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Canada's Tar Lobby

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Issue: 56 Section: Business Geography: West Alberta Topics: oil, energy, tar sands, obama

September 8, 2008

Canada's Tar Lobby

Tar Sands Lobbyists Focus on US Democrats

by Chris Arsenault

Canada is the largest foreign supplier of oil to the United States, sending more than one million barrels of oil per day to its southern neighbour, about half of which originates from Alberta's tar sands. Barack Obama's top energy advisor has hesitations regarding the climate impact of Alberta's oil. Photo: Dru Oja Jay

As the US election campaign kicks into overdrive, Canadian politicians and oil executives are stepping up lobbying efforts to make sure whoever controls the White House keeps purchasing notoriously dirty oil from the Alberta tar sands.

Executives from energy company Nexen Inc., which has major investments in northern Alberta's heavy oil industry, and Tony Clement, chair of a Canadian cabinet committee on energy security, met with Democratic candidate Barack Obama's top energy advisor Jason Grumet in late August to cement the "energy partnership" during the Democratic National Convention in Denver, Colorado.

The closed-door meeting comes on the heels of comments made by Grumet and other Obama officials – comments that sent shivers through board rooms in Calgary and backhoes in Fort McMurray, the epicentres of Canada's oil industry.

In June, Grumet told reporters, "The amount of energy that you have to use to get that [tar sands] oil out of the ground is such that it actually creates a much greater impact on climate change."

"We [Obama's team] are going to support resources...that meet our long-term obligations to reduce greenhouse gas emissions. And I think it's an open question as to whether or not the Canadian resources are going to meet those tests," said Grumet prior to meeting the Canadian delegation at the DNC.

Currently, Canada is the largest foreign supplier of oil to the United States, sending more than one million barrels of oil per day to its southern neighbour. About half of this supply originates from Alberta's tar sands.

"Clearly the oil sands is the most high-impact oil available," said Simon Dyer of the Pembina Institute, an environmental watchdog.

"The oil sands are three times as greenhouse gas-intensive as regular oil," said Dyer, adding that roughly three barrels of water are required to process one barrel of heavy oil.

Tar sands production is set to increase from its current 1.2 million barrels of oil per day, to three million barrels per day by 2018, most of which is slated for export to the United States.

Tony Clement, the Canadian minister of health, told reporters at the DNC, "We [the Conservative government] have to be more aggressive in representing Canadian values and interests in the American political scene."

Neither Nexen Inc., nor Minister Clement's office returned phone calls requesting comment.

"The Canadian government is trying to deal through the back room rather than dealing with the environmental impacts of the oil sands," Dyer told this reporter. "Emissions from the oil sands are going to triple [by 2020] and that's inconsistent with the world's desire to lessen climate change."

In addition to official political pressure from Canadian cabinet ministers attempting to force Obama's hand on the tar sands, the oil industry has hired high-powered lobbyists of its own. Gordon Giffin, a former US ambassador to Canada, is now a registered lobbyist in Washington for the energy firm Nexen Inc.

Canadian oil executives attending the Democratic National Convention issued thinly veiled threats to the Obama campaign, stating that tar sands oil would be shipped to China if a new administration in Washington imposed restrictions.

"If you don't like the oil sands oil, what companies will do [in Canada] is build a bigger pipeline to the west coast and export it to China and India," stated Nexen Inc.'s Dwain Lingenfelter, the company's vice-president of government relations and a former deputy premier of Saskatchewan.

"If the US didn't want the oil, it'll go into the oil market anyway...So they have to be very careful about looking at the whole picture," Lingenfelter, the politician-turned-oil lobbyist, told the Toronto Star.

As competition for energy resources between China and the United States intensifies, Lingenfelter's lobbying may sound convincing, but his analysis shouldn't be taken seriously, according to the Pembina Institute's Simon Dyer.

"A potential pipeline to Asia [though the port of Kitimat] would have to cross the territory of 40 First Nations, where land claims and treaty rights are still hotly contested," said Dyer. "There is growing opposition to pipelines and growing oil sands opposition across the country, so those pipelines [to China] are by no means a done deal."

While pipeline routes out of Alberta will be a major topic of controversy for years to come, there is no doubt that Canadian oil is among the world's most climate-unfriendly fuels.

During his acceptance speech at the Democratic Convention, Obama promised to end US dependence on Middle East oil within 10 years, while stating that "government must lead on energy independence."

Environmentalists in Canada and the US contend that closed-door meetings with oil executives are not the best way to foster energy independence.

The current Canadian government, which draws its political and financial support from petroleum-producing regions in the West, is not seen as independent from oil interests. In July alone, oil sands companies held a total of 36 meetings with Canadian ministers and government officials, according to recently disclosed lobbying reports.

Meanwhile, environmental groups only held seven lobbying sessions and these were usually with ministerial assistants and other lower-level officials.

Chris Arsenault holds the Phil Lind Fellowship at University of British Columbia's Department of History. He is currently writing a history of sabotage and the Alberta oil patch. Anyone (nameless or not) who can provide information about this should contact him at arsenault_chris[at]hotmail.com. A version of this article was originally published by Inter Press Service.

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