Wednesday, June 24, 2015

Oil Sands Moratorium - Wrong Wrong & Wrong



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Moratorium on oilsands development NOW, why? Regardless of what scientists say, regardless of the risk to humanity, regardless of whether Canada produces oil or not; fossil fuels will be used for a long time to come. If Canada stopped oilsands production tomorrow, other producers will fill the gap in supply, producers of ill repute – Nigeria, Venezuela – and then there are the geo political realities with transferring production to producers who challenge us in the world, Iran, for example.  It is naïve in the extreme and grossly irresponsible to suggest Canada should forgo the economic benefit of the Oilsands in the first place and to forfeit the means by which to finance transition in the second.

We all realize that there is a need to begin the transition away from fossil fuels, we need to draw on our natural strength in fossil fuels, to in effect, turn the situation inside out. We can set the transition time frame, we can build industry realities to suite. That is to say, if industry is given a clear set of parameters to work with it can invest accordingly. When government, industry and interested parties understand time frames and costs, then there can be set in place the funding of transition by the wealth generated by the industry itself – industry informed can shape the transition.  Reducing Canadian production, reducing Oilsands, the largest potential contributor to Canadian oil production, only serves to both damage economic prospects and weaken the transition process.



The realities of the world economy dictate the realities of global warming, the challenge is the absence of fungibilty of energy source, as opposed to very marginal variances in carbon load per barrel of oil produced; the brain trust concerned about fossil fuel use would do better to direct attention to substitutes and or long term functional use of fossil fuels, than playing politics in a space that has no response to politics. The demand for energy, in large measure, is a fixed number of BTUs, Canadian Oilsand oil can provide them, China Coal can provide them, German Coal can provide them, producers of ill repute can provide them – they will be provided by fossil fuels until a viable substitute comes. The reality is, and this fact is substantiated by market realities – there is no viable substitute at present.

Any discussion around fossil fuels, climate change and Canada, needs to have as a back drop consideration of some important points, Canada is a responsible producer, Canada is a socially conscious producer, Canada due to its forest landscape is a massive carbon sink, Canada’s export of Natural Gas has resulted in a net carbon benefit vis a vis the reduction in world consumption of coal. Canada is a “petro” economy, enormous wealth accrues to Canadians from the fossil fuel industry –  rather than trying to stop the industry, perhaps we ought to consider more aggressive use of mitigation on the path to transition.

Document Calling for an Oilsands Moratorium - CLICK LINK BELOW


Response to 10 Reasons  

Reason 1. Continued expansion of oil sands and similar unconventional fuels in Canada and beyond is incompatible with limiting climate warming to a level that society can handle without widespread harm. The latest analyses agree that the warming predicted to occur this century will substantially raise the risk of severe ecological and economic damage, widespread social upheaval, and human suffering (IPCC 2013) and that oil sands expansion is inconsistent with avoiding this outcome (Chan et al. 2010, McCollum et al. 2014, McGlade and Ekins 2014). To address the risks of climate change, Canada has committed to significantly reduce greenhouse gas emissions by 2020 and 2030. Continued investment in oil sands production and infrastructure is not consistent with these targets and undermines broader efforts to reduce CO2 emissions and control climate warming (Office of the Auditor General of Canada 2012, Environment Canada 2014). ‡ We need a different energy path.

We need a different energy path, granted – we need to have a path, no one to date has offered a viable path. Punishing Canada, a responsible producer offers no solution and retards access to funding for transition, because in Canada we offer access to influence over industry – other jurisdictions fail to. What seems to be missing in the dialog on the issue, is that “the risks of climate change” are absent relevance in managing the problem, the societal inertia related to fossil fuel use is. The fossil fuel consumption system is at such a scale and complexity that it is beyond managing absent energy fungiblity at fossil fuel price parity. The entire transportation complex is an infrastructure of such mass it is nearly impossible to transition away from.

