B.C. Premier Christy Clark and Alberta’s Alison Redford (photo: Dan Riedhuber/Reuters)
VICTORIA – British Columbia Premier Christy Clark and Alberta’s Alison Redford have appointed a team of senior bureaucrats to develop an energy export plan, barely a year after a high-profile disagreement over the proposed Northern Gateway pipeline strained the two leaders’ relationship.
Clark and Redford are scheduled to publicly discuss the progress of the joint energy plan on Nov. 5 in Vancouver following the Alberta premier’s address to the city’s Board of Trade. A final report is due on Dec. 31.
Enbridge clash
The premiers are attempting to move past their very public clash over the Northern Gateway pipeline, which was the subject of a meeting in Calgary last October that Clark later described as “frosty.”
Clark had insisted the project must meet a series of conditions, including strict environmental standards and assurances that B.C. would receive a “fair share” the economic benefits, to win her approval, which prompted Redford to suggest Clark was attempting to pick Alberta’s pockets with demands for extra royalties.
“Frosty” relationship warming?
But a joint statement issued Tuesday was the latest sign that relations between the two premiers are warming. This past June, Clark and Redford met in Kelowna, B.C., and while they didn’t mention the Northern Gateway project, they announced the creation of a working group to focus on skills training, immigration and economic growth.
“In creating the working group, B.C. and Alberta identified the shared goals: opening new markets and expanding export opportunities for oil, gas and other resources,” and, “creating jobs and strengthening the economy of each province and Canada through the development of the oil and gas sector,” said Tuesday’s joint statement.
Clark and Redford both declined interview requests on Tuesday.
Alberta-B.C. working group
The Alberta-B.C. working group, jointly chaired by deputy ministers from both provinces, has been given a mandate to share information, collaborate on policy and address federal gaps on energy issues.
The terms of reference include five policy areas that mirror Clark’s five conditions.
The group has been directed to consult with First Nations; explore other resource transportation options, including rail; look at how to promote resources; and study ways to reduce the potential impact of oil spills. It is also to examine how to make sure both provinces receive a fair share of resource revenues.
“It is not about royalty sharing, but rather about receiving a fair share of the economic and fiscal benefits of a proposed heavy oil project that reflects the levels, degree and nature of the risk borne by B.C., the environment and taxpayers,” said the premiers’ statement.
[quote]Given the risk to B.C. from land-based and coastal bitumen spills, B.C. does not believe an equitable distribution exists for fiscal benefits. This imbalance must be addressed.[/quote]
First Nations remain opposed to Enbridge
Coastal First Nations spokesman Art Sterritt said northern B.C.’s aboriginals are opposed to seeing a pipeline built along their traditional territories and believe the risk of an oil tanker spill is too great to even contemplate. The Coastal First Nations group, which represents most coastal aboriginal nations from Rivers Inlet in southern B.C. to the Alaska border in the northwest, has been a staunch opponent of the pipeline.
Sterritt said his group intends to hold Clark’s Liberals to the government’s previous statements that the Northern Gateway pipeline, as it is currently proposed, fails to adequately address the potential environmental risks.
“They don’t have the technology,” Sterritt said from Terrace, B.C.
“The geography is not very friendly and there isn’t anybody in the north that wants the project. I don’t know how they are going to make it work.”
Sterritt said the possibility of transporting Alberta oil to the B.C. coast by rail, an option that will be considered by the working group, “boggles the mind.”
He warned that much of B.C.’s rain infrastructure runs over mountains and along rivers, meaning it wouldn’t change the potential risk of a spill.
Dix: Clark watering down “5 conditions”
The leader of B.C.’s Opposition New Democrats, Adrian Dix, said it appears the joint working group’s terms of reference are a watering down of Clark’s original five conditions.
Dix said the working group’s mandate appears more focused on ensuring energy projects like pipelines proceed as opposed to ensuring environmental safety and meaningful consultations with First Nations.
“It’s apparent on the B.C. side where their priorities are,” he said.
When most people talk of China and its environmental and energy challenges, they tend to paint a very bleak picture. While this view is historically justified, things are changing fast in today’s China.
Criticism of China’s environmental record has been traditionally well-justified. After all, China: 1) displaced the US as the world’s largest energy consumer as of 2009 – doubling its energy consumption between 2000 and 2009; 2) produces the world’s highest pollution levels, with 16 of the top 20 most-polluted cities in the world being in China; and 3) now has total annual vehicle sales higher than that of the US.
[quote]China went from 1% of the global market for solar technologies in 2004 to 50% by 2012[/quote]
Add to this picture the fact that approximately 62% of China’s current electrical power generation is derived from thermal, mainly coal-fired, generating plants and much of China’s industrial pollution emanates from plants with dated technologies.
China invests hundred of billions in green economy
The flip side to this gloomy portrait is that China is actively migrating to a green economy, albeit in sometimes chaotic fashion. Indeed, in 2012, China had the highest level of investments in clean energy, totalling $67.7B – up 20% from 2011 due to a solar sector surge. The US was in a distant second place with $42.4B in clean energy investments in 2012.
With these sharp contradictions, one might be tempted to conclude that China is schizophrenic on environmental issues. However, that would be unfair because the trends are shifting in favour of clean technologies, supported with massive investments by the national government.
In fact, in 2009, China committed a staggering $223B to clean technologies, sustainable development-related R &D, energy efficiency and emissions and pollution control. In August 2012, it announced a new plan for $372B up to the year 2015.
Concurrent with the aforementioned investments, under the 2009 China Renewable Energy Law, China introduced: 1) a Feed-in-Tariff (FIT) for renewables (a fixed price paid above market prices for all renewable energy sources that sell into the grid), and 2) Right-to-Connect obligations that require all grid operators buy all of the renewable energy produced in their respective regions. (Note: the FIT and Right to Connect formula was conceived in Germany and has since been copied by 40 governments around the world, including Ontario, until that province abandoned the model in response to a WTO ruling over provisions requiring the use of locally-built technology to qualify for the program).
China’s renewable energy quota
Complementing the FIT and right to connect programs, in 2012, China began to implement a quota system for provinces and cities for the amount of their energy that must come from renewable sources.
Against this backdrop, China has become the world’s fastest growing wind energy market. With 13.2 gigawatts (GW) of new wind power capacity added in 2012, the total wind installed capacity reached 75.6 GW by the end of 2012. (To put this in a relative perspective, Quebec’s current total installed electricity production capacity, including Churchill Falls, is 44 GW). Projections are for over 16 GW of new installations in 2013 and 17 GW and 18 GW for 2014 and 2015 respectively. China’s unofficial target is 200 GW by 2020, but that may prove an underestimate.
