Optimism and anger as Albertans react to pipelines



Industry in Alberta was quick to celebrate the federal government’s approval of the Trans Mountain and Line 3 pipelines on Tuesday, but opponents vow to delay or kill the projects by any means possible.

“I think that Canada’s reputation as a place that can move projects forward took a step forward today,” said Tim McMillan, the president and CEO of the Canadian Association of Petroleum Producers.

McMillan said this was a positive move toward reducing the price differential for Canadian oil. Producers face sometimes steep discounts on the price they receive for a barrel of oil in the U.S. compared with world prices.

With the ability to send more oil to Pacific markets, and increased capacity on a rebuilt Line 3 pipeline to the U.S., Canada’s oil and gas companies should be able to get a better price.

University of Calgary economist Trevor Tombe said that without new pipelines, the National Energy Board predicted a shortfall of $10 per barrel.

“That adds up to over $10 billion a year in forgone revenue for producers,” he said.


It’s hard not to cheer for an economic downturn

Photo by Dave Cournoyer

Photo by Dave Cournoyer

The prospect of a housing market collapse makes me giddy. Low oil prices? It warms my heart. Higher interest rates? Ooh, baby.

I would be willing to bet there are a lot of you reading that and nodding your head in agreement. Yes, you think, that could be great. It might even mean that one day I’ll be able to buy a house, or afford my rent.

If you don’t have crushing debt levels that would be affected by higher interest rates, you might have a point. I feel that way. I’m excited by the prospect of an economy in distress, and that’s problematic.

We have ended up in a situation, in this city more than any other jurisdiction in Canada, where too many are being suffocated by a system geared towards rewarding the already successful. It’s been said many times, and it bears repeating, that it is difficult to thrive in this town if you don’t have the “right” kind of job. That not only breeds resentment, it also sets things up so that people like me, and probably people like you, cheer for a downfall that will bring many down with it.

Not only are we suffering from a bigger wealth gap in this city and in this province than other areas of Canada (and of the U.S. as a whole), we are mercilessly tied to the type of oil and gas commodity swings that recently wiped out $7 billion from provincial coffers virtually overnight, or that bring incredible wealth to a few, while driving up costs for the many.

And so some of us cheer when we see bitumen drop from $100 per barrel to $40. We envision foreclosed houses in inner-city communities that we could actually get our hands on. But of course it’s nothing to be happy about.

We (and I use that term to mean those of us without bursting bank accounts) are just as desperately tied to the swings of the market and the price of oil as the next guy. Sure, the effects of a major disruption will hit those in the downtown towers harder and faster, and may even open up some opportunities, but if that market trauma lasts for too long, it brings almost everybody down with it.

Here we’ve gotten to the meat of the matter. We are hopelessly unable to untether ourselves from the almighty market and its total indifference to our lives and our circumstances. We have a provincial government that is unwilling to even consider how to alleviate the nauseating swings by bringing in corrections like a provincial sales tax, or a progressive income tax, or a living wage policy, or increased corporate taxes, or increased royalties, or real environmental regulations, or a carbon tax, or reliable money transfers to municipalities for things like affordable housing and increased transit.

We have a city council that can’t even pass basic measures to allow for more secondary suites in a city that is years into a housing crisis, not to mention some form of rent control to alleviate gouging by some landlords.

What we get instead of all of these things is a circling of the conservative wagons in Alberta in order to impose austerity measures that will undoubtedly wreak havoc on the lives of the poor while barely touching those in the higher wage brackets. Already the unions are fighting back the first wave of attacks and there are certain to be more. On a city level, we have at least one councillor who would rather fine distracted pedestrians than consider affordable housing measures (no, seriously, you can’t make this up).

It all points to a sick system, and profoundly blinded provincial and federal governments and civic politicians. It’s a system where my automatic reaction to a downturn is to cheer the negative consequences for others in the hopes that I can get a share of the pie, even if I might be hurt as well. It’s a system where those who win, continue to win, without looking after others who fall through the cracks. It’s a system where we destroy in order to accumulate without regard to the future or any semblance of dependability and consistency.

The only hope is that during the coming financial storm, our governments remember the mistakes of the past and the continuing social deficit left over from Ralph Klein’s destructive reign, and realize that in order to build a province, you can’t keep hacking at the legs of the majority of its citizens.

This post originally appeared in Fast Forward Weekly.

Citizens on the backburner: it’s all about the oil in Alberta


Imagine if you could run roughshod over the laws and be comfortable in the knowledge that you’d only get in trouble about one per cent of the time, and when you did, it amounted to a miniscule fine. What would you do?

You’d probably behave like the oil companies operating within Alberta.

