IT'S NOT JUST EASTERN CANADIANS WHO'LL FREEZE IN THE DARK: Missing but Badly Needed-A Canada-First Energy Policy

By Laxer, Gordon | CCPA Monitor, November 2006 | Go to article overview

IT'S NOT JUST EASTERN CANADIANS WHO'LL FREEZE IN THE DARK: Missing but Badly Needed-A Canada-First Energy Policy


Laxer, Gordon, CCPA Monitor


On March 8, Alberta Premier Ralph Klein made a remarkable and admirable pledge.

"If we see oil drying up and we see the Alberta supply being threatened and the Canadian supply being threatened, we can do whatever is necessary to ensure that Canada receives its supplies first."

To show that this astonishing promise was not one of the premier's famous offhand comments, two ministers echoed Klein's remarks. "When we look at the long-term need for Alberta and Canada," stated Energy Minister Greg Melchin, "those are first and paramount."

Environment Minister Guy Boutilier chimed in that "we want to ensure that we supply the needs of Canadians."

These are the kinds of generous promises to fellow citizens in other provinces we would expect from Alberta's political leaders. But they are not Alberta's nor Canada's present policies. They should be.

Premier Klein and his ministers made these promises in response to a report released by the Parkland Institute, the Canadian Centre for Policy Alternatives, and the Polaris Institute. Entitled Fuelling Fortress America, a report on the development of the Athabasca tar sands written by Hugh McCullum, it warned that Canada was running out of conventional oil-fewer than 10 years' supply left-and that tar sands oil came at too high a cost environmentally, socially, and in the billions of dollars in royalties forgone to the big, foreign-owned transnationals.

Responding to the report, Premier Klein first claimed that there is "a 300-year supply of oil in the tar sands," before making the Canada-first oil pledge. Similarly, Boutilier added that "there's a lot of oil to go around."

Indeed, Alberta does have plenty of oil, more than enough to meet Eastern Canadians' needs and export the surpluses.

But Alberta cannot supply Eastern Canada, even if a crisis hit and they were freezing in the dark, because NAFTA reserves Alberta's oil for Americans' security of supply. Although Canada is a net exporter of oil, we import almost one million barrels per day to meet 90% of Quebec's and Atlantic Canada's needs, and 40% of Ontario's.

At the same time, Canada exports 63% of its oil and 56% of its natural gas production to the U.S. Those export levels are currently locked in place by NAFTA's proportionality clause, which states that Canada must continue exporting the same proportion of oil and gas as in the past three years, even if Canadians run short. As well, there is not sufficient, east-west pipeline capacity to fully meet Eastern needs.

How can we make good on Klein's pledge of March 8?

As an increasingly influential province, and home to most of the oil in Canada, Alberta has national leadership responsibilities. The tar sands will soon produce more than half of Canada's oil. Yet 75% of that output is exported.

"Oil security," "oil independence," and even "domestic ownership" are frequently discussed in the United States and other countries, but not in Alberta or Canada. They should be front and centre in any discussions on the future of the tar sands.

We must ask questions about the big picture. What is the purpose of developing tar sands oil? Who will receive it? Will it be there for Canadians when the next oil supply crisis hits? How can Alberta play a leading role in Canada and the world in reducing greenhouse gases?

Security of supply for Canadians is the key to today's most important energy issues: political instability, climate change, NAFTA's proportionality clause, and planning for peak oil.

Political instability: Last year, 42% of Canada's oil imports came from the North Sea, with 26% from Norway alone. North Sea oil is secure, but it is a declining field. Imports dropped 6 percentage points from 2004, but OPEC accounts for the same proportion of Canadian imports: 41%. Algeria, Saudi Arabia and Iraq head the list. Imports of liquefied natural gas are still fairly negligible, but at the July G-8 meetings in St. …

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