Half million wind sector jobs by 2020
In terms of jobs in the wind energy sector, the projection is that from the 150,000 jobs in China’s wind sector in 2009, the numbers will rise to 500,000 jobs by 2020.
Unfortunately, in its haste to advance its wind and solar energy sectors – from the development of clean energy manufacturing capacity to the construction of wind and solar farms – China “forgot” to invest in corresponding increases in electricity transmission capacity. Consequently, Chinese electrical grids are not in place to handle all of its new renewable energy production capacity, so 20% of wind production capacity was not connected in 2012.
To remedy the situation, China will build 19 new ultra high voltage lines, but the first two lines will not be ready until 2014. One of these lines will be 2,000 km long.
China offers green economy to the world
In the interim, with the help of generous state financing from the Chinese Development Bank and other sources, China began dumping its manufacturing surplus of clean energy technologies on global markets.
With respect to tariffs and Europe, following sabre rattling to the tune of an 11.8% introductory tariff on Chinese solar imports, effective June 6, 2013, on August 6, the EU decided not to impose planned provisional tariffs averaging 47%.That is, a preliminary truce was worked out on prices and a maximum export volume. Notwithstanding this preliminary agreement, Europe is keeping its options open for new tariff decisions at a later time.
China captures 50% of global solar market, runs into trade wall
Regrettably, up until the aforementioned trade wars, China’s photovoltaic (PV) solar manufacturing sector was almost entirely dedicated to global markets – with hardly any domestic market to speak of. China went from 1% of the global market in 2004 to 50% by 2012 – that is, up to when US and European tariffs eliminated China’s price advantage.
The US and EU tariffs having brought China back to earth, China is now more focused on internal solutions to its temporary surplus in solar manufacturing capacity.
China looks inward for new solar market
One of these internal solutions comes in the form of PV solar energy targets to install 10 GW/year in the 2013-15 period –quite a sharp increase from the total installed PV solar capacity at the end of 2012 at 5 GW. To encourage the private sector to get into the act – 40% of PV projects are represented by private developers – the Chinese government is offering 50% tax breaks for utility scale projects for that period. As a result, when the figures are in for the year 2013, China will likely be the world’s largest solar market.
What this will mean in terms of job growth in China’s solar sector may not be known for a while, but it is worth noting that prior to the new policies and targets mentioned above, there were 300,000 jobs in the PV solar sector in 2011. Another 800,000 Chinese people were employed in the solar heating and cooling sector in that same year.
But since domestic market growth by itself would still not be sufficient to address the solar manufacturing overcapacity and declining overseas demand, China has introduced tax breaks and other measures to encourage Chinese solar manufacturing sector restructuring. With the cap on exports to Europe – the world’s largest solar market – China has blocked access of its small solar firms to European markets.
Wind, solar to eclipse coal?
Where does all this lead? Well, Bloomberg New Energy Finance (BNEF) projects that 50% of China’s electricity will come from wind and solar energy by 2030 – roughly equal to that of coal. A recent story published in the Common Sense Canadian suggested that coal production in China will peak in 2015. This may suggest that these BNEF projections are too conservative.
One indicator that these clean energy projections may be too conservative or, at least, not tell the whole story, is China’s own recognition that overarching policies are essential to bring all sectors of the economy on side. More precisely, in May 2013, China’s National Development and Reform Commission began a process to explore cap and trade options, aiming to have one in place by 2016.
China exploring cap and trade
The review of this option began in June 2013 with the first of seven pilot carbon trading schemes in Shenzhen. The plan calls for strict emissions, pollution and energy efficiency standards for the industrial sectors by 2016, backed by stiff penalties for non-compliance. To assist industry to achieve compliance, loans would be made available to firms to invest in clean technologies. According to BNEF, if the power sector is faced with a price on carbon, greenhouse gases in China would peak around 2023.
As to why Shenzhen was chosen for China’s first cap and trade pilot, it may well be because that city’s green leadership, particularly in the area of clean transportation alternatives. To this effect, the city of Shenzhen has established a target to have more than 3,000 electric taxis, 5,000 hybrid and 1,000 electric urban transit buses around by 2015. Moreover, by 2015, the city will ban all vehicles that fail to meet in advanced emission standards. Not bad for the city that ranks second to Beijing as having the most vehicles in mainland China.
Warren Buffet joins the party in Shenzen
The audacity of Shenzhen complements that of the Warren Buffet-backed BYD of Shenzhen, which:
has become a world leader in all electric buses
will introduce its e-buses to Canada through pilot projects with the Société de transport de l’Outaouais (STO in the Gatineau area) and Société de transport de Montréal (STM)
has introduced its e-buses in a pilot in Frankfurt Germany
built an e-bus and electric car manufacturing plant Sofia, Bulgaria, which began operations in February 2013
is building an e-bus and an Iron-Phosphate energy module (large-scale battery) manufacturing facility in California that will be operational in late 2013.
Canada missing out on green economy
Meanwhile, back in Canada, Stephen Harper continues to present economic development and sustainable development as two opposing policy paths. This is true only as long as all of Canada’s economic eggs are in the old economy and one turns a blind eye as to what’s happening by way of economic paradigm shifts in China, Europe and the US.
Fracking protest in New Brunswick (photo: Colin McPhail)
by Emma Lui
Communities everywhere are calling for a stop to fracking – from Elsipogtog First Nation’s highway blockade in New Brunswick to Californians, New Yorkers and other Americans urging for a frackign ban on public lands to farmers occupying fields in Poland, to recent fracking protests in the U.K.
Quebec fracking moratorium
It was this sort of public pressure that prompted the Quebec government to place a moratorium on new fracking permits in parts of the St. Lawrence Basin in June 2011. With this law, less than one per cent of licenses in the total exploration area were revoked. In June 2013, a bill submitted to the Quebec National Assembly that would expand the moratorium to fracking in the lowlands of the St. Lawrence River.
If the law is passed, the moratorium would be in effect for a period of five years. Quebec’s anti-fracking movement has been incredibly strong with dozens of municipalities passing resolutions calling for a moratorium on fracking, frequent protests and a 700-kilometre march along from Rimouski along the St. Lawrence and Richelieu Rivers to Montreal.
Fracking’s water contamination
Fracking is a way of extracting natural gas – often using millions of litres of water, thousands of pounds of sand and thousands of litres of unknown chemicals, gas companies blast apart shale rock to release the trapped natural gas. U.S. and Quebec government studies have shown that some fracking chemicals include carcinogens and hazardous air pollutants.