Reason 2. Oil sands should be one of the first fuel sources we avoid using as society moves to non-polluting forms of energy, not the next carbon-intensive source we exploit. We need reliable energy sources while we develop a new economy around cleaner fuels. Extracting, refining, transporting, and burning oil-sands energy produces among the most greenhouse gases of any transport fuel per unit energy delivered (Brandt 2011, Gordon et al. 2015). Expansion of oil sands production will exacerbate the problem of carbon pollution and slow the transition to cleaner energy (Unruh 2000).

It is the case that oilsands oil is more carbon intensive than other sources but, only by a small margin and now with insitu technologies the carbon load for Oilsands fuel is falling. What is certainly the case is that the overall environmental damage from oil production is greater by the producers of ill repute. Nigeria still flares natural gas off oil wells, like Canada did in the 1950s, Venezuela puts crude oil directly on road ways. Any oil production, coal production and to a lessor degree, gas production “exacerbates the problem of carbon pollution”, the focus needs to be on managing the use of fossil fuels until the solution to their safe use is found or  until a substitute is found.



Natural Gas Carbon Emissions Nearly Half Coal

The actual mining operations are only taking less than 1% of the area of Alberta, this is a tiny foot print relative to the economic benefit the oilsands generates. When one contemplates the foot print of the overall transportation complex, for example, the oilsands is dwarfed.

To call for a moratorium on the oilsands is unfair to Canada, when the preferential environmental performance of the Canadian oil industry relative all other producers is clear and the incremental increase in carbon for oilsands oil is small and shrinking.

Reason 3. Current oil sands environmental protections and baseline data are largely lacking, and protections that exist are too seldom enforced. In Canada, there are few controls and no uniform standards regarding pollution and other impacts from oil sands mining. Water quality monitoring by the Canadian government and industry was poor until recently, so there is little baseline knowledge to evaluate impacts on terrestrial and aquatic life (Environment Canada 2010, Royal Society of Canada 2010, Dillon et al. 2011, RAMP 2011, Jordaan 2012, Kirk et al. 2014). § In some cases, the enforcement of existing regulations (such as 2009 Bill 74 that would eliminate liquid tailings) is formally postponed (Energy Resources Conservation Board 2013). Actual rates of development on the ground exceed stated conservation targets (Komers and Stanojevic 2013, Government of Alberta 2012). ** Too often, the development of the oil sands is presented as inevitable, while protections for human health and the environment are treated as optional.

The primary jurisdiction in Canada for oilsands production is Alberta, so uniformity of regulation is less than relevant. You state Canadian water quality monitoring is poor, compared to where. The people living proximally to the oilsands development are in the main very healthy people. There are health challenges with the first nations peoples in the area, some attribute their health challenges to water; it is unclear to me whether health challenges are product of the ambient environmental reality or industrial activity; the solution is clear enough – improve living standards and bring drinking water and food sources up to standard. The oilsands economic contribution effects a degree of prosperity in the area that exceeds the national average; there are many in the first nations that are benefitting.  To say that “protections for human health and the environment are treated as optional” in Canada simply is unsupported by the facts, in Canada generally and in the area immediate to the oilsands.

Reason 4. Contaminants from oil sands development permeate the land, water and air of the Canadian boreal landscape, and many of these impacts are difficult to mitigate. Independent studies have demonstrated that mining and processing Albertan oil sands releases carcinogenic and toxic pollutants (e.g., heavy metals, polycyclic aromatic compounds) to the atmosphere from smoke stacks and evaporation, and to groundwater from leaching of tailings ponds. This pollution harms terrestrial and aquatic ecosystems and the species within them (Pollet and Bendell-Young 2000, Gurney et al. 2005, Nero et al. 2006, Gentes et al. 2007, Kelly et al. 2009, Kelly et al. 2010, Landis et al. 2012, Rooney et al. 2012, Kurek et al. 2013, Andrishak and Hicks 2011, Hebert et al. 2013, Galarneau et al. 2014, Parajulee and Wania 2014, Schindler 2014, Schwalb et al. 2015).

