“Greening of Canadian Oil Sands: A View Across the Border”


With the recent protests against the Keystone XL tar sands pipeline and the State Department’s favorable environmental impact assessment, it was with great interest that CSW turned to the September 15 teleconference co-sponsored by the Environmental Law Institute and Gowling Lafleur Henderson LLP.  The telecon addressed tar sands extraction from the Canadian perspective and illustrated that the controversy is also intense across the border.

Post by Katherine O’Konski

The telecon offered insight from a provincial government regulator, a lawyer practicing in Alberta’s environmental regulatory law, industry interests, and an independent environmental think tank. Access the Environmental Law Institute’s event page with links to the accompanying PowerPoint presentations here; a recording of the conference here.

Although Canadians have made some commitments to combat climate change (e.g., their ratification of the Kyoto Protocol and Alberta’s greenhouse gas emissions legislation), industry interests pushing forward on extraction are dominating climate concerns and leaving Alberta’s regulators struggling to successfully implement their policies.

Lisa Jamieson, Senior Environmental Counsel at Gowling Lafleur Henderson LLP opened the telecon by explaining that Alberta features a “cradle to grave” system of regulation.  Regulations dictate application and approval processes as well as reporting requirements, GHG emissions management, and reclamation requirements.  Alberta is the first jurisdiction in North America to implement legislation addressing GHG management for large industrial facilities.  The Climate Change and Emissions Management Act requires all facilities in Alberta that emit more than 100,000 tonnes of GHG per year to limit emissions – either by improving the energy efficiency of operations, buying carbon credits in the Alberta-based offset system, or paying $15 into the Climate Change and Emissions Management Fund for every tonne over the reduction target.  Established facilities cannot exceed 88% of the baseline emissions intensity, while new facilities are required to reduce emissions by 2% per year between the 4th and 8th years of operation.  To date, 11 million tonnes of offsets have been traded, $257 million paid to the Management Fund, and 23.8 million tonnes of GHG reduction have been avoided through changes in operations and efficiency increases.

While the Energy Resources Conservation Board oversees applications and ensures that resources are extracted efficiently and safely, it is the role of Alberta Environment to make sure the impacts of this extraction are as low as possible.  Lisa Sadownik, Section Head of Clean Energy Policy at Alberta Environment, stressed the province’s focus on “cumulative effects management.”  The goal of this strategy is to set regional limits on the effects of development upon air, land and water.  The dual focus (on extraction facilities themselves and the region as a whole) allows for a more accurate understanding of the environmental impacts of extraction.  Alberta Environment has developed indicators and management strategies for air quality, groundwater, surface water, biodiversity, and land use for the Athabasca oil sands regions.  In addition, innovations in tailings pond management and regulations that increase reclamation rates while reducing tailings themselves are due for 2012.

Tim Shipton, for the Alberta Enterprise Group, characterized the relationship between industry and the provincial and federal governments as cooperative. His comments, although nowhere near as extreme, called to mind attitudes CSW has seen presented by industry interests in Congress and on television.

“Industry is supportive of an enhanced regulatory regime so long as there is clarity, fairness, streamlined regulations, and harmonization between the province and the federal government,” he said.  All in all, he maintained that regulation should be as predictable as possible, and made with the intention to minimize impacts to industry.  “These projects are massive in size and development,” he said.  “They require as much certainty and financial capital as possible.”

The tar sands, he continued, will add hundreds of thousands of jobs to the Canadian and US economies, and add $1.7 trillion to Canada’s GDP over the next 25 years.  And since the extraction technology is still evolving, there will only be increases in efficiency in the amount of natural gas and water necessary for extraction.  Add to this that industry is speeding up reclamation of tailings ponds though the Oil Sands Tailing Consortium (a collaboration of the mining companies to share tailings resource and technology) and it would seem that the industry could do no wrong.

Well, we’ve all heard this from industry reps before.  But his most interesting comment by far was his assessment of US influence on the development of the tar sands.  “The US is so far our only market; I believe the US will ultimately support [the Keystone Pipeline] with legislation.”  Going even further, he stated that economic reality has trumped Obama’s green agenda.

Jennifer Grant of the Pembina Institute brought a startling perspective, citing the pace and scale of tar sands development in the absence of environmental limits.  The industry’s goal to extract 1 million barrels per day was achieved in 2004, a full sixteen years ahead of schedule.  With this huge growth in such a short time, Alberta’s regulatory system has not been able to keep pace.  The Royal Society of Canada, a national academy that among other things provides advice to governments, found in its assessment of the tar sands that “reclamation is not keeping up with the rate of disturbance.”

Furthermore, Alberta’s carbon capture and storage plans have not been implemented – and, Ms. Grant stressed, there is no likelihood of implementation without stricter regulations and incentives.  GHG reduction targets are unlikely to be reached; the entire projected increase in the country’s GHG emissions by 2020 is attributed solely to the tar sands.  As for Mr. Shipton’s claims about increasing efficiency, she contended that the scale of increase in extraction will increase so markedly as to completely negate any emissions saved through better technology.

Even in the handling of tailings ponds, things are not what they seem.  There are currently 223 billion gallons of tailings waste, covering 166 square miles.  7 out of 9 mines are not in compliance with Alberta’s tailings regulations outlined in Directive 074. And the regulations themselves, she explained, are overly flexible.  Among other things, they do not address toxicity, and there is no consideration of how to address new mines.

“Business as usual expansion of oil sands isn’t acceptable” Ms. Grant stressed.  “The oil sands do not solve US security issues; the US, as Canada’s number one customer, should use its influence to demand a more responsible product.”  This conclusion, although the most valuable message of the telecon, falls short of the commitments CSW knows are necessary to avert the potentially disastrous consequences associated with tar sands exploitation and Keystone XL.

Neither the tar sands’ nor the pipeline’s implications for climate change was addressed in the telecon. This indicates that the most pressing reasons to prevent US involvement in the project are not being adequately acknowledged.  That this is so even in an event sponsored by an environmentally minded organization, is particularly of concern. As Jim Hansen stated in his essay on the proposed pipeline:

“An overwhelming objection is that the exploitation of tar sands would make it implausible to stabilize climate and avoid disastrous global climate impacts … governments are acting as if they are oblivious to the fact that there is a limit on how much fossil fuel carbon we can put into the air.”

In the absence of credible climate policy and commitments to lower GHG emissions, Americans need to do more than “demand a more responsible product” from the tar sands.  That development of the resource has already begun cannot be helped.  But it is imperative that Americans and Canadians alike acknowledge that investing in infrastructure that supports a long-term commitment to exploit this emissions-heavy resource is hugely disadvantageous from the standpoint of transitioning to a renewable energy economy. … Not to mention its ominous implications for the health of both human and non-human communities.

Earlier posts:

Jim Hansen arrest at White House tar sands pipeline protest: “We had a dream”

Letter from scientists calling on Obama to block the Keystone XL tar sands oil pipeline



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