Tag: Canadian oil sands

Canada’s Contribution to U.S. Energy Security

Let’s start with some basic facts about Canada’s contribution’s to the U.S. economy From the Energy Information Administration background sheet:

In 2006, Canada produced 19.3 quadrillion British Thermal Units (Btu) of total energy, the fifth-largest amount in the world. Since 1980, Canada’s total energy production has increased by 87 percent, while its total energy consumption has increased by only 44 percent. Almost all of Canada’s energy exports go to the United States, making it the largest source of U.S. energy imports. Canada is consistently among the top sources for U.S. oil imports, and it is the largest source of U.S. natural gas and electricity imports. Recognizing the importance of the energy trade between the two countries, both participate in the North American Energy Working Group, which seeks to improve energy integration and cooperation between Canada, the U.S., and Mexico.

Our emphasis. As an ally, free country, and dependable energy supplier, Canada is an essential contributor of U.S. energy security.

Some groups are dedicated to crippling that energy production — and U.S. energy use –  by demonizing petroleum produced from the Alberta oil sands. And, by making oil sands a bete noire, they hope to prevent development of similar U.S. energy resources such as shale oil. The anti-energy, anti-growth agenda will be on display this week when Canada’s prime minister, Stephen Harper, comes to Washington, D.C., for a meeting with President Obama.

From The Globe and Mail, “Oil sands under attack on environment“:

The environmental battle over Alberta’s oil sands is going global, forcing the industry to respond to new attacks on its record and putting fresh pressure on Ottawa.

The Calgary-based industry is accustomed to defending its image in North America, but it now faces a multifront war. That growing global opposition is highlighted by its role in today’s federal election in Norway, where the state-owned oil company’s plans for the oil sands have sparked controversy.

As well, a documentary that premiered in Switzerland and is now playing at the Toronto International Film Festival depicts the projects’ devastating environmental impact; and a delegation of Chinese journalists is planning a visit to the scarred landscape of northeastern Alberta.

At the same time, U.S. activists are continuing their attacks in Washington, scheduling a news conference this week ahead of Prime Minister Stephen Harper’s visit with President Barack Obama to highlight the dramatic increase in emissions that would occur if oil sands production is expanded as planned.

Along with tendentious documentaries, the latest tactic for attacking Canadian oil is the low-carbon fuel standard, which we wrote about here and here. As the industry alliance, Secure Our Fuels, explains, the standard attempts to shut out the U.S. No. 1 foreign supplier of energy:

Under an LCFS, if the oil isn’t “Jed Clampett” ready – that is, able to be produced without much time, talent or effort – it isn’t a form that’s treated kindly. And since so much of Canada’s oil resources are classified as “heavy,” very little of it will be eligible for shipment to U.S. markets – forcing American consumers to contract with foreign, unstable suppliers half-a-world away instead.

Exactly right. U.S. economic growth, our national prosperity, is going to require the use of petroleum for many decades to come. Putting one dependable supplier, Canada, off limits will raise the cost of energy, slow domestic economic growth, and at the same time make the U.S. more reliant on less secure suppliers like Venezuela and Middle Eastern countries. The opponents of Albertan oil sands know all this, and they mostly don’t care.

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Low-Carbon Fuel Standards Would Kill At Least One Refinery Project

It’s been three decades since a brand new oil refinery has been built in the United States due to regulatory restrictions, the power of NIMBY-inspired litigation, and already low margins for the refinery business. New domestic capacity has been added to existing refineries through upgrades and expansions, but it’s more common for companies to build new refineries outside the United States.

The brightest prospect for a new refinery has been in South Dakota, where the Dallas-based Hyperion Energy Company plans to build a $10 billion facility in Union County between Sioux Falls, S.D., and Sioux City, Iowa. That’s a lot of investment and jobs. As the PrairieBiz magazine reports, “During construction alone, Hyperion would employ approximately 4,500 workers in the four years that it will take to build. At full production, 1,800 full-time jobs would be available at the plant.”