In a recent report by Kevin Timoney and Peter Lee, and reported on by the Canadian Press, the authors sorted through thousands of government documents which they tirelessly compiled through Access to Information requests. What they compiled was a list of 9,262 environmental infractions — about 4,000 of which broke a facility’s licensing conditions — in the oilsands region since 1996. The government reaction to those 4,000 punishable incidents? They took enforcement action against 37.

According to the Canadian Press, the median fine was $4,500. For an oil company.

We’re not just talking about an employeee spilling a bit of solvent on the ground either. These incidents include leaks into the Athabasca river, the same body of water the Canadian Association of Petroleum Producers insists is only contaminated by natural occurrences of bitumen. Nothing to see here folks, carry on.

The majority of the violations concerned air quality, seven per cent concerned water. One in five was due to a failure to file mandatory reports for regulation and data collection.

That last point leads to the fact that the researchers were confronted with sloppy, incomplete data from government records. The government, which insists it is watching and protecting us, doesn’t have a damn clue what’s actually happening in our biggest and most destructive industry. How do you enforce something if you don’t know what’s happening?

It’s just the latest and most blatant example of a government that doesn’t care as long as it gets a cheque, and an industry that’s all-too-willing to twist and bend and break the rules in order to pursue ever-increasing profits. It’s not hard to imagine boardrooms full of laughter at what companies can get away with in this province, and the minimal costs they must pay to do so.

Another recent incident points to the lack of knowledge, lack of care and lack of permitted citizen oversite in oilsands operations. In this case, the underground leaking from Canadian Natural Resources Ltd. operations on the Cold Lake Air Weapons Range.

The leaks, which are confounding regulators as well as the company, are caused by underground steam injection which melts bitumen and allows it to travel to the surface through pipes. It has been touted as a greener alternative to open-pit oilsands mines, but it also involves more water and energy.

The current leak, which was reported on June 24, is the fourth such leak attributed to CNRL to occur in the area. This is the first to affect a body of water, however. According to an article in the Globe and Mail , Alberta’s Energy Regulator — the attempt to rebrand the old regulator, the Energy Resources Conservation Board — says the bitumen is flowing into a slough, seeping up from underground, not leaking from pipes. Nobody is quite sure how it’s happening, or how to stop it.

It took 25 days for the regulator to tell the company to stop steaming in the area. It also took the regulator almost a month to inform the public that it had forced the company to stop steaming in another nearby lease due to three similar spills in the spring. Conveniently, the company told theCalgary Herald that it was finished with steaming in the area for the year. Thanks heavens they didn’t lose any income.

It’s not hard to see how it all comes together. It’s the classic dilemma of a government that is beholden to one industry. Sure there’s lip service paid to economic diversification from time to time, but we all know what drives this economy and what dictates government (in)action. The evidence continues to mount of a government that doesn’t care about the environment, or getting a decent payout for citizens from the companies that rent our land.

Transparency is an empty catchphrase, accountability is non-existent and the profits, at least for the companies, continue to mount. All while the government invests our money in PR spin for the industry.

How does it feel to be a second-class citizen?

You are a slave owner: Andrew Nikiforuk on energy consumption


As the oilsands continue to expand — clearing forest, digging earth and pooling effluent — there’s more than just nature that is being shunted aside. According to journalist Andrew Nikiforuk, we’re also burying debates about what it all means in the process. And so, in his new book, The Energy of Slaves , he revives some old ideas that remain fresh and takes them to an exhaustively researched new starting point.

“If there’s any place in Canada where we should be having wide-open debates about energy — its character, its nature and its development — it should be here,” he says over coffee in Calgary. “And what happens when anybody raises even a question about the pace and scale of development in the tarsands? ‘Oh well you’re fucking Greenpeace, or you’re this or you’re that.’”

Peppering his conversation with expletives, it would be easy to paint Nikiforuk as an angry ideologue, but that’s simply not the case, in person or in print. His latest book takes us from the use of slaves in building society to the present-day use of energy slaves, slurping up oil and gas in order to give us a level of societal opulence never before seen. The arc is presented matter-of-factly and helps to illustrate the gooey bind we find ourselves in.

“We’re locked into high energy living, which is really high carbon spending too,” he says. “We have all these freakin’ slaves, we’ve become fat and lazy and extremely comfortable, and like the slave holders of old, we don’t even want to have a discussion about this.”

Nikiforuk blames this silence on the fact that Big Oil dominates the conversation, but he also acknowledges that the comforts afforded by oil and its mechanical slaves are a balm for people not wanting to address the inevitability of change. He calls the oil age “a hell of a joyride.”

