Tag: Alberta Oilsands

Straight Outta Edmonton: A New, Robust Role for Alberta in Federalism

Alberta has long played a pivotal role in Canadian federalism, with its economic might and vast oil reserves. However, the province’s equalization contributions have never quite matched its ability to influence the national agenda. This is partly due to Alberta’s size, but also reflects the province’s subdued role on the national scene.

For decades, the province engaged in an isolationist, defensive stance, strongly fending off any federal encroachment into its perceived sphere of control. This approach was consistent with both Liberal and Conservative governments in Ottawa, representing deep-seated resentment of Alberta’s expendable nature in a system where elections are largely determined by vote rich central Canada.

However, the nature of the challenges confronting Alberta today raises doubts as to the viability of this approach, particularly with increasing concerns over the province’s energy industry. Isolationism will not help the province overcome barriers to developing new means of transporting oilsands product to market, slashing the hefty discount purchasers are currently receiving. Neither will it address the major labour shortages facing Alberta, which involves making it easier for the province to lure workers from across the country and around the world. Rather, these challenges require Alberta to take a more robust role in federalism to shape the national agenda and ensure our interests are advanced.

Alberta’s role in confederation is a central issue at stake this election, with Allison Redford and Danielle Smith pitting two starkly different visions against each other. Visions both women outlined in speeches at the Economic Club of Canada a few months apart.

To Danielle Smith (speech), the solution is sticking to our isolationism and relying on a friendly federal government to make Alberta’s case to the rest of the country. Smith recognizes that this will make it difficult to expand our US oilsands market or develop new ones in Asia, but believes that an “all-Canadian solution” is the answer. By retrofitting current infrastructure, oil should flow west-east, eliminating the eastern Canada’s reliance on foreign oil and allowing depressed manufacturing regions of Ontario and Quebec to benefit from refining. A form of economic nationalism that one would expect to be proposed by Gordon Laxer, the Alberta Federation of Labour or the Alberta New Democrats than the Wild Rose.

How exactly she plans on accomplishing this without significant inter-provincial coordination is puzzling. However, the more important question is how this benefits Alberta. Refining oilsands product in Canada will increase the discount it’s sold at currently, meaning we will sell less oil and make less on each barrel sold.

Alison Redford (speech) on the other hand is calling for a break from the past, arguing that Alberta should take on a more robust role in Canadian federalism. At the core of this new role is her push for a Canadian Energy Strategy that will coordinate and advance provincial energy interests as a whole. In effect, the attempt is to link the oilsands to the energy interests of other provinces, in order to change national attitudes towards the industry. Although this sounds promising, the strategy lacks any real specifics to gauge what tradeoffs Alberta will be making in order to convince other provinces to get on board.

Regardless of what the election’s outcome, there are questions related to Alberta’s approach to federalism and its ability to address the challenges confronting the province. While the Wild Rose may have intentions of returning the province to the days of Manning, Lougheed and Klein, they and Albertans should be aware that the issues they dealt with are quite different from those that are confronting us today.

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Straight Outta Edmonton: The Market is the Solution

The Canadian Oil Sands Innovation Alliance (COSIA) is about collaboration. In a bid to meet public expectations and improve the industry’s image, 12 of the largest oilsands producers are teaming up, sharing information and intellectual property relating to environmental stewardship. By harnessing their collective strengths, they hope to improve the

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Straight Outta Edmonton: The Market is the Solution

The Canadian Oil Sands Innovation Alliance (COSIA) is about collaboration. In a bid to meet public expectations and improve the industry’s image, 12 of the largest oilsands producers are teaming up, sharing information and intellectual property relating to environmental stewardship. By harnessing their collective strengths, they hope to improve the

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Straight Outta Edmonton: The Market is the Solution

The Canadian Oil Sands Innovation Alliance (COSIA) is about collaboration. In a bid to meet public expectations and improve the industry’s image, 12 of the largest oilsands producers are teaming up, sharing information and intellectual property relating to environmental stewardship. By harnessing their collective strengths, they hope to improve the industry’s environmental performance and image.

Though well intentioned, collaboration is not the best way to improve environmental performance. The market is.

It’s easy to acknowledge the power of the market, and market competition specifically, in influencing firm behavior. If there is market incentive for a firm to behave in a certain manner, firms will do so, as their primary interest is profit maximization. Firms would also divert resources to behave in that certain manner in order to maximize that market incentive and gain competitive advantage, such as investing more in research and development.

Market incentives would drive behavior, leading to competition, which would lead to better ways to engage in that behavior.