But all for naught if Congress enacts a low-carbon fuels standard. As we wrote earlier in the week, supporters of the standard claim an environmental imperative, but the proposal would make the U.S. even more dependent on Middle Eastern or Venezuelan oil. And as for the Hyperion project (earlier posts here), the Sioux City Journal reports, “Industry group: Low carbon proposal threatens Hyperion refinery“:

New environmental regulations for transportation fuels being considered in Congress would deal a “devastating” blow to U.S. projects like the proposed Hyperion Energy Center in Union County, according to a coalition of business groups.

Some majority Democrats back legislation that would lower carbon emissions in U.S. vehicles. The so-called Low-Carbon Fuel Standards, or LCFS, would unfairly penalize heavier, dirtier oil such as the crude from the Alberta, Canadian oil sands that Hyperion plans to process.

Last month, Hyperion secured a state air quality permit for its $10 billion refinery, which would process of 400,000 barrels per day.

“No permit in the world is going to save this project if LCFS is put in place,” said Chris Tucker, a spokesman for the Consumer Energy Alliance, a 125-member group that includes oil companies, retailers, trucking and transportation groups and business organizations like the U.S. Chamber of Commerce.

The Consumer Energy Alliance (which the NAM is a member of) has launched a new website on the low-carbon standards at SecureOurFuels.com, which includes a blog.

Good site. Good jobs.

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Low-Carbon Fuels: Are We Serious About Energy Security or Not?

One of the many campaigns the environmentalist left has organized to cripple U.S. energy production and consumption is an attack against high-carbon fuels, i.e., fuels that are derived from heavy crude that requires additional refining. In the brave new world we live in, carbon is bad because it contributes to global warming/climate change/doom.

In simpler terms: The American greens hate the success of Canada’s oil sands and they want to prevent any similar development in the United States, including shale oil.

In California, the political means being applied is a low-carbon fuel standard dictated by Gov. Arnold Schwarzenegger and now being put into effect by the California Air Resource Board. (Details here.)

Legislation has also been introduced in Congress to disadvantage Canadian oil, H.R. 1787, the Low Carbon Fuel Standard Act, and S. 1095, America’s Low-Carbon Fuel Standard Act.

Just as some environmentalists seek to artificially limit U.S. access to Canadian (and Mexican and domestic oil, as the case may be), the Chinese are getting into the business.

From Don Martin, a columnist with The National Post, the nationwide Canadian newspaper, “China dives into oil sands as U. S. balks“:

To lift a quip from Prime Minister Stephen Harper’s Arctic sovereignty policy and apply it to the American view of Alberta’s oil sands: Use it or lose it.

The Chinese government pushed its shovel deep into Canada’s energy motherlode yesterday when it announced a $2-billion stake in a five-billion-barrel reserve of “dirty oil” that Americans increasingly find unworthy of fuelling their vehicles.

The 60% claim by Petro-China in two projects owned by Athabasca Oil Sands Corp., while small compared to the great gobs of capital pouring into oil sands expansion and extraction, are the global giant’s largest investment in Canadian energy yet.

And China usually buys into products it aims to consume.

Investor’s Business Daily comments editorially in “Shifting Sands,” noting, “We balk at importing ‘dirty’ oil from Canada, but others aren’t so reluctant. Exempt as a ‘developing’ nation from Kyoto-like agreements, China has decided to help Canada develop its energy-rich oil sands.” The Canadians, IBD reports, are already talking about a pipeline to bring Alberta oil to the West Coast so it can shipped via tanker to China.

It’s the producers’ oil to sell as they see fit, but it would be a policy mistake of the highest order for the United States to turn its back on its No. 1 oil supplier, a reliable supplier and solid U.S. ally, motivated only by dreams of a new “green” economy that bears little connection to reality. And if U.S. policymakers refuse Canadian oil sands, then they will logically have to refuse any future domestic energy from any U.S. shale or oil sand deposits.