Companies are not legally required to disclose the amount or type of chemicals they use and in fact this information is protected as a trade secret. Communities around the world have raised concerns about the impacts that fracking has on drinking water, greenhouse gas emissions and public health.
Given the red flags raised by indigenous communities, dairy farmers, U.S. doctors, German brewers and more recently even the European Union, you would think Quebec was well within its right to ban this risky practice until they had completed the necessary studies. Think again.
Lone Pine’s NAFTA challenge
Holding one of the revoked licences, Lone Pine Resources, an oil and gas company, is now launching a $250 million lawsuit against the Canadian government over Quebec’s fracking moratorium under the North American Free Trade Agreement (NAFTA). Although Lone Pine maintains all its operations in Canada, it’s registered in Delaware which allows it to make claims under NAFTA.
The company is claiming that Quebec moratorium is “arbitrary” and “capricious,” and that it deprives Lone Pine of its right to profit from fracking for natural gas in Quebec’s Saint Lawrence Valley.
Groups like the Council of Canadians, the Réseau québécois sur l’Intégration continentale, the Sierra Club, For Love of Water (FLOW), Eau Secours!, and AmiEs de la Terre have been gathering signatures for a letter to Lone Pine urging the company to drop plans to sue Canada and sending a letter to Lone Pine for every thousand signatures they receive. The groups issued a press release last week when they discovered that Lone Pine had quietly filed a request for arbitration indicating that the company was moving forward with the NAFTA lawsuit.
NAFTA Tribunal not accountable to Canadians
The lawsuit is very troubling. It undermines our basic notions of democracy, threatens needed environmental regulations, and puts private profits above the public good. What’s more, the lawsuit will not go through the public court system. The case will be heard before an unaccountable tribunal that may but is not required to consider issues of public health or water and environmental protections. The tribunal’s one concern is whether a government measure upsets the company’s broad set of rights in NAFTA.
And we could be seeing more cases like this where investor rights trump legitimate regulations protecting water sources, curbing climate impacts or safeguarding public health if trade agreements that are currently being negotiated are signed into law. The text of the proposed Trans-Pacific Partnership (TPP) between the U.S., Canada, and 10 other nations, is expected to closely mirror NAFTA’s investment rules, while Canada is in the final stretch for a deal with the European Union that would also provide those excessive powers to multinationals.
Trade deals, water and fracking
And it’s not just fracking bans or moratoria that can be challenged under these trade deals. The amount of water a fracking company draws could be subject to a trade agreement lawsuit if a government decides to cut back on the amount of water it had previously allocated for a fracking project. The Fort Nelson First Nation has been fighting applications for the withdrawal of three billion of litres of water per year from the Fort Nelson River for fracking projects in northeastern B.C.
Once approved, if the B.C. government decided to restrict the water withdrawals because of drought or other availability concerns, the government could open Canada up to another investor-state lawsuit. B.C.’s recent announcement of its LNG deal with Malaysia’s Petronas, one of countries that are involved in the TPP negotiations, is another reason alarm bells should be sounding.
UN: Water is a human right
In July 2010, the United Nations General Assembly passed a resolution recognizing the human right to water and sanitation and the UN Human Rights Council has also passed resolutions outlining governments’ obligations concerning the right to water and sanitation. This right is now enshrined in international law and Canada, like all other countries, must ensure its implementation.
Catarina de Albuquerque, the UN’s special rapporteur on the human right to safe drinking water and sanitation, wrote specifically about fracking and its relationship to the human right to water during her visit to the United States in 2011. De Albuquerque’s U.S. report highlights the concerns raised about the impacts of fracking on water and recommends that countries need to take “a holistic consideration of the right to water by factoring it into policies having an impact on water quality, ranging from agriculture to chemical use in products to energy production activities.” In order to protect the human right to water, governments of all levels must place a ban on fracking.
Study finds radioactive water from fracking
With the exorbitant amount of water used for fracking and the risk of water contamination – as seen with Duke University’s recent study warning that fracking is resulting in radioactive contamination in Pennsylvania rivers – communities must continue to call for a ban on fracking.
Communities have a right to say ‘no’ to fracking and any projects that threaten their water sources. So it’s even more crucial that communities pressure decision-makers to exclude investor-state dispute settlement processes from trade agreements so that communities safeguard not only their right but also their responsibility to protect water for current and future generations.
Emma Lui is a water campaigner with the Council of Canadians, based in Ottawa. Emma’s work focuses on the Great Lakes, human rights, water privatization and the connection between energy and water. She has worked at the Canadian Human Rights Commission and has an M.A. in political economy.
What was touted as a $36 Billion investment commitment by Malaysian LNG giant Petronas is actually a massive giveaway of natural gas by BC – valued at up to $400 Billion gross over the 25 year term of a secretive export licence being negotiated behind closed doors.
The headline blared out in the Globe and Mailearlier this week: “BC Minister says Malaysian investment vindicates Province’s bets on LNG sector”
The announcement comes as Coleman is about to depart for a whirlwind tour of Southeast Asia to promote BC LNG – including a trip to the world’s tallest twin towers, Petronas’ home base.
Petronas has long been at the table in BC and probably tops the long list of companies Coleman has signed non-disclosure agreements with, and we are beginning to see what those NDAs include.
Coleman has still not publicly admitted to having them and no reporter has reported on them but Coleman refers to them by saying he is having “very detailed confidential” negotiations.
Photo-op with Malaysian PM delivers nothing new
The Prime Minister’s photo-op announcement with Canadian PM Stephen Harper was therefore nothing new, but what was “newsworthy” was the dollar figures thrown around.
Not long ago, in a firestorm of controversy, Harper approved Petronas wading into the BC LNG market with a takeover of Progress Energy under his “new” foreign investment policies, which specifically forbade foreign state-owned enterprises (SOE) from taking over whole-cloth domestic-based companies – but Petronas was already in the door.
The focus has been, as many headlines exclaim, that Petronas is investing 36 billion dollars in BC LNG. Let’s take a closer look.
The real numbers
The Malaysian SOE has been the world’s second largest exporter of LNG behind Qatar. The oil and gas industry makes up 20% of Malaysian GDP. Fully 63% of their exports go to Japan.
Malaysia has therefor been quickly depleting their own resources and are fully dependent on the revenue streams from LNG – in fact, some regions of the small country actually import LNG and they have re-gasification projects underway in those jurisdictions.
Therefore, in order for Malaysian LNG to remain at the top of the game they need access to a cheap supply of gas, mostly, as we have seen, to continue to supply Japan, which may explain why Japan has a 10% interest in the Petronas BC LNG play.