From a historical arc, Nikiforuk takes us on a journey through our increasingly complex world, from the politics of the petro state (Alberta is textbook in this definition, save for the military spending), to the absurdities of economics, to Japan’s energy crisis and what it means for the rest of the industrialized world.

These are not new ideas, at least not all of them. There are astute observations about the dangers of mechanical slaves and the new capitalism that date back to the 19th century, but Nikiforuk has skilfully weaved these old ideas into the contemporary sphere in an attempt to create a concise metaphor for a larger discussion about where we need to go.

His logic is sharpest when he focuses on the rate of energy returns and the changes that have occurred in efficiency since the early days of oil. Our rates of return are diminishing and the high returns that led to our complex world of luxuries are gone.

“We can argue and rail against the tarsands in terms of carbon emission and pollution, but the thing that’s going to get us there are how poor those damn returns are,” he says.

“Big Oil can make a lot of money off that, but civilization can’t run on this shit for long. It is not providing the surplus. We haven’t had that conversation at all.”

Those waiting for the big sales pitch on renewables from Nikiforuk will have to hold their breath a while longer. Although he thinks that we need to invest heavily in cleaner forms of energy, he doesn’t see it as a panacea. He says that if we do renewables the same way we’ve done oil and gas, “we’re going to be really fucked.”

“They thought the transition would be glistening windmills and solar panels in their front yard, when in fact the transition begins with an economic dislocation and disruption,” he says. “The same way the industrial revolution began.

“Unfortunately I think going down the energy ladder might be a lot harder than it was climbing up the energy ladder.”

So, the book and the author aren’t the most optimistic, but it’s not all doom and gloom. Yes there will be shocks, but there is only one conclusion to be drawn, according to Nikiforuk: we have to use less energy and give up some of our slaves.

“That doesn’t mean that everything will be bad,” he says. “I mean, I think relocalizing food production, I think that’s a good thing; getting more people involved in agriculture and farming, that’s a good thing; reducing the complexity of having to deal with so many mechanical, digital, electrical slaves in your life, I think most people are going to welcome that and, in many ways, are looking for that, because they can no longer cope with the complexity of machines in their lives.”

Staunching the flow: As Alberta reviews its pipelines, critics cry foul

Illustration by Mariella Villalobos.

Illustration by Mariella Villalobos.

On Thursday, June 7, approximately 475,000 litres of oil started pouring into the Red Deer River from a ruptured pipeline owned by Plains Midstream Canada. By the next day, Premier Alison Redford was on scene, eager to show she cares.

Just over a month later, a coalition of 54 groups penned an open letter to the premier demanding more than a well-timed photo op. The groups wanted the Redford government to initiate an “immediate independent provincewide review of pipeline safety in Alberta, similar to the one which was recently conducted for the auditor general of Saskatchewan’s 2012 report.”

The letter was signed by a wide array of groups including the Alberta Surface Rights Group, the Alberta Union of Provincial Employees, Greenpeace Canada, the Confederacy of Treaty 6 and more. By July 20, the groups had gotten their wish. Sort of. Energy Minister Ken Hughes announced that the government would conduct a pipeline review, but the signatories are upset that they have been left out of the conversation while the government consults with players in the energy sector, and they have raised concerns about the review’s effectiveness and impartiality.

Specific concerns are that the provincial regulator, the Energy Resources Conservation Board, was put in charge of hiring a third party to conduct the review, the scope of the review is too narrow, and the month-and-a-half timeline for finishing the report is far too fast for any meaningful examination.

“There have been other reviews done, both nationally and provincially,” says Mike Hudema of Greenpeace. “Most recently by the province of Saskatchewan, and their review was done by their provincial auditor. It was a very expansive review and looked at most of the sort of wide-breadth of Saskatchewan’s pipeline infrastructure, and what came out of it was several different places that the Saskatchewan government was failing communities and their environment when it comes to pipeline safety, and then a lot of suggestions for improvement.”

Hudema doesn’t hold out much hope for the same kind of result emerging from Alberta’s review. “Unfortunately we have a lot of questions about the review process and that’s, again, one of the reasons why we wanted to meet with the premier,” he says.

To that end, the 54 groups have initiated a petition to try and force Redford and Hughes to meet with them. In just over a week the petition collected over 5,000 signatures, but the response from the government has been silence.

Don Bester, of the Alberta Surface Rights Group, which represents concerned landowners, doesn’t think that silence will be broken any time soon. “There’s a push,” he says, “but there isn’t much response.”


Albertans have reason to be concerned. Although most oil, gas and energy byproducts reach their destination safely, the ERCB’s latest figures still highlight the dangers.