This logic could apply to the oilsands. If there was strong market incentive for producers to engage in better environmental performance, they would compete with each other, developing better methods to outperform their market competitors. Invariably, producers would divert more resources into research and innovation, developing better methods of reducing their environmental impact individually, and the industry’s as a whole.

Currently, there is no such incentive.

In fact, by collaborating, industry confirms that there isn’t strong market incentive for them to develop better environmental practices individually. Rather than use their own resources to develop better environmental practices, companies are looking to work together, each benefiting from the other’s work. Though they recognize a problem, it isn’t impacting their bottom line enough to come up with solutions themselves.

Collaboration is hardly an environment for innovation. It runs the risk of firms taking environmental practices from others, instead of developing their own. There is even incentive to do this, as taking is free while developing one’s own practices requires resources that could be allocated elsewhere.

Creating strong market incentives for companies to improve their environmental stewardship will lead to better environmental performance.

One possible incentive might be linking resource royalties to environmental performance. For example, if companies hit certain government directed environmental benchmarks (emissions, pollutants, area of wet tailings, etc) they pay less. If they exceed them, they pay more.

As oilsands producers are generally price takers, this is perhaps the best way to introduce competition among them, and direct it towards addressing environmental issues and the industry’s negative perception.

Obviously though, this would require governments to get involved. Fortunately, both levels of government have long endorsed, and defended, a market dictated approach to oilsands development.

Why not the same for environmental stewardship?

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Straight Outta Edmonton: Harper’s Attack, Redford’s Consensus: Building National Support for the Oilsands

The Alberta Oilsands are a source of intense debate and discord both domestically and internationally. However, the future prosperity of the nation is inherently linked to Canada’s ability to take advantage of the resource and harness its potential. The challenge for proponents therefore becomes to cultivate broad based support, particularly domestically, as the resource’s land locked status and increasing role in the growth of national carbon emissions fosters political opposition that may well stifle development.

With Prime Minister Stephen Harper and Alberta Premier Alison Redford, we see two starkly different strategies employed to build support for the oilsands nationally.

In recent weeks, Prime Minister Harper, as well as Natural Resources Minister Joe Oliver, have adopted the meme first introduced by Ethical Oil and its acolytes, painting all opponents to the Northern Gateway Pipeline — which seeks to ship oilsands bitumen from Alberta to Asia via Kitimat, B.C — as foreign proxies sabotaging Canada’s economic interests. Unabashedly disingenuous as it attempts to other First Nations and non-First Nations communities along the proposed route that oppose the pipeline, as well as the numerous Canadian ENGOs whose history of advancing environmental causes in this country dates back well before the oilsands became an economic imperative.

The goal here is to impose the oilsands on the country by masking it in the language of “Canadian” versus “Foreign” interests, McCarthyizing acceptance. Far from winning over critics, the approach is likely to further polarize Canadians on the issue.

In contrast to bullying opponents, Premier Redford has quietly been working to build consensus on the oilsands, winning over provinces that her predecessors may at one time have labeled as detractors through her push for a national energy strategy. First championed at the Intergovernmental Energy and Mines Ministers Conference in Kananaskis last July, Redford has won support from western allies such Saskatchewan and British Columbia, as well as traditional critics such as Quebec, where support for the oilsands are at the lowest levels in the country.

Redford’s message to her counterparts is for them to collectively harness their province’s unique energy strengths, transforming Canada into both an energy and environmental super power. This level of collaboration will invariably require trade offs, which although currently undefined, may require Alberta to address the oilsand’s poor environmental performance sooner than anticipated.

Yet to Redford, this is likely a welcomed risk. Committing the provinces to a national energy strategy where the oilsands play a pivotal role, strengthens the resource’s economic viability at home and abroad.

Canadian history is rife with examples of the federal government unilaterally proceeding on divisive matters of national concern in a belligerent manner with little regard to opponents. Trust erodes, federalism is undermined, and matters that require consensus to proceed and sustain in the long term become polarized to the extreme.

National projects in the national interest — as the oilsands should be viewed — require consensus building, bringing critics on board through compromise, whether they are provincial counterparts, First Nations, or ENGOs. In this case, its requires the oilsands to transform from being the Alberta Oilsands to the Canadian Oilsands, with opponents buying in at various stages of development. The subsequent policy erosion will be offset with a strong, broad base of support, which will reap far greater rewards for the resource than proceeding along its current trajectory.

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Straight Outta Edmonton: Overhauling RAMP

For 13 years, the Alberta Government has relied on the Regional Aquatics Monitoring Program (RAMP) to assess the impact of the oilsands. From resource development to environment, RAMP plays a significant role in developing provincial policy.