And a play it is. The only new information Harper’s photo-op revealed was the investment figure of 36 billion dollars. This prompted Coleman to start foreshadowing the details of the “prosperity taxation regime” his party was re-elected on and British Columbians have long awaited.
Coleman selling snake oil
“We’re very close to that sweet spot,” the LNG minister said, noting he expected that details for the LNG Royalty Regime will be released in November.
[quote]We’re going to have to lock it down with some complex legislation to make sure people know there is some certainty around their investment in British Columbia so someone can’t come in and arbitrarily change it after you have made billions of dollars in investment in British Columbia.[/quote]
“Sweet Spot?…Lock it Down?” Wait a minute – this is not sounding very good and certainly nothing like the $100 Billion prosperity fund that will erase debt, lower taxes and provide vital services, which the Liberals campaigned on.
In fact, it is sounding a lot like trade and investment agreements where deals are negotiated in secret and the corporate rights they establish, including the worlds lowest royalty rates, are “locked in” for a generation.
Coleman goes onto claim that “We will not be beaten by anybody with regard to fundamentals.” Translation, we will be the cheapest operating district in the world by charging the lowest royalty rates, providing the best subsidies and tax breaks, and offering the least government intervention on issues related to the build out processes and pipeline approvals, including environmental protection.
Oddly, Coleman claims that locking all this in, much like the Chinese FIPPA agreement does, is an imperative and must be done to secure the investment and provide certainty. However the 36 Billion dollar figure from this one SOE, is an estimated figure over 30 years and requires no such up front commitments as it is Petronas who need access and we have at least 12 companies lined up for our supply.
No Final Investment Decision expected until end of next year
It gets worse. This “vindication” of Coleman is still not a Final Investment Decision (FID) – when a company truly ponies up the big bucks. In fact, Malaysian newspapers touted it as a step to securing a MASSIVE 25-year export license for 19.68 million tonnes a year for 25 years. That is one hell of a lot of fracking gas.
The headline in the Malaysian Business Times is much different than all the headlines in Canada – it reads: “Petronas Eyes Canada License“. The first line of the story claims the export license is required before any investment talks can move further.
Far from vindication, the Malaysians see their 36 billion dollar carrot as a play to secure our huge, massive, longterm supplies at rock-bottom prices, with a royalty “sweet spot”, formerly known as a regime, that is the lowest in the world.
So there will be no commitment on this deal unless we roll over and hand over hundreds of billions of dollars worth of natural gas to them – then and only then will they take the “next step.”
Therefore, Canadian headlines claiming this is vindication and a done deal that is worth 36 billion could not be further from the truth. This is not an FID. The 36 billion dollars is an estimate ranging over 30 years into the future, which is not guaranteed, and involves everything from pipelines and infrastructure to all sorts of other anomalies, otherwise known as bullshit.
The only thing new being announced is the dollars involved, and the play is on us as Petronas desires one thing: certainty. Translation: locked-in royalties and a license to export.
We have to wait until next month to hear how Coleman sold us out on the royalty “sweet spot”, but we can do the math now on the HUGE sellout we are seeing with respect to the export license.
Hold on to your hat.
Petronas is applying for 19.69 million tonnes a year for 25 years. There will be no FID without it. To put that in perspective, this one export licence would be for roughly the same volume as the entire annual LNG exports for Australia – a major player in the industry, far more developed than BC.
Let’s unpack that and see what kind of return a promise of $36 billion over 30 years gets a foreign SOE, shall we?
1 ton = approx. 50 million BTU (MMbtu – the standard tradable unit for gas)
20 million tonnes = 1 Billion MMbtu
Now look at this chart of going rates per MMBtu:
According to this chart, the export license Petronas demands before it will spend a nickle is worth at least$4 BILLION a year (gross). That’s based on roughly $4/MMBtu on the domestic Henry Hub market, times 1 Billion units.
That’s on the low end, based on North American values. The whole point of exporting this gas is to achieve a higher price on the Asian market – so the real value is likely much higher.
Up to $16 Billion a year
On the high end, remember 63% of Malaysian LNG exports go to Japan and Japan has a 10% stake. Based on current values of roughly $16/unit in Japan (the whole point of exporting LNG to new markets), that means more like $16 Billion/year (gross)
Yes, $16 Billion dollars per year for 25 years, all to secure an investment of 36 billion over 30 years.
In other words, Petronas wants an export license valued between 100 – 400 Billion dollars, to secure 36 Billion dollars in investment.
Environmental consultant Jessica Ernst on her land in Alberta (Colin Smith photo)
ROSEBUD, Alta. – An Alberta woman has lost a round in her legal battle against the contentious process of hydraulic fracturing.
Jessica Ernst launched a $33-million lawsuit against the Alberta government, the province’s energy regulator and energy company Encana (TSX:ECA).
She claims gas wells fracked around her property in southern Alberta unleashed hazardous amounts of methane and ethane gas and other chemicals into her water well.
An Alberta Court of Queen’s Bench judge has ruled Ernst can’t sue the regulator because under provincial law it is immune from private legal claims.
Ernst says she plans to appeal the ruling, and says the lawsuit against Encana and the provincial government will proceed.
In its statement of defence, Encana denies all of Ernst’s allegations.
“It is worrying that citizens are unable to hold the energy regulator accountable for failing to protect citizens from the harmful impacts of fracking,” Cory Wanless, a lawyer for Ersnt said in a release Wednesday.
Hydraulic fracturing involves pumping water, nitrogen, sand and chemicals at high pressure to fracture rock and allow natural gas or oil to flow through wells to the surface.
In his ruling, Chief Justice Neil Wittmann dismissed an application by the Alberta government to remove some other parts of Ernst’s lawsuit that involve the province.
Wanless says the Alberta government has not filed a statement of defence in the case.
Fracking operations in BC’s Montney Shale (photo: Damien Gillis)
Beneath the glowing rhetoric surrounding BC’s promised liquefied natural gas (LNG) boom lies a dirty little secret: the vast majority of the industry would be powered by controversial fracking in northeast BC. Add that to the huge carbon footprint and local air pollution from the plants themselves and “clean” LNG becomes an oxymoron of epic proportions.
Dirty fracking
The relatively new technique of fracking involves hoovering up enormous volumes of water out of lakes and rivers, injecting it with fine sand and largely unknown, toxic chemicals, then blasting this cocktail deep underground to crack open shale formations where gases are “trapped” (as if they’re just begging to be freed!).
[quote]Every time you hear LNG, think of one of the least efficient energy systems every invented. Think fracking. Think water contamination. Think asthma. Think climate change…[/quote]
This “game-changing” combination of technologies has, in the decade or so that it has been in widespread use, provoked a wave protests, bans and moratoriums around the world, over its impacts on air, water, and human health.