In its 2010 Field Surveillance and Operations Branch provincial summary, the regulator says there were 687 incidents spread over Alberta’s more than 400,000 kilometres of pipeline in 2010, which resulted in 1,175 recorded “liquid releases.” In total, approximately 25 million litres of produced water (an oily byproduct of extraction) and three million litres of liquid hydrocarbons were released into the Alberta landscape.

The ERCB directed 30 pipeline operations to suspend activities in 2010. Of those shutdowns, 47.3 per cent were due to internal pipeline corrosion, followed by external corrosion at 11.2 per cent.

Of course, most Albertans don’t hear of these “incidents.” Many happen far away from urban centres and the watchful eye of media. But there were three high-profile spills this year that brought the problem to public attention and forced the government’s hand. Earlier this year, 230,000 litres of heavy crude spilled onto farmland northeast of Edmonton and 800,000 litres of oil gushed near the border between Alberta and the Northwest Territories. Including the spill in Red Deer, these three “liquid releases” alone have let loose 1.5 million litres of oil in 2012.

Bester thinks things can be done better. The farmer, whose group includes landowners affected by the most recent Red Deer spill, says technology must be improved, particularly when it comes to river crossings. “We have people that own land right there and they’re telling us that Plains Midstream knew that this pipe was exposed and floating in the river well before the break even happened,” he says. “It was reported to them and they did nothing.”

Bester wants the current practice of lowering pipelines into river beds and fixing them in place with gravel to be replaced with new technology, including horizontal drilling far below the river bed. “I mean, they can drill a horizontal well a mile-and-a-half, you can drill your pipelines just the same as you do highway crossings,” he says. “You don’t rip up number 2 every time you want to put a pipeline across Highway 2.”


Of course, the recent publicity around oil pipelines in Alberta has as much to do with pipelines that haven’t been built as it does with oil clogging up rivers and muskeg. TransCanada’s Keystone XL pipeline through the States and Enbridge’s Northern Gateway that will transport oilsands bitumen to the West Coast are both high-profile fights that have galvanized public opinion and focused attention on Alberta.

“The world’s watching us and we need to make sure that people know that the regulations, the standards and the processes in place are, first and foremost, meeting Albertans’ expectations, but now also national and international scrutiny,” says Mike Deising, a spokesperson for Alberta Energy. “So we want our regulator to take a look at it and we also want them to bring in an independent third party. It just makes sense.”

MLA Laurie Blakeman, who, among several other portfolios acts as the energy critic for the Alberta Liberals, agrees that pipelines are inevitable. “I’m going forward with, if it’s going to happen, how do we make it the least damaging,” she says. “How do we take steps to make sure that if something goes wrong, it’s the least amount of something going wrong; there’s the most protection for the environment and the people that are around it. That’s my point of view.”

Her other point of view is that the government isn’t fulfilling its role when it refuses to listen to all sides of a story. In this case, the 54 groups representing a broad swath of dissenting Alberta voices.

“We all live here, we all breathe this air, we all have children that we want to be able to drink the water. So, having the government divide and conquer is not helpful,” says Blakeman from her office in Edmonton.

“There’s a lot of smart people in Alberta and some of them work in these organizations. And to completely go, ‘No, I’m not going to talk to a whole bunch of smart people that have things to tell me that would be helpful’ is kind of stupid, I think.”

Nobody thinks that the government should be ignoring the oil and gas industry, at this time or any other, but it’s a familiar complaint in the province that the government’s ear is a little too attuned to the messages put out by the royalty-gushing industry.

“I do think that the public deserves some degree of input,” says Hudema. “There’s definitely, when we’re talking about pipeline spills, the environmental impacts are a huge issue…. Also, when you look at the members of the 54 groups, a lot of them are landowner groups and landowner associations, so they have first-hand experience with what a spill means to a local farmer or a local rancher, what it’s done to their property, what some of their concerns are. I think the government should hear some of those voices.”

It doesn’t appear, however, that the government will be discussing pipelines with any of these groups any time soon. The premier’s office directed all questions to Hughes’ office, and Deising says it’s now out of their hands. “With respect to the review, now it’s in the hands of the regulator and the independent party to look at the three aspects that the minister wanted to see completed as part of the review. Taking that aside, because really we’re talking about the technical expertise of water crossings, spill response and pipeline integrity, that is a specific technical expertise that is required to look at those things…. With respect to broader stakeholder discussions, we’re open to always hearing from Albertans and their perspectives.”


The signatories of the open letter to Redford aren’t happy about the ERCB playing a role in any pipeline review, insisting that it’s too close to the industry that it oversees. The process for the review allows the regulator to not only choose the third party that will review pipelines in Alberta, but also to review that third-party report and submit its own report to the energy minister with any recommendations it thinks are necessary.

