Shortly after the Deepwater Horizon oil spill in the Gulf of Mexico, which sent approximately 300 000 US gallons of oil gushing into the Atlantic Ocean, Republican Congressman John Culberson stated that oil spills of that magnitude is like an ” anomaly–like an airplane falling from the clear blue sky.” He was much derided for this comment and it was considered one of the greatest gaffes by any politician after the tragic spill. Yet, his statement held some truth. In a recent statement from the Conservative government, in an effort to promote oil sands pipeline projects, they bragged that 99.999 % of Canadian oil shipped via pipeline throughout this country or to the United States gets to its destination safely without any environmental impact whatsoever. Unfortunately, for Alberta Premier Alison Redford’s Conservative government, it is the .001 % of oil that does not get to its destination safely, along with other historical spills in the industry, that creates a public relations nightmare that have made promoting pipeline projects next to impossible.
As demand for oil goes up, and prices rise, major oil sands players continue to look for ways to pipe their product to upgraders, refineries or ports in the continent so that when they increase their production their commodities have somewhere to go. As of now, there have been three potential pipeline projects that have gained substantial publicity in the Canadian press. The most notable of these three is the Keystone XL project, which would move Albertan bitumen through Baker, Montana where it would mix with American oil from that region of the country before eventually reaching Steele City, Nebraska, where it would join an existing pipeline shipping oil to production facilities in Illinois. The second of these pipelines, the Enbridge Northern Gateway project, would ship oil sands product from Bruderheim, Alberta to Kitimat, British Columbia. The last and only unnamed one of these publicized projects would be a pipeline that would send oil to a refinery in Saint John, New Brunswick. All of these projects have gained a fair amount of publicity and generated much debate amongst supporters and opponents.
The Keystone XL project has by far generated the most publicity amongst the three potential projects. President Obama has seemingly flip flopped several times on the issue, at first being apprehensive due to a damning EPA report saying that not enough assessment had been done detailing how a large scale spill would be dealt with. Beyond this, the proposed routing of the piping indicated it would cross over Nebraska’s environmentally sensitive Sandhills region and the Ogallala Aquifer. The aquifer provides 30 percent of all irrigated water used in agriculture for the United States as well as drinking water for 2.3 million people. In response, TransCanada has suggested an alternative route that would avoid these sensitive areas. Since then, Nebraska Governor Dave Heineman has begun to vocally support the project. However, final approval from Obama is still in the waiting. However, the pipeline project also faces issues in Canada where many believe that the bitumen piped to the US should instead be refined domestically, thereby creating further jobs in Canada. However, with the strong backing of both Redford and Stephen Harper’s government, any political hindrance in Canada remains unlikely.
Just over a week ago, the final hearing took place for the Enbridge Northern Gateway project, which is still awaiting approval from Christy Clark’s Liberal government. The project would be a huge boon for the oil sands industry since it would open up the oil sands market to Asia and allow for more competitive pricing, since current product has to be sold at $8 less per barrel to the US. Environmental concerns have made the project deeply unpopular in British Columbia where many residents believe that if they are to assume the risk of piping the material to the coast they are entitled to royalties on the product. This is a compromise Redford refuses to meet. Beyond this, ardent opposition from native groups, particularly the Haida tribe, as well as Enbridge’s disastrous spill into the Kalamazoo River in Michigan in July, 2010 continue to stoke a public relations nightmare for the company. Like Keystone, it remains to be seen if this project will go ahead.
The third proposed project has really only been in the public eye because of recent voices of support from New Brunswick Premier David Alward, who proposes a pipeline be built from the oil sands to a refinery in Saint John, New Brunswick. This project would not only provide an Atlantic route for Alberta oil, but would also provide thousands of jobs at the refinery in Saint John as it would require a large upgrade. Yet, even in its earliest stages, it looks as if the project could face much opposition as Premiers of Saskatchewan, Manitoba, Ontario, and Quebec would have to be convinced if it is worthwhile for them politically to allow a pipeline to cross through their territory. For supporters of big oil in Alberta, the problem is not the ever growing demand of the global economy, but instead the politics of moving its product across the globe. However, Alward’s steadfast support sets his proposal apart from Keystone or Enbridge; perhaps it is time that Redford turn her back on the South and West and instead look East to friendlier partners.
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