In touting the economic potential of LNG terminals on BC’s coast – of which a dozen or so have been proposed, along with four major pipelines to supply them with gas from northeast BC and Alberta – the BC Liberal Government ignores the fact that they would be powered by what shale gas expert David Hughes calls “a very aggressive increase in the number of fracked wells in northeast BC”.
LNG = Way, way more fracking
Today, BC produces about 4 billion cubic feet a day of natural gas. It has taken us 50 years and 39,000 wells to get to this point.
Construction of Spectra’s Horn River gas plant in 2011 (Damien Gillis)
The consequences are evident whenever you fly over the Peace Valley region near Fort St. John, or the Horn River Basin, northeast of Fort Nelson. Geometrical patterns of well pads, industrial roads, seismic lines, processing plants, compressor stations and massive water pits carve up the northern Boreal landscape as far as the eye can see.
It’s hard to imagine what a several-fold increase in all this activity would look like, but that’s precisely what would be required to power BC’s LNG industry.
Presently, a little under half the gas coming out of BC is from fracking – the rest from “conventional” gas plays. But that balance is quickly shifting. We’ve already tapped most of the easy, lower-impact stuff and the majority of new supplies will come from shale gas.
BC’s Minister of Natural Gas Development, Rich Coleman, recently revealed the extent of his government’s vision for “clean” LNG: they want to see five of these plants built, with three up and running by 2020.
If you look at the volumes of the four pipelines proposed to supply these plants – two to Kitimat, the other two to Prince Rupert – the combined capacity ranges from 10-15 billion cubic feet/day (2.5 to almost 4 times our current production).
Minister Coleman intends to continue supplying BC’s own energy needs and our Canadian and US customers – this new LNG would come on top ofthat 4 billion cubic feet/day.
That means a several-fold increase in gas production into the distant future. Since most of that new supply would have to come from fracking, you can see why a massive increase would be required to feed LNG.
The impacts would extend in many directions. The 11 billion or so litres of water reported by the Oil and Gas Commission as used and contaminated for fracking each year in BC would be upped several-fold – this in a region often beset by drought conditions. The potential health impacts (only now being investigated by the BC government) from flaring, escaped methane and even more toxic gases would also be ramped up accordingly.
See timelapse animation of increasing water withdrawals for fracking in the Horn River Basin (story continues below).
Fracked-up economics
Fracking has been a victim of its own success. While it has opened up new supplies of previously inaccessible gas, the combination of this new technology and reduced royalties from governments like BC’s to incentivize development has seen the North American market flooded with gas.
The result has been tremendous downward pressure on domestic prices. A resource that once fetched $8-plus per unit, is now routinely below $4, sometimes much worse. But in Asia, prices have remained high – upwards of four or five times the local price. So the big idea is for North American producers to access these markets and capture higher returns. (I won’t touch the reams of evidence undermining this model here – we’ll cover that in the next piece in this series).
Climate and air pollution
The problem is that in order to carry the gas to these overseas markets, it has to be cooled to minus 160 degrees celsius, and that takes enormous amounts of energy – far more than we can supply with our public electricity system (though the BC government wants to flood a 100km section of the Peace River to build a dam that would help power LNG plants through taxpayer-subsidized pubic energy).
So a government that just a few years back brought in a “Clean Energy Act” with much fanfare is now back-pedalling, allowing the industry to use its own gas to create electricity to cool and liquefy the gas. The result would be a massive increase in BC’s carbon emissions.
More than that, local residents in Kitimat and Prince Rupert could see dangerous increases in air pollution. The BC government only recently announced a study into air pollution from three proposed Kitimat plants for local residents. With the modernization of Alcan’s Kitimat aluminium smelter set to double its SO2 output, even a government bullish on LNG is compelled to consider what these new LNG plants would mean for public health.
Yet an air pollution expert from the University of British Columbia, Prof. Douw Steyn, feels the $650,000 budget and six month timeframe for the study is woefully inadequate. I can understand why they want it. “The big question is: ‘Is that timeline being driven by the cause of industry or by prudent science,'” Steyn asked upon the study’s announcement last week.
Moreover, why weren’t these studies carried out before the government staked BC’s economic future on an LNG boom?
BC’s low standards
A recent study by Clean Energy Canada found that even if we’re to ignore the dirty source of BC’s LNG (fracking), the cooling process itself would be far dirtier per unit of energy produced than comparable operations in places like Australia and Norway – further putting the lie to Coleman and co.’s “world’s cleanest LNG” boasts.
In closing, let me describe, in a nutshell, BC’s economic vision, if this LNG scheme proceeds as planned:
We will take tens of billions of litres of water out of our rivers and lakes, inject them full of chemicals, then use enormous amounts of energy to blast this concoction underground and recover gas. More energy will then used to clean and process the gas, before it’s piped 800 km across northern BC, powered by more, energy-intensive compressor stations along the way.
Then, even more gas and electricity will be consumed in massive quantities to cool the gas, which will be loaded onto ships whose trans-Pacific voyage is powered by even more gas. Meanwhile, another ship carries our raw logs and metals to a factory in China, where our gas is burned so those raw materials can be manufactured into finished goods, which are then put on a ship, fuelled by bunker diesel, on its way back to Canada.
All so those goods can be trucked to a Walmart, where we can drive our cars to save a few bucks on a cheap table that ends up in the landfill a few years later.
That’s the future BC’s politicians are trying desperately to build. There is nothing “clean” or visionary about it.
So every time you hear LNG, think of one of the least efficient energy systems every invented. Think fracking. Think water contamination. Think asthma. Think climate change…
Following Japan’s devastating 2011 earthquake and tsunami, fear spread about risks of leaked radiation from the Fukushima Daiichi nuclear power plant – for the health of those living in or near Fukushima or involved in cleanup efforts, and for the planet and the potential impacts on our complex marine food web.
Shunichi Tanaka, head of Japan’s Nuclear Regulation Authority, told reporters radioactive water has likely been leaking into the Pacific Ocean since the disaster hit. It’s the largest single contribution of radionuclides to the marine environment ever observed, according to one report. With 300 tonnes of contaminated water pouring into the sea every day, Japan’s government finally acknowledged the urgency of the situation in September.
[quote]I’m taking a precautionary approach: fish will stay part of my diet, as long as they’re caught locally and sustainably, and will remain so until new research gives me pause to reconsider.[/quote]
Social media is now abuzz with people swearing off fish from the Pacific Ocean. Given the lack of information around containment efforts, some may find this reasonable. But preliminary research shows fish caught off Canada’s Pacific Coast are safe to eat.