According to Hudema, “they are part of Alberta’s pipeline problem and really shouldn’t be reviewing themselves.”

On September 10, the ERCB announced that it selected Group 10 Engineering of Calgary to conduct the review, citing their technical competency. In total four organizations were vying for the job, but the ERCB won’t comment on who else was in the running.

Group 10’s engineering managers, Theo Abels and Daryl Foley, both have years of experience working in the oilpatch, from regulatory compliance to technical inspections. Of course, hiring an organization with so much experience is a double-edged sword, bringing expertise on one hand, and cries of bias on the other.

According to Hudema, it’s another indication that the government isn’t serious about the review. “I think what most Albertans were expecting was a very balanced review process that would not just look at things from an industry perspective, but really from an independent perspective, and would hopefully include some of those other voices in the process,” he says.

The ERCB, by necessity a thick skinned organization, isn’t fazed.

“Someone’s going to be upset with this, no matter what we do, usually, when we make a decision, so this is no different from any other time we make a decision,” says Bob Curran, an ERCB spokesperson. “We make thousands of those every year. For us, it’s business as usual.”

Of course, business as usual is what many of the critics are, well, criticizing. They view the government, the regulator and the industry with suspicion — a closed loop bent on extracting and shipping oil and gas despite the consequences. For Bester, this review is merely window dressing and he’s not surprised. “They do not want to know. Put it that way. As long as the royalty dollars can keep flowing, they have no concerns, everything is just swept under the table.”

This post originally appeared in Fast Forward Weekly.

Oil and government


When Gil McGowan, president of the Alberta Federation of Labour (AFL), walked into a conference room in Kananaskis to observe the meeting of energy ministers from across Canada in July, he expected to find a seat in the section reserved for environmental groups, or concerned citizens groups. There was no such section. Looking around the room, bedecked in energy company sponsorship banners, McGowan realized he was the only person there who wasn’t with an oil and gas company.

He shouldn’t have been surprised. After all, when he called then energy minister Ron Liepert’s office to get a seat at the meeting, which was open to interested stakeholders, he was rebuffed.

“So I’m the president of the federation of labour, (but) the only way I got in, even as an observer, was to phone my counterpart in Newfoundland who has a good relationship with their government, which happens to be a Conservative government,” says McGowan. “And so she talked to their energy minister. So I was invited by the Newfoundland energy minister to attend the conference here in Alberta.

“To make matters even worse, when Liepert got up to give his introduction, he said ‘I’m so pleased that we’re together here with all the relevant stakeholders.’”

It’s a surreal representation of what many say is an undue influence on the government of Alberta by the energy industry. Although the government does engage stakeholders, from labour to environmental organizations and beyond, many say that the energy industry has the greater pull. Critics point to the government ignoring the findings of multi-stakeholder discussions, the sheer imbalance between the well-funded oil and gas machine and those of civil society groups, and the amount of interaction between the government and the energy industry compared to other stakeholders as a sign that the cards are stacked.

CAPP and the Act

The AFL represents 29 unions with a combined membership of 145,000 people, some of whom work in the energy industry. This isn’t an environmental organization calling for a halt to all oil and gas exploration in the province, but it is concerned about the environment and “the responsible and sustainable development of our resources,” according to McGowan.

AFL is also concerned about the influence that the industry has over government policy making. While the Canadian Association of Petroleum Producers (CAPP) lists 81 different issues they will talk to the government about in the next six months, the AFL meets with the government only a handful of times each year. And so, they filed a freedom of information request looking at the interaction between CAPP and the government of Alberta.

The documents they received showed that the government and CAPP wanted to collaborate on a joint public relations campaign around shale gas fracking and water use. The federation believes that these documents demonstrate a breach of Alberta’s lobbyist act, which sets out stringent rules for engaging the government. For one, the people working on CAPP’s behalf were not among the 41 lobbyists registered by the organization.

So, the AFL sent the documents to the lobbyist registrar and asked for an investigation. What they didn’t do was check their package of documents carefully, highlighting only the unlisted lobbyists and the fact that a briefing note seemed to indicate that it was CAPP that approached the government about the public relations campaign. It’s an important distinction. If the government approached CAPP, the act would not apply. That’s exactly what the registrar ruled on November 28.

“We sort of assumed that he would do a thorough investigation, including a search of the documents,” says McGowan. “It turns out he didn’t do that. He only interviewed a couple of people and concluded that everything was hunky-dory because they said it was hunky-dory.”