The Canadian boreal landscape is a sweeping description, assuming some carriage from the oilsands, perhaps 2% of the Alberta “landscape” would be exposed to air “contaminants”. Industry does come with downsides, we all realize, it is a question of degree in all cases. The area of operation is remote, industrial practices manage risk to workers effectively. The wildlife in the immediate area are sure to be affected, in managing bio diversity the question is “do we have a healthy representative population on which to secure the ongoing health of any given population” – clearly the answer here is yes. The area is generally capable of managing the impacts that emanate from oilsands production. Is there some room for improvement, there is, and there has been improvement.

Reason 5. Less than 0.2% of the area affected by Canadian oil sands mining has been reclaimed, and none restored to its original state (Government of Alberta 2014). The oil sands industry’s claim—widely seen in industry advertisements—that its mine sites can be restored to their former natural state is not true. Indeed, the claim is at odds with the industry’s own reclamation plans filed with the Alberta government (Rooney et al. 2012). Recently published studies find that intensive disturbances associated with oil sands mining change fundamental biological processes, making it impossible to fully restore the affected wetlands, peatlands, and boreal forest, now or in the future (Foote 2012, Johnson and Miyanishi 2008). Conversion of the boreal forest alongside other disturbances from oil sands development has led to the decline of federally threatened species such as bison and woodland caribou and important subsistence food species such as moose in addition to the ecosystem-wide effects addressed in Reason 4 (Gates et al. 1992, Dyer et al. 2001, McLoughlin et al. 2003, Sorensen et al. 2008, Morgan and Powell 2009, Boutin et al. 2012, Stewart and Komers 2012). The few attempts to reclaim mined lands have produced landscapes that bear little resemblance to what was there previously and contain only a fraction of the historical biological diversity (Rooney and Bayley 2011, Rooney et al. 2012, Kovalenko et al. 2013).

It is certainly true that the mine site can be reclaimed, it is also true that the site can be improved post mining, improved from the point of view of another human use, or improved from a wild life habitat perspective. It is often the case that people in the environment movement are in possession of an absolutism with respect to the functionality of nature, it is rare that anything in nature is optimum for anything, it is almost always the case humans can accentuate biological functionality. By way of example, spawning reds (the area where fish spawn) are never optimum, we know the exact water flow, size of aggregate ect. to make a the ideal red, we can make that happen every time – nature rarely if ever does. There are requirements for reclamation built into regulation, it is a matter of optimizing timing in the context of operations, it maybe that timing is missing at present or it may be that government needs to push companies along.

Reason 6. Development and transport of oil sands is inconsistent with the title and rights of many Aboriginal Peoples of North America. Rapid expansion of the oil sands in Canada violates or puts at risk nation-to-nation agreements with Aboriginal peoples. In Alberta, oil sands mining is contributing to the degradation and erosion of treaty and constitutionally protected rights by disrupting ecological landscapes critical to the survival of Aboriginal culture, activities, livelihoods, and lifeways (Passelac-Ross and Potes 2007, Foote 2012, ACFN). In the US, proposed infrastructure projects threaten to undermine Treaty agreements between the federal government and Native American tribes (Mufson 2012, Hart 2014). In both countries, contamination of sacred lands and waters, disruption of cultural sites, lack of consultation, and long-term effects of climate change undermine sustainable social, ecological, and economic initiatives involving Aboriginal peoples across the continent and constitute violations of Native sovereignty (Passelac-Ross and Potes 2007, Foote 2012, Mufson 2012, Hart 2014, Irvine et al. 2014, McLachlan 2014, Wohlberg 2014, Athabasca Chipewyan First Nation, Tsleil-Wautath Nation).