Fish testing shows low radiation levels so far
It will take about three years from the time of the incident for Fukushima’s radiation plume to reach the West Coast, which would be early next year. Recent testing of migratory fish, including tissue samples collected from Pacific bluefin tuna caught off the California coast, assessed radiation levels and potential effects on marine food webs far away from Japan. Trace amounts of radioisotopes from the Fukushima plant were found, although the best available science puts them at levels below those naturally occurring in the environment around us. Natural, or background radiation, is found in many sources, including food items, medical treatments and air travel.
The most comprehensive health assessment, by the World Health Organization, concludes radioactive particles that make their way to North America’s waters will have a limited effect on human health, with concentrations predicted to be below WHO safety levels.
More reports are in the works. The UN agency charged with assessing global levels and consequences of ionizing radiation will present its findings to the UN General Assembly this month. This is where we may find answers about the amount of radioactive material released, how it was dispersed and any repercussions for the environment and food sources.
Fukushima radiation diluted by currents
The ocean is vast and dynamic with many complexities we don’t fully understand. It appears two currents off Japan’s coast — the Kuroshio Current and Kurushio Extension — diluted radioactive material to below WHO safety levels within the first four months of the disaster. Eddies and giant whirlpools, some tens of kilometres wide, continue the dilution and will direct radioactive particles to coastal areas for at least two decades.
Fish from the water near the crippled plant are not faring so well. High levels of cesium-134, a radioactive isotope that decays rapidly, were found in fish samples there. Radiation levels in the sea around Japan have been holding steady and not falling as expected, further demonstrating that radiation leakage is not under control. At least 42 fish species from the immediate area are considered unsafe for consumption, and fisheries there remain closed.
New concerns from continued leaks
New concerns continue to arise. While the initial leak contained cesium isotopes, water flowing into the ocean from the plant now appears to be higher in strontium-90, a radioactive substance that is absorbed differently. While cesium tends to go in and out of the body quickly, strontium heads for the bones.
A huge accumulation of radioactive water at the plant must be dealt with immediately. Determining the full effects of years of exposure to lower levels of radioactive contamination leaking into the ocean will take time and require continued monitoring and assessment. While Health Canada monitors radionuclide levels in food sold in Canada, and one of its studies incorporates samples from Vancouver, we need to remain vigilant and demand timely monitoring results.
Any amount of leaked radiation is harmful to the planet and the health of all species, including humans. A major release of radioactivity, such as that from Fukushima, is a huge concern, with unknowns remaining around long-term health risks such as cancers.
That doesn’t mean it’s unsafe to eat all fish caught on the Pacific West Coast. I’m taking a precautionary approach: fish will stay part of my diet, as long as they’re caught locally and sustainably, and will remain so until new research gives me pause to reconsider.
With contributions from David Suzuki Foundation Communications Specialist Theresa Beer.
Malaysian PM Najib Razak and Stephen Harper (AP/Lai Seng Sin)
During a recent state visit by Canadian Prime Minister Stephen Harper to Malaysia, host PM Najib Razak pledged a “gargantuan” investment of $36 Billion for gas infrastructure in British Columbia, through national energy company Petronas.
The Sunday announcement comes following last year’s controversial $5 billion-plus takeover of Canadian company Progress Energy and early-stage plans for a pipeline and liquefied natural gas (LNG) plant near Prince Rupert, on BC’s north coast. It also marks the first tangible “final investment” commitment from any of the dozen or so LNG proposals that have flooded BC over the past couple years, involving more than 20 local and international players.
While companies like Chevron and Apache have together ponied up $500 million for engineering, surveying and early construction work (Chevron and Apache’s joint venture in Kitimat is the only one so far to obtain required permits), none have taken the plunge on the tens of billions required to follow through on their pipeline and LNG plans.
$36 Billion – that’s a lot of ringgits. If it were my state-owned energy company, I’d want to be darned sure my investment was justified.
So here is a little unsolicited investment advice for Mr. Razak, free of charge.
We don’t actually have all that gas
If you listen to BC’s Minister of Natural Gas Development, Rich Coleman, BC has discovered a magical, bottomless well of gas – through the controversial, new extraction method of hydraulic fracturing, or “fracking”. Mr. Coleman may indeed have a boundless source of fuel: it’s called hot air.
While we’ve uncovered new supplies in northeast BC, trapped in shale formations deep underground, the numbers being quoted by the likes of Coleman are wildly out of touch with reality.
I put Mr. Coleman’s figures from a recent speech at the Union of BC Municipalities’ annual convention in Vancouver to one of Canada’s top independent shale gas experts, David Hughes. Mr. Hughes is a recently retired 32-year senior geoscientist and manager for the Geological Survey of Canada. He led the development of the federal government’s coal registry and was team leader for unconventional gas on the Canadian Gas Potential Committee.
In short, the man knows what he’s talking about – and he’s not speaking for industry or government.
In his speech, Coleman boldly predicted BC has enough gas to supply 5 LNG terminals for 84 years – on top of local needs and sales to Canadian and US customers – while using only 30% of our known reserves.
As Mr. Hughes counters, drawing on data from BC’s own Oil and Gas Commission (you’d think the minister would check his own government’s figures!), that statement represents an exaggeration of about 4000% from our real known reserves:
[quote]To put it bluntly, BC has 34.6 tcf of reserves in the bank and Rich is counting on 1365.4 tcf of undiscovered gas to be discovered and recovered, to cover his LNG projects and commitments to North America…[/quote]
Surely, there will be new discoveries to come – particularly in the yet untapped Liard Basin, where Apache claims to have found monster reserves through recent test drilling – but that’s not what Mr. Coleman is saying when he uses the term “known reserves”. Moreover, the idea that we will discover 40 times more gas – let alone that all that proves recoverable – simply stretches the imagination.
Even if Petronas was the only LNG project and pipeline (one of four major ones proposed) to go forward, the availability of gas required to fill these demands and justify this kind of investment is highly questionable – nay, darned near impossible.
At the moment, BC produces about 4 billion cubic feet/day (bcf/day) of gas. The capacity of Petronas’ proposed pipeline, to feed its LNG terminal with gas from northeast BC, is 2-3.6 bcf/day. That means an increase of half to almost all of the gas produced in BC today, just to fill Petronas’ pipeline and plant.
Minister Coleman’s answer to skeptics? “I’m an optimist!”
That’s all good and fine – I just hope the decision-makers in Malaysia have a few realists on the payroll.