After looking more carefully at the package of documents, the AFL realized they had emails that appeared to contradict the ruling. An email dated June 8, 2011 from Doug Bowes, the director of unconventional gas in the energy department, says that CAPP approached the government to discuss its desire to “strike a committee to develop a public relations strategy focused on fracturing and water use associated with shale gas development.”

The federation has called for a new investigation, but it’s unclear if that will happen. The act forbids the registrar from commenting on the matter, even to acknowledge whether an investigation is underway.

Travis Davies, a spokesperson for CAPP, doesn’t see any need for further investigation. He also doesn’t care much for the federation’s views. “I think the AFL’s characterization of the matter is really, one, inaccurate and pretty disingenuous,” he says.

“I think it goes back to, the AFL was upset that the commissioner did find that we were in compliance, produced these documents, which I would assume were part of the body of work that the commissioner looked at. I can’t of course speak for him. If you look at the findings, clearly it falls within the parameters.”

But for McGowan, it isn’t necessarily about registered lobbyists and who approached who. “This is about a broader concern about the proper relationship between government and industry. We feel very strongly that there needs to be a line between government and industry, even industries that are very important to the provincial economy.

“We’re afraid that that line has not always been observed. This is one of those examples where we feel the line has clearly been crossed.”

Meanwhile in the ivory tower

In a recent paper published in the Canadian Journal of Political Science , George Hoberg and Jeffrey Phillips make a similar argument. Their analysis of the Alberta government’s engagement with stakeholders in the oilsands concludes that despite an opening up of the conversation, it’s still mostly a back-and-forth between the two dominant players — the energy industry and government — when it comes to policy decisions.

The paper looks at several events, including the Radke report. Released in 2007, the report’s mandate was to look at the challenges of rapid expansion in the oilsands and to provide a short-term action plan. The first and most prominent recommendation is investing in infrastructure to support continued growth. Environmental recommendations are sparse and vague.

Another area of concern for the authors is the Cumulative Environmental Management Association (CEMA), a standing body that produces research into the cumulative effects of the oilsands region and makes recommendations to government. Hoberg and Phillips argue that it is ineffectual.

In one major example, the Sustainable Ecosystems Working Group within CEMA called for a partial moratorium on new oilsands leases until it could complete its work. The group was worried about the effects of rapid expansion. The government refused. When the group did produce its report, it called for 20 to 40 per cent of the region to be protected and for intensive developments to be carried out in only five to 14 per cent of the area.

The report did not receive consensus among CEMA members, which includes oilsands companies, and the government didn’t implement it. Instead, the government started its new Land Use Framework deliberations. This led to the Pembina Institute and two other environmental groups walking away from CEMA.

Hoberg, a professor at the University of British Columbia who specializes in environmental politics, says by phone that Alberta is “an example of a jurisdiction that is heavily dependent on one particular industry, and in circumstances like that, it’s not uncommon to have an extremely close power relationship between that industry and the government.”

That relationship is almost inevitable, given oil and gas’s heft in our economy. And it’s something the government feels is appropriate. “Across government, ministries work with stakeholders. It’s not only not uncommon, it’s necessary. The oil and gas industry drives this economy, it’s responsible for one in seven jobs in this province and it would seem absurd to not meet with the organization that represents that industry,” says Bart Johnson, a spokesperson for Alberta Energy. “We share common interests. They certainly have some interests in policy development with the government.”

Hoberg’s paper examines the introduction of multi-stakeholder discussions meant to address the rising tide of criticism of Alberta’s oilsands and to stem the perception that the energy industry dominates the conversation. While those processes allow for more voices to be heard, the authors looked at the policy outcomes of those deliberations and recommendations and found that industry tends to get its way.

“The history of multi-stakeholder discussions on oilsands in Alberta is one of talk and drill,” says Hoberg.

Talking points

It’s a sentiment that many environmental organizations agree with. While many have participated in multi-stakeholder processes, there are also many who have pulled away. The reasons extend from the mundane concerns of operating budgets and the drain on resources that comes with participation, to the composition of the groups, to anger at the end product.

“Whether it’s citizens or industry or public interest organizations, all of them ask prior to joining whether this is the best use of our time, and is it better to be at the table, or not at the table?” says Joe Obad, associate director of Water Matters. “And those are tough decisions to make.”

When Water Matters was called Bow Riverkeeper, the organization was involved in the Alberta Water Council, a multi-stakeholder process designed to address concerns over industry’s affect on watersheds and wetlands in the province. It pulled out of the process.

“We felt it restricted our ability to speak out, so we left the Alberta Water Council because we felt we’re going to speak out about this and we’re going to speak very clearly and not use the process as the means to speak about the things we support,” says Obad.

“That was a difficult decision to make, but it was based on the idea that every group should be allowed to champion its objectives by whatever means it sees fit.”