To state that “development and transport of oil sands is inconsistent with the title and rights of many aboriginal peoples “ is certainly a convenient argument, convenient as it is inaccurate (at least in Canadian Jurisdiction). It must be said, the manner in which legitimate first nations interests have been hijacked by the environment movement is appalling, appalling because the first nation people’s are paying for their allegiance to the environmental movement with ongoing reduced living standards.  The aboriginal peoples in the Fort McMurry area have openly stated their support for the project, they are benefiting from it. What is in conflict with first nation interests is the pain of low resources, the oil industry can and does help. In the area proximal to the oilsands there is no encroachment on First Nation treaty rights – to assert there is, is wrong. What is violating the rights of First Nations peoples is the absence of prosperity? From the perspective of prosperity your document’s assertions are violating First Nations right to prosperous and healthy lives.

Reason 7. What happens in North America will set a precedent for efforts to reduce carbon pollution and address climate warming elsewhere.
The choices we make about the oil sands will reverberate globally, as other countries decide whether or how to develop their own large unconventional oil deposits (Balouga 2012). Strong North American leadership is needed now, because the impacts of current decisions will be felt for decades and centuries.

The reduction of Canadian oil into the overall world oil supply will only serve to hasten the development of other heavy oil reserves elsewhere, and once again, transferring production to jurisdictions absent the regulatory constraints placed on Canadian oil producers. It is far better to keep oil production in a country where there can be input into operations by environmental interests and where government can be “managed” in a manner that directs a portion of oil royalties toward transition. This document generally and this point specifically, fails to recognize the presence of willing buyers and willing sellers – the demand is there, it will be supplied – other heavy oil reserve ownership could care a less whether we set a good example or not, they care whether the long term price of oil will support extraction. While the expertise and technology is in some cases transferable, the Canadian industry has an edge due to the dynamics of capital allocation and length of time under operation.  Canada is a stable jurisdiction, industry forged a favorable arrangement with government here that supported a very long term investment in plant and technology – the early stage support of the industry effectively “stranded capital” – those plants will produce at or near a loss position now because the is no means to transfer the value in the assets to another production modalities. Other jurisdictions in the present supply / demand picture are unlikely to attempt to enter the market with heavy oil reserves. If the authors of this document have their way, all of the North American production will be curtailed, a reality that will reduce supply and drive up price – perhaps to a point where heavy oil reserves elsewhere become viable for development.   

It is naive to believe that anything we do in North America will affect the use of oil in other jurisdictions, China is burning coal in a manner that is far below North America Standards, for example, nothing we have said or done has had China change it’s use of coal. What will reduce China's use of Coal is inexpensive LNG, a substitute fossil fuel the represents considerable benefit; LNG can be viewed as a viable “step” in the transition process.


Everyone in the environmental movement realizes that any solution that disadvantages one jurisdiction will fail, disadvantaging North American is the premise of this document – Kyoto failed for this very reason. 

Reason 8. Controlling carbon pollution will not derail the economy.
Most leading economists now agree that limits on carbon pollution – using mechanisms such as carbon taxes, cap-and-trade systems, or regulations – can facilitate a transition over several decades to low-emission energy without a dramatic reduction in global economic growth (Global Energy Assessment 2012, IPCC 2014, Nordhaus 2014).

The transition holds the requirement of a substitution, it is certain that over the course of several decades we can move away from fossil fuels even with our current solutions; the key of course is to access more dramatic solutions. You state “controlling carbon pollution will not derail the economy” which economy, real people, in real places will be derailed if not redirected. Canada’s economy is very reliant on fossil fuel, if Canada is not a petro state, it is a raw resource state with a massive petro component – Canada would incur hardship if transition was too aggressive. Curtailing pipeline expansion, curtailing oil production will hurt Canada’s economy, and to do it now is premature for reasons stated above. One only needs to look at history and map dramatic upswings in oil prices and the resulting recessions to know that constrained supply of oil slows the economy.

Carbon taxes have no real effect on fossil fuel consumption, they offer a means by which to extract funds from carbon consumption to facilitate transition. Cap & Trade Systems introduce offsetting industrial activity – X number of tons of carbon emitted X number of trees planted – Cap & Trade is the most viable means to manage future emissions.