Fracking’s unprecedented decline rates
Even if it were possible to fill Petronas’ pipeline in the short term – again, assuming it beats out all its competitors to secure this supply – Prime Minister Razak acknowledges this project is a “long-term” investment.
Staggering decline rates for major US shale gas plays (graph: David Hughes)
The experience of Amercian fracking companies – the first out of the gate with this technology – should raise some big, red flags. Today, some of the major, early fracking booms south of the border are going bust – in places like Pennsylvania’s Marcellus shale.
Why? As Hughes points out, after analyzing years of actual wellhead and production data, the decline rates for unconventional shale gas are far steeper than they are for conventional supplies – of which we’re fast running out. The top 5 shale gas plays in the United States, which account for 80% of all shale gas production, are seeing an 84% decline rate over 3 years. That means that while plays like Petronas’ north of Fort St. John, BC, are pumping out large volumes today, they may quickly dwindle.
These are US figures – we won’t know until more specific BC wellhead data is analyzed just what decline rates look like here. Nevertheless, this should ring some alarm bells.
Mr. Hughes says that just for America’s shale gas production to remain flat – keeping ahead of these huge fall-off rates – would require 7,600 new fracking wells every year, at a cost of $42 billion. So Mr. Razak’s $36 Billion might not go as far as he thinks.
LNG’s exploding costs
It’s not clear how earlier discussion of a $20 Billion investment in BC gas infrastructure ballooned to $36 Billion with this announcement, but it may be a prudent reassessment.
This kind of infrastructure has a history of ballooning budgets, as we can witness with Australia’s massively over-budget Gorgon plant, being built by Chevron. As of last year, the project had exploded to $52 Billion form original estimates of $37 Billion – and at that time it was still 18 months away from completion. So be prepared to chip in some extra ringgits on top of that $36 Billion.
Environmental issues
Most of this new gas would have to come from what Mr. Hughes calls “a very aggressive increase in the number of fracked wells in northeast BC.” Fracking has ignited a wave of protest around the world – particularly in the US – driving bans and moratoriums in dozens of jurisdictions. While concerns in BC have remained relatively muted so far, Canada is already seeing a strong reaction to the controversial practice.
Quebec passed a moratorium last year, and in New Brunswick, opposition from local aboriginal communities and their supporters is heating up fast, forcing a meeting with the province and RCMP. Quebec’s moratorium has led to trade strife, with a NAFTA challenge launched against the province last week.
In the Yukon, First Nations recently passed a resolution against fracking over concerns for its impacts on their water.
How long before BC joins this chorus of fracking protests? With evidence of water contamination and air pollution impacts mounting, can BC remain an opposition-free haven for shale gas for the decades Malaysia requires to recoup its investment?
Indigenous opposition
Surely, Malaysia’s energy advisors are aware of the impact First Nations opposition to the Enbridge Northern Gateway project has had on that proposed oil pipeline and terminal’s prospects.
While the perception is that BC’s First Nations are largely supportive of fracking and LNG so far, beneath the surface, there are already cracks forming.
I recently interviewed a hereditary chief whose nation is steadfastly opposed to all pipelines proposed to cross its territory, which includes Enbridge and two gas pipelines. Petronas may be able to skirt this particular 22,000 square km territory with its pipeline routing, but that assumes neighbouring nations don’t follow suit.
All it takes is serious opposition from First Nations at one of the many points along the gas’ trajectory to tankers on the coast and Malaysia’s massive investment will be put in real jeopardy.
Getting off on the wrong foot with disappearing river
Petronas still needs to receive environmental approval for its proposed pipeline and plant – and that may prove more difficult than it assumes.
After The Common Sense Canadian and other media outlets took the story public from a release by West Coast Environmental Law, the Canadian Environmental Assessment Agency agreed to extend the public consultation period on Petronas’ draft plan – acknowledging the mistake and inserting a proper map into the project description.
The terminal would indeed pose a serious threat to beleaguered Skeena salmon stocks, encroaching on important estuary habitat. Some upstream First Nations were forced to cut their food fishery this year for the first time in memory as a result of collapsing stocks.
The message to Malaysia is this: Canadians care a great deal about their salmon. Don’t expect this plant to sail through environmental assessment, and even if it does, don’t expect an easy ride.
Treading on Bear Country
Petronas faces another environmental battle over its proposal – the plan to bisect a the Khutzeymateen Grizzly Sanctuary. This special section of protected bear habitat lies in the path of Petronas’ proposed pipeline to the coast, a fact that has angered some of the province’s top bear biologists and already stirred up controversy in the media. Petronas should ask Enbridge about its experience infringing on BC’s Great Bear Rainforest to get some idea what kind of backlash awaits their project over the pipeline route.
Finally, with local air pollution concerns being raised and citizens beginning to delve into the enormous potential impacts of LNG – as I observed on a recent speaking tour through five northwest BC communities – companies like Petronas will face mounting opposition to their plans.
A little food for thought for Prime Minister Razak before he plunks down all those ringgits.
Petronas Towers, Kuala Lumpur, Malaysia (photo: Mike Bell)
by Bruce Cheadle – Canadian Press
NUSA DUA, INDONESIA — Prime Minister Stephen Harper arrived in Bali for an Asia-Pacific leaders’ summit Sunday bearing what could be called a $36-billion vote of confidence from Malaysia’s state-owned oil and gas company.
Malaysian Prime Minister Najib Razak sprung the “gargantuan” investment figure during a joint availability with Harper in Putrajaya, saying Malaysia’s state-owned oil and gas company Petronas has committed to construction of a liquid natural gas plant in British Columbia and the pipeline to feed it.
“I’m told that this is the largest direct foreign investment in Canada by any country,” Najib said, flanked by Harper following a formal welcoming ceremony at a sprawling new government precinct outside the Malaysian capital of Kuala Lumpur.
Najib called it a “significant landmark decision” by Petronas, which last year spent more than $5 billion buying Alberta-based Progress Energy Inc.
Malaysian takeover of Canadian company prompted tougher rules
The Petronas takeover, and a bigger oil patch buyout by China’s state-owned CNOOC, prompted months of hand-wringing by the Harper government. It approved the deals late last year but at the same time introduced new rules that permit majority takeovers of Canadian companies by state-owned enterprises only in the most exceptional circumstances.
The policy change put a major chill on direct foreign investment in Canada by so-called SOEs, and analysts have recently begun questioning whether the Conservative policy shift is scaring off much-needed foreign capital.
Najib rode to Harper’s defence Sunday, calling the promised Petronas infrastructure investment a testament “to the level of confidence we have in the policies of the Canadian government.”
Harper’s reaction to the news was almost muted, by contrast.