The Alberta Water Council is a process that comes up again and again when speaking to environmental groups about the concerns they have over industry influence. Chief among their complaints is the decision by the government to scrap a no-net-loss wetlands policy that would force industry to protect watersheds, or to replace ones that they destroy.

After three years of discussion and study, of the 25 organizations represented on the council, 23 supported the measure and, according to the Pembina Institute, 90 per cent of Albertans who were polled supported the idea. The only two non-consensus votes were CAPP and the Alberta Chamber of Resources (ACR), which sent dissenting letters to the government.

ACR boasted on its website at the end of 2008 that it had effectively lobbied the government not to follow through on the recommendation.

In an abridged version of a speech posted on the site, given by the executive director of ACR, Brad Anderson, he says: “One of the most influential things ACR was able to accomplish in 2008 was to do a really good job explaining where industry’s line in the sand is when it comes to critical issues. A prime example of this was the position the Chamber took on the proposed Provincial Wetlands Policy.”

It says that it successfully lobbied the government to accept three of the four changes it requested in its dissenting letter, including scrapping no-net-loss. This was posted on the ACR website before the government made its announcement.

When the Canadian Press reported on the claim and the anger of those who participated in the Water Council discussions, the report was removed from ACR’s website. A copy of the website post was saved and given to Fast Forward Weekly .

Mike Hudema, a tarsands campaigner with Greenpeace, says the organization has not participated in any multi-stakeholder processes since setting up shop in the province in 2007. “The story that we heard was the same, that it was a lot of time and resources spent and at the end of the day what came out was not reflective of the conversation that many of the groups had,” he says.


Of course, no conversation about oil and gas in Alberta can ignore the regulations set in place to protect our environment and ensure that companies are following the rules. There seems to be no middle ground when people discuss the Energy Resources and Conservation Board (ERCB), the arm’s-length government body responsible for approving or denying oil and gas projects. It’s either a pawn of the industry, or a world-class regulator, or an overbearing obstacle. You either love it, or you hate it.

For many critics, you simply have to look at the overwhelming number of approved applications and the relatively few denials: in 2011, the ERCB approved 79 applications while denying seven.

“It’s an overly simplistic view,” says Darin Barter, a spokesperson for the ERCB. “What you’re not seeing is the requirements that companies are bound to prior to even applying to the ERCB.”

Barter argues that companies have jumped through so many regulatory hoops by the time they go before the ERCB that approval is virtually guaranteed. “Companies can take months to years to put together an application for a project,” he says.

“The transparent part is seeing the approvals or denials, the less transparent part is seeing the regulatory framework.”

And there’s no doubt that the regulatory framework is intimidating. To the layman, it’s a Byzantine and dense set of rules that requires an in-depth knowledge to navigate, But critics maintain that it doesn’t go far enough. The wetlands policy debacle is one instance.

In the case of the oilsands, where no project has been denied, Pembina points to an agreement by Royal Dutch Shell to reduce its emissions to the tune of 900,000 tonnes in order to gain approval of its Jackpine Mine and Muskeg River Mine Expansion projects. The promise convinced Pembina to remove its objection to the project. Shell then reneged on that promise.

In a 2009 release, Pembina’s Simon Dyer wrote: “In approving Shell’s projects, the joint review panel struck by the Alberta Energy Resources Conservation Board (ERCB) and the Government of Canada explicitly noted that they would review Shell’s approval in the event that the company failed to fulfil commitments that had been presented as evidence.”

Pembina and EcoJustice petitioned for a review. That review did not happen.

The future

In Hoberg’s paper, the hopeful component of his less-than-rosy conclusion is that by opening the door to groups outside the traditional power structure, the government has given them credibility and will have to take their concerns seriously.

“And I do think the government and the industry, it took them a while, but now they have to acknowledge the significance of the environmental impacts of the oilsands and of environmental interest groups,” says Hoberg.

In the conclusion to his paper, he argues that it’s the government that must now save face. “In the oilsands case, the government of Alberta has formally acknowledged the legitimacy of environmental critics by giving them a formal voice in the consultation processes,” he writes. “Now that environmentalists have denounced those processes and withdrawn, the government’s own strategy has lost its legitimacy.”

No one interviewed for this article tried to argue that the government did not address a broad range of stakeholders. “I would say, in general, governments try to meet with all stakeholders,” says Obad. “They don’t tend to leave anyone out altogether. But it does seem that there’s a degree of difference in terms of frequency and accessibility.”?With vast financial resources, teams of lobbyists, ready access to decision-makers and a proven track record of being able to influence policy decisions despite being in a minority on stakeholder decisions, the oil industry has proven it has pull. On the opposite side, many groups are skeptical of engaging in discussions that seem to accomplish little more than depleting their sparse resources.

