will increase greenhouse gas emissions and threaten Alberta’s rivers and forests.

“Their projected rates of expansion are so fast that we don’t have a hope in hell of reducing greenhouse gas emissions,” said Dr. David Schindler, an environmental scientist at the University of Alberta.

Oil sands operations, including extraction and processing, are responsible for 4 percent of Canada’s greenhouse gas emissions, and that’s expected to triple to 12 percent by 2020. Oil sand mining is Canada’s fastest growing source of greenhouse gases and is one reason it reneged on its Kyoto Protocol commitments. Experts say producing a barrel of oil from sands results in emissions three times greater than a conventional barrel of oil.

Worries about environmental damage have gotten enough attention that even the oil industry realizes it must tread softly on the issue. “Industry has to improve its environmental performance,” Brian Maynard, a vice president of the Canadian Association of Petroleum Producers, said recently.

Questions about developing Alberta’s oil sands have seeped into the U.S. presidential campaign and the debate in Canada and the U.S. over keeping down the price of gasoline while still protecting the environment.

The Bush administration sees Alberta as a reliable source of energy that will help reduce reliance on Middle East oil. U.S. Ambassador to Canada David Wilkins said the oil sands will define the relationship between the two countries for the next 10 years.

“We are blessed by the fact that our friend and neighbor is also our number one supplier of foreign oil,” Wilkins told The Associated Press.

However, Democratic presidential candidate Barack Obama’s top energy adviser said oil sands emissions are “unacceptably high” and may run counter to Obama’s plan to shift the U.S. away from carbon-intensive fossil fuels.

“The amount of energy that you have to use to get that oil out of the ground is such that it actually creates a much greater impact on climate change, as well as using much more energy than even traditional petroleum,” Obama adviser Jason Grumet said.

Mining oil sands also was criticized by American mayors in a resolution adopted at their annual conference in June urging a ban on using oil sands-derived gasoline in municipal vehicles. They alleged the oil sands mines damage Canada’s boreal forest — boreal refers to the earth’s northern zone — and slows the transition to cleaner energy sources in the U.S.

John Baird, Canada’s environment minister, warned that Washington would lose energy security if it doesn’t take Alberta’s oil.

“If American mayors want to send their money to unstable, undemocratic countries in the Middle East instead of to Canada, that will be their call. If they want to pay a premium for Iranian, Saudi, Iraqi oil that will be their call,” Baird told the AP.

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Stupid to the last drop – Alberta oil thirst leading to disaster


The author of a new book on the future of Canada’s oil industry says Alberta is destroying itself in its rush to extract every drop of fossil fuel from the oilsands.William Marsden, a Montreal journalist and author of “Stupid to the Last Drop: How Alberta is Bringing Environmental Armageddon to Canada (And Doesn’t Seem to Care).

Read an excerpt from ‘Stupid to the Last Drop’

He says Alberta is giving up control of its oil assets to foreign investors and private business, with little effort to ensure its economic or environmental future is protected.

“This is really crazy what’s happening in Alberta today. We have a province that is actually destroying itself in the effort to get every last drop of oil and gas out,” Marsden says.

“We’re shipping it to the United States — 60 per cent of our production — at a time when Canada looks, and the whole world looks, like we’re beginning to run out of oil. And we will need these reserves in the long-term.”

He said experts estimate there are about one trillion barrels of oil in the world today. Those are being used up at a rate of about 30 or 31 billion per year, and rising. At that speed, the reserves will dry up in about 65 years unless additional reserves are discovered, Marsden says.

He predicts the approach of a transition period, where the world will shift towards using new types of fuel as global supplies begin to run out.

To prepare for that, Marsden suggests Canada needs to begin stockpiling fuel in order to guarantee a successful transition through that period. At the moment, however, that isn’t happening.

“We’ve basically given it over to private industry, most of which is foreign, so the vast majority of the profits are going to private industry,” Marsden said.

“So we won’t even have the kind of treasury that we will need as we enter into this new age to smooth over this transition.”

He said Canadians don’t seem to realize how dire the situation really is and many believe there is no reason to question the status quo.

“It’s almost sort of the politics of our age where we continue to think that it’s business as usual,” Marsden said.

“I mean, Canadians are looking at Alberta and thinking to themselves, we have vast reserves there, there’s no problem. In fact, we don’t have vast reserves. We’re running out of conventional oil and gas. Within 10 years Canadians could see a fairly serious deficit in gas which is going to affect millions of homes and industries.”

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