“Look, we view the Petronas investments very positively and all the indications I have is that Petronas is looking at further investment,” said the prime minister.
“The government of Canada is very excited about that possibility, as are all those I’ve talked to in the energy sector.”
Confusion over Petronas’ whopping, new numbers
However the Prime Minister’s Office declined to provide any details of the promised $36-billion investment, referring reporters to Petronas for details. Provincial officials in B.C. had spoken in June of a $19-billion LNG plant and pipeline investment by Petronas, and it wasn’t clear Sunday where the whopping new total comes from.
Both Najib and Harper flew their separate delegations to Indonesia following the Sunday morning meeting in Malaysia.
Regardless, the announcement provides Harper a much-needed shot in the arm as he brings Canada’s trade and investment message to Bali.
Harper faces challenges on fossil fuel exports
Harper has been involved in an increasingly acrimonious and very public tussle with U.S. President Barack Obama over the proposed Keystone XL pipeline to take Alberta bitumen south, and is meeting stiff resistance within Canada to the proposed Northern Gateway pipeline to the B.C. coast.
The Conservatives have also failed to seal the major trade pacts they’ve been negotiating, and Najib appeared to confirm Sunday that the proposed Trans-Pacific Partnership, involving 12 Pacific Rim counties including Canada, won’t meet its year-end target for completing a framework agreement.
So Harper, who has prorogued parliament and will deliver a throne speech Oct. 16 setting out a new government agenda, needs some good economic news to bolster his case.
Najib was asked by a Malaysian reporter what guarantees Petronas had been given on its multi-billion-dollar Canadian investment “over 30 years.”
The investment has a long horizon, Najib agreed, adding he is confident that not only the current Conservative government would support Petronas’s Canadian involvement, but so would future governments.
Harper, who has never shied from throwing partisan jabs while representing Canada abroad, took the opportunity to take a swipe at both the Liberals and the NDP. He said Liberals have always approved any foreign investment “no matter what,” and that New Democrats “are ideologically opposed to investment.”
Tough balancing act on foreign takeovers
Harper said his government judges each foreign investment “on its merits” and called it a policy of “discretion.”
It’s a fine balance for a Conservative government that says it is courting Asian markets and wants to make Canada an “emerging energy super power” but has faced a backlash from its political base over foreign — especially Communist Chinese — state-owned enterprise takeovers.
The policy shift has not been welcomed in China, noted analyst Yuen Pau Woo, president of the Asia Pacific Foundation of Canada.
Malaysia, which has few state-owned enterprises, won’t much mind, Woo said in an interview — “they’re in the barn already” — but China has a host of state-owned companies looking to expand and Canada is not sending welcoming signals.
Harper said all western governments have some tough choices to make but that Canada is well positioned.
“Look, it’s no international secret that the rise of China and of Asia in the minds of all of us is likely to be one of the dominant realities of the coming century,” Harper said Sunday.
“Western countries certainly will have their place in the world — provided that we make good decisions.”
He said Canada must “avoid some of the pitfalls of other western countries,” without citing any foreign examples.
Budgetary and political gridlock in Washington has shut down the U.S. government and will prevent President Obama from attending the APEC summit here.
Najib graciously offered that Asia’s rise will be a global boon “and we believe that we should prosper together.”
Billionaire Keystone XL pipeline opponent Tom Steyer (photo: Getty Images)
OTTAWA – An anti-Keystone XL pipeline crusader has written to Prime Minister Stephen Harper, suggesting Canada’s aggressive lobbying for the project played a part in the ongoing government shutdown south of the border.
Tom Steyer, a San Francisco billionaire who’s also a major Democratic party fundraiser, chastises Harper for saying he would not “take ‘no’ for an answer” from U.S. President Barack Obama on TransCanada’s Keystone XL.
In a question-and-answer session with the Canadian American Business Council last week in New York, Harper took a hard line on how Canada would respond if the Keystone XL project is rejected by the White House.
“My view is you don’t take ‘no’ for an answer,” Harper said. “This won’t be final until it’s approved and we will keep pushing forward.”
Steyer took issue with those comments in his letter to the prime minister Friday, asking:
[quote]Have your government, your government’s lobbyist and/or agents representing TransCanada communicated with House Republicans about including Keystone in the original litany of demands put to President Obama?[/quote]
Steyer says in the dispatch that TransCanada is launching a new advertising campaign aimed at stakeholders in Washington, D.C.
“News of this advertising campaign comes in the context of House Republicans having closed down the U.S. government as well as threatening to oppose the extension of the country’s debt limit unless certain demands were met,” Steyer writes.
“Included in the original list of House Republican demands was that the Obama administration grant approval for the building of the Keystone XL pipeline.
The combination of the advertising campaign and Harper’s comments last week “raises the question of whether your office is working hand-in-hand with TransCanada to try to exploit the current situation in Washington, D.C., at the expense of the American people,” Steyer wrote.
The Prime Minister’s Office didn’t respond to queries about Steyer’s letter. Harper is currently in Southeast Asia for an economic summit with Pacific Rim countries.
Harper’s strong-arm tactics counter-productive?
The majority of Republicans in the House of Representatives, and some Democrats, have long been staunch supporters of Keystone XL and have tried in the past to insert pipeline provisions into bigger pieces of legislation.
Privately, however, some TransCanada officials have bemoaned the strong-arm tactics of some of their Republican cheerleaders.
Just this week, TransCanada’s director of the pipeline said a legislative effort by Republicans in 2012 to push Obama into approving Keystone XL unnecessarily delayed the project.
“As you recall, 2012 was an election year and politics began to weigh heavily into that process and some political manoeuvring occurred,” Les Cherwenuk said in Houston at an energy roundtable.
The president “couldn’t (approve the project) fundamentally, since the work had not been completed and he had no choice but to deny the permit.”
In early 2012, Republicans pushed a mandate through Congress demanding Obama approve the $5.3-billion pipeline within a strict deadline. But the State Department was still assessing the project amid concerns from the state of Nebraska that Keystone XL posed risks to a crucial drinking water aquifer.
The president invited TransCanada to submit another application, one that would reroute the pipeline around the aquifer.
The pipeline has become a flashpoint for U.S. environmentalists who hold it up as a symbol of America’s over-reliance on carbon-intensive fossil fuels. They argue that approving Keystone XL will encourage oilsands crude production, which emits more carbon into the atmosphere than conventional oil production.
Steyer, a former hedge fund manager who hosted Obama in his home for a Democratic fundraiser in the spring, left his firm to devote himself entirely to climate change issues. He’s emerged a major thorn in the side of pipeline proponents, and recently launched a series of TV commercials maligning Keystone XL.