“The government has a responsibility to look after the public interest first and in cases where the public interest conflicts with the narrow interests of the energy industry, then the government has to fall on the side of the public interest, but I’m not sure that happens enough in Alberta, or even at all,” says McGowan.

“I’m certainly not suggesting that the labour movement or any other groups in civil society should be calling all the shots for government; what I am suggesting is that neither should industry.”

This post originally appeared in Fast Forward Weekly.

Ethical oil and China

Operation Iraqi Freedom is the multi-national coalition effort to liberate the Iraqi people, eliminate Iraq’s weapons of mass destruction, and end the regime of Saddam Hussein.

A great deal of attention has been paid to two pipeline projects — one that will see Alberta’s oilsands bitumen transported across the U.S. to the Gulf of Mexico (Keystone XL), and one that will run it through the Great Bear Rainforest in B.C. for shipment to Asia (Northern Gateway).

The projects have serious implications, ranging from potential environmental devastation due to a spill, to our further dependence on a resource that is long past its gone-stale date.

But there is another implication, specifically tied to the Northern Gateway pipeline and the inevitability of increased investment from state-controlled Chinese companies. At what point does investment from an autocratic regime undermine Canadian claims to ethical oil, if such a thing ever really existed in the first place?

Journalist David Ebner, in an article in this month’s Alberta Views magazine, asks an important question: how much foreign investment, specifically from state-controlled Chinese enterprises, is too much for Canada? What if PetroChina buys Syncrude?

The argument for Canada’s oil somehow being more ethical than other producers in the Middle East, Africa and Latin America, was first posited by conservative muckraker Ezra Levant. It should come as no surprise that his book Ethical Oil: The Case for Canada’s Oilsands has essentially become a guidebook for pro-oilsands rhetoric and the Conservative government of Canada. Alykhan Velshi, a former director of communications for immigration minister Jason Kenney, started ethicaloil.org in order to spread the ideas first developed in Levant’s book.

There are flaws in the rhetoric, especially around the environmental implications of the oilsands and whether a product that is harmful to the environment can ever truly be ethical, no matter if one jurisdiction takes more care than another. But what is ignored is whether increased investment from state-controlled business from China undermines, or will undermine, the claim that to buy from Canada is better than, say, Saudi Arabia.

Now, China isn’t sweeping through the oilsands region, hungrily consuming companies and laying the groundwork for a takeover of the reserves. Even if the Chinese government had an interest in doing that, the Canadian government would step in and regulate the transactions. China will never own the oilsands. But it is steadily increasing investments.

Over the last few years, Chinese companies have invested approximately $10 billion in the oilsands. Considering the billions of dollars of investment, capital and profits flowing from northern Alberta, that’s not a terribly high number. But that number, by all accounts, is going to go up.

Ron Liepert, Alberta’s energy minister, Prime Minster Stephen Harper and Alberta’s man-of-many-hats Lloyd Snelgrove (president of the treasury board, minister responsible for corporate human resources and minister of finance and enterprise), have all indicated that increased investment in the oilsands by China is not only positive, but inevitable. Recent talks between government officials and business leaders from China and Canada suggested that Chinese investment in the oilsands could triple in the coming years, though without the Northern Gateway, that investment prediction could fall.

On ethicaloil.org , the website seeks to put distance between bad oil (mostly Saudi Arabia) and good oil (mostly Canada). When the group paid for TV ads condemning Saudi Arabia’s terrible human rights record, the kingdom threatened to sue media outlets if they ran it. In response, Velsi said: “They’re just not used to being criticized. So they immediately reverted to thuggish censorship tactics.”

That’s an interesting choice of words: Thuggish censorship tactics. It’s a phrase that applies just as well to the autocratic Chinese government, which stifles dissent on a regular and chilling basis. There is a long list of infractions that are even worse: the wholesale destruction of Tibetan culture, the suffocation of the Uyghur people or the Tiananman Square massacre, to name a few.

But if the connection between Chinese investment and claims of ethical oil are a little too abstract for you, then perhaps you should consider this: In order to ship bitumen through those shiny new pipelines, the heavy oil from Alberta must be diluted. Often, that means blending it with light oil. That light oil comes from some pretty unseemly places, including Saudi Arabia. We are literally blending the so-called evil oil with the ethical stuff.

So, what happens when good oil meets bad? And what happens when peace, order and good governance gets in bed with a tyrant? Who knows, but it doesn’t sound very ethical, does it?

This post originally appeared in Fast Forward Weekly.