To promote low-carbon fuel mandates is to reject U.S. energy security, plain and simple.

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A First-Hand View of the Alberta Oil Sands

From The Calgary Sun:

In what is billed a congressional investigative trip, two U.S. lawmakers will get a bird’s-eye view of Alberta’s oilsands today, a region which has lately been denigrated by mayors south of the border as well as Democratic presidential hopeful Barack Obama’s campaign.

But despite the recent spate of criticism, the two Democratic congressmen told the Sun crude from Alberta’s oilsands is vital to the energy security of their country.

“It’s critically important,” said Rick Boucher, a congressmen from Virginia who also chairs the subcommittee on energy and air quality. “We need that oil and we’re going to take whatever steps are necessary to make cure that we continue to have access to it.”

Boucher and Florida congressman Tim Mahoney were in Saskatchewan yesterday to visit the Weyburn carbon dioxide sequestration project. Today, they are touring the Alberta oilsands and meeting industry representatives in Calgary.

Congratulations to Reps. Boucher and Mahoney for their investigations, which show an appreciation of Canada’s role in addressing U.S. energy needs. Many Canadian officials and commentators were offended by the recent know-nothing, no-nothing resolution adopted by the U.S. Conference of Mayors condemning the use of “high-carbon” fuels such as the heavy oil from Canada.

Fortunately, Western governors are less reflexively anti-energy. From The Edmonton Journal, “Governors Cheer Oilsands.”

JACKSON HOLE, Wyoming – Alberta found some allies Sunday at a meeting of governors of western U.S. states, when a pair of lawmakers

defended the oilsands and suggested Canada continue to ramp up its output in the face of environmental concerns.

“I look forward to the day that we markedly increase the oilsands production,” said Montana Gov. Brian Schweitzer, a Democrat. “We have an energy crisis in this county and maybe the only reliable trading partner that we have in this country is my neighbours, my friends in Alberta.”

Boucher, Mahoney, Schweitzer — all Democrats. Very good to see the pro-energy caucus taking an active role in shaping policy.

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CBC, Depicting Something Else

Above is the Canadian Press photo that CBC used to illustrate a story, “Bakken Formation: Will it fuel Canada’s oil industry?

Couldn’t the editors find a photo of whalers processing blubber from a right whale?

The point being that the photo depicts the mining of Canadian oil sands, which has little to do with the drilling used to access the Bakken Shale formation. That process looks more like this:

(Minnesota Public Radio photo)

Just a guess, but we bet there’s a CBC editor or two who really dislike the Canadian oil sands and will find any reason at all to justify a photo. (Without mentioning reclamation.)

BTW, the CBC story itself is quite good. Saskatchewan, long a poor relative among the provinces, is a real growth story these days.

Production from the Bakken has been stupendous,” said Roy Schneider, spokesman for Saskatchewan Energy and Resources. “As recently as 2004, production was 278,540 barrels; last year, 2007, we were nudging up against five million barrels – the exact figure was 4,965,000 barrels.

 Hope our U.S. politicians don’t alienate the Canadian oil suppliers. We need that energy.

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Mayor Produce Oil, Water and 280 Pages of Resolutions

Forget questions of effective city administration, infrastructure or taxes, mayors just want to fix the environment!

First we have the silly finger-wagging about bottled water.

And now a resolution from the U.S. Conference of Mayors telling the Canadians just to keep their dirty, dirty oil.

As a Calgary Sun columnist notes, “Considering that by 2020, Alberta’s oilsands will pump four-million barrels of oil a day — about a quarter of total current U.S. oil consumption, it could prove challenging and costly for these high-minded local politicians to find a separate spigot that will deliver only non-oilsands based fuel to their vehicle fleets.”

The package of resolutions adopted at the Miami meeting of mayors runs