 Reason 9. Debates about individual pipeline proposals underestimate the full social costs of the oil sands, and existing policies ignore cumulative impacts.
These are not simply business decisions. Responsible policies should address the interwoven, system-wide impacts of oil sands development, from mines and refineries, to pipelines, rail and tanker traffic, to impacts on economies and the global climate system. Current laws, regulations, and policies are not designed to assess cumulative impacts (Johnson and Miyanishi 2008, Office of the Auditor General of Canada 2011).†† When oil sands development is viewed as an integrated whole, the costs and benefits of individual decisions can be evaluated responsibly (Chan et al. 2014).

The challenge with assessing climate change and any given human action in relation to it, is that causation is difficult to assess, it is a challenge that is outside the perception of most of us living our lives. This reality is exacerbated by the rhetoric that is present on both sides of the debate. It is clear that we need to understand the affects of a given industry in a holistic way, and that externalities be measured and monitored. We see a global increase in temperature, we see that this will effect environmental changes – the complex of causal agents is obscured by the number and the causal agents’ global nature. The earth has been warmer than it is now in the past – they farmed in Greenland in around 1000, temperatures were at about that same point in 2006. This fact in no way negates the fact that fossil fuels represent the biggest anthropological influence on the environment and that measures need to be taken to transition away, what is unclear however, is the degree to which human action is changing climate. There is room for discussion, for interpretation of events, when you approach the “climate change community” on the subject, you’re labeled a “denier”. It is this degree of “religiosity” that confounds rational assessment at any level in the process of managing the challenge. The facts are rarely assessed rationally, but rather used to support one side or the other. The fervor by which oilsands are attacked is unfounded – in the context of the overall world industry – singling out the Canadian oilsands is unfair at the least, and irresponsible at worst. Please do a dependent origination analysis on Canadian oilsands oil, but do it also on all other sources of oil AND factor in social costs of oil production in other jurisdictions. When I’ve done that process to the best of my capacity, I’ve drawn the conclusion, that when the entire complex of outcomes is considered - net environmental affect, net social benefit, geo-political consequences – the Canadian oilsands are a good and responsible producer.

Reason 10. A majority of North Americans want their leaders to address climate change, and they are willing to pay more for energy to help make that happen.
Surveys of public opinion over the last two decades have found increasing public support for effective actions to prevent climate change. An overwhelming majority of North Americans now support government action to address climate change, even when these actions result in modest increases to energy costs (Bloomberg 2014; New York Times/Stanford University 2015).       

People will support things that have limited impact on their living standards. Most people are dependent on fossil fuels for their daily lives and they notice any fluctuation in fuel costs. This document, if it were adhered to, would have no affect on consumption patterns; so the majority of North Americans are unaffected, it is the people who have planned around the oilsands industry who are being attacked. Many of the people now living prosperous lives as a result of oilsands development came from depressed economic zones, and we have waning manufacturing in other parts of Canada with resulting unemployed who need occupation. If you can attack the oilsands and reduce production; the global picture on carbon emissions will remain unchanged.  
  
If the contents of this document were to be actuated and a moratorium on oilsands production and related infrastructure were to take place, it would  guarantee Canada looses absent any assurance that anyone else is in the game. A good many people have built their lives around the future of the oilsands, and resulting infrastructure; curtailing it will derail their economic future – it is irresponsible to advocate to the contrary. The fossil fuel “debate” or efforts to alter the way fuels are consumed has been heavily influenced by the countries who are net importers of fossil fuels, they derive economic benefit from alternate energy sources being brought into play, in Canada we incur economic hardship. A moratorium of the nature suggested hurts Canada and shifts production to producers of ill repute. If oilsands are curtailed and there is reduced production; the global picture on carbon emissions will remain unchanged. A moratorium is the wrong approach in the wrong place.  
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