2004 RAMP Peer Review:

  • “Reviewers reported serious problems related to scientific leadership and a lack of integration and consistency across components with respect to approach, design, implementation, and analysis.”
  • “lack of details of methods, failure to describe rationales for program changes, examples of inappropriate statistical analysis, and unsupported conclusions.”
  • “No ability within RAMP to assess oil sands development impacts on the Athabasca River in an integrated way.”

2010 RAMP Peer Review:

  • “The reviewers believe the existing program does not successfully address the three key questions posed in (the review goal) section: the present program is not sufficient to detect changes if they occur; the present program cannot sufficiently identify potential sources resulting in the change(s) if changes are detected; and not all of the appropriate questions are being asked by the RAMP program and appropriate criteria being monitored to answer those questions.”

Although many have questioned RAMP’s scientific validity, generally along the same lines as the program’s two external peer reviews linked above, the Alberta Government did not act on these criticisms until two academic studies published by Dr. Erin Kelly and Dr. David Schindler. The studies, published in 2009 and 2010, documented high levels of oilsands industrial pollutants, including PACs (carcinogens) and heavy metals, being discharged into the Athabasca River Basin.

The studies contradicted RAMP, which claimed industrial pollutants were negligible and environmental toxins were naturally occurring, and as a result, federal and provincial panels were struck to investigate the contradictions. The federal panel examined the scientific validity of RAMP and reported in late December that the criticisms leveled against it were accurate — the program was utterly incompetent and was unable to adequately assess the environmental impact of the oilsands.

Before the provincial panel reported its results (scheduled for release February), Alberta Environment Minister Rob Renner announced that RAMP would be overhauled to ensure that the province would have a competent, science based oilsands environmental monitoring program. However, the oversight committee charged with creating the new program came under attack, as critics slammed the appointment of more industry representatives than scientists, the lack of aboriginal inclusion, and the selection of Hal Kvisle as co-chair (many question Kvisle’s lack of scientific credentials, ‘unique’ environmental conservation perspective, and support of lax regulatory standards for industry).

Although it’s too early to speculate whether the Alberta Government is sincere in its commitment to create a competent oilsands monitoring program, history and the province’s initial steps indicate that it will have to do more than just promise an overhaul, but actually demonstrate it — externally.

More on RAMP:

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Straight Outta Edmonton: Overhauling RAMP

For 13 years, the Alberta Government has relied on the Regional Aquatics Monitoring Program (RAMP) to assess the impact of the oilsands. From resource development to environment, RAMP plays a significant role in developing provincial policy. 2004 RAMP Peer Review: “Reviewers reported serious problems related to scientific leadership and a

Continue reading

Straight Outta Edmonton: Overhauling RAMP

For 13 years, the Alberta Government has relied on the Regional Aquatics Monitoring Program (RAMP) to assess the impact of the oilsands. From resource development to environment, RAMP plays a significant role in developing provincial policy. 2004 RAMP Peer Review: “Reviewers reported serious problems related to scientific leadership and a

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Straight Outta Edmonton: WOA Profile: Lorraine Hoffman — Where Industry Meets Ancestry

“We’re all capitalists here. We’re not anti-industry, but we do strive to find a balance. We need to find sustainable ways of doing things.”

— Lorraine Hoffman, Athabasca Chipewyan First Nation Councillor


Work of Arts, the University of Alberta Faculty of Arts Alumni Magazine, has a great profile on Lorraine Hoffman, an alumni who is currently a councilor for the Athabasca Chipewyan First Nation (ACFN).

The piece highlights the complex relationship First Nation communities have with the oilsands. As Hoffman outlines, communities like Fort Chipewyan have benefited tremendously from partnering with industry. Yet, development has also led to the emergence of significant social issues, which have forced many to speak out.

Hoffman dismisses the notion that such criticisms indicate an anti-development bias from First Nation communities. In reality, these communities see development as a positive force, providing jobs and boosting local economies. However, there is a feeling that the current development approach is tilted towards industry at the expense of the environment and other local concerns.

What Hoffman calls for is a balance between development and these associated environmental, public health, and social concerns — similar to the language industry and the province uses to defend the current development policy that communities like Fort Chipewyan oppose.

Read the entire article: “Where Industry Meets Ancestry” by Benjamin Freeland.

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Straight Outta Edmonton: The Case for Science in Developing the Oilsands

“The debate about oil-sands extraction has become polarized, with players cast as either totally against, or for developing the sands rapidly without regard for environmental consequences. Both positions are based on very little evidence. A more moderate approach, with the pace of development based on solid environmental science, would be better in the long run.”

— Dr. David Schindler, “Tar Sands Need Solid Science,” Nature, November 25, 2010.

I support the Alberta Oilsands. I believe they are fundamental to the future prosperity of this province and Canada as a whole.

However, I don’t agree with how they are being developed. Our current development strategy fails to fully appreciate the tremendous value and responsibility that comes with the oilsands, in terms of the economy, environment, and legacy for future generations. From royalty rates to environmental monitoring, there are serious issues with the efficacy and consequences of current regimes.

A major issue is the lack of credible, scientific, peer-reviewed oilsands data to inform the public and policy makers on how to exactly develop the resource. How are Albertans expected to effectively participate in policy discussions concerning development when accurate information and studies are hidden from them? How are politicians able to develop an adequate long-term vision of the resource when they rely on pseudoscience?

Without accurate, scientific data, decisions are left to be made by individuals influenced by propaganda or innuendo. As citizens, we cannot allow the province to continue governing like this, particularly with projected development expected to expand significantly within the next decade. As Dr. David Schindler outlines in the above mentioned article, the stakes are too high.

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Straight Outta Edmonton: Review: World’s Greenest Oil – Turning the Oil Sands from Black to Green

For Peter Silverstone, cleaning up the oilsands has nothing to do with mitigating the effects of climate change. Rather, it has to do with mitigating the effects climate change has on oilsands.

In the World’s Greenest Oil: Turning the Oil Sands from Black to Green, Silverstone argues that whether or not you believe in human induced climate change, the world is moving in that direction and subsequent market shifts will significantly influence the attractiveness of the oilsands as an energy source.

Silverstone argues this by outlining various issues related to development and assessing their likely impact on the oilsands’ attractiveness. For example, many claim the shift away from open-pit mining to in-situ SAGD production will improve the industry’s international image, as pictures showing development transforming lush ecosystems into barren wastelands will be replaced by those revealing minimal environment impact.

Open-Pit Mining
In-Situ SAGD Production

However, current in-situ methods (SAGD) will actually make Alberta oil “dirtier,” as the process has a larger carbon impact than open-pit mining (though he notes that VAPEX, COGD, THAI, and other extractions methods may lead to significantly less emissions)

Further, Silverstone investigates the claim made by many Albertan politicians that if restrictive environmental legislation is passed in the United States, we could turn to markets in Asia who desperately need our oil. In reality, the transportation infrastructure required for Alberta to export a significant quantity of oil to Asia is decades away from completion and is facing significant opposition by British Columbians.

Even if built, the province wouldn’t come close to exporting the amount slated to be produced within the decade. There is also uncertainty as to whether countries like China and India would want to make major investments in the oilsands, as they are aggressively pursuing alternative energy sources domestically (China is the world’s biggest investor in renewable energy).

The solution, according to Silverstone, is to make Alberta an attractive energy provider by “greening” the oilsands. Specifically, he proposes to change Alberta’s current royalty framework to include economic incentives for industry to decrease its CO2 emissions. This will motivate companies to pursue extraction methods that are less energy intensive and invest in developing renewable energy sources, which can be used to power the extraction, upgrading, and refining of oilsands.

The World’s Greenest Oil is clearly written for an audience that is not familiar with the Alberta Oilsands and is an effective introduction to the issue. For each point he raises, Silverstone tries to provide the range of perspectives held, as well as an exhaustive list of sources, so readers can get a sense of the various positions and where to look for further information. In doing so, he focuses on simplicity and breadth, rather than detail, summarizing the issue and his argument in under 100 pages. Consequently, for people who already have a decent understanding of the Alberta Oilsands, it might be better to skip to the final chapter, where Silverstone introduces his policy proposal, rather than read the entire book.

However, a major limitation is the book’s narrow focus. At the outset, Silverstone clearly states he’s only interested oilsands development policy from a CO2 emissions standpoint, which he believes is the industry’s biggest threat. This may be true, but by ignoring oilsands industrial pollution, tailings ponds, and other factors, readers fail to recognize how these issues are shaping current debates.

For some reason Silverstone, and most other commentators, think they can omit these importance aspects from their discussions and still provide a comprehensive understanding of the issue. In reality, all these social and environmental issues are linked, significantly impacting how the world views the Alberta Oilsands and our subsequent development policy.

Overall though, the World’s Greenest Oil summarizes contemporary debates well and convincingly shows that Alberta needs to take a more proactive stance to ensure environmental issues that have arisen from oilsands development are adequately dealt with. Not only will this have social benefits, but it will also increase the attractiveness of the oilsands as an energy source — something that must be considered as international opposition to the Alberta Oilsands continues to grow.

World’s Greenest Oil: Turning the Oil Sands from Black to Green is available at Audrey’s Bookstore in Edmonton or online.

Update: Peter Silverstone discussing his book with the Edmonton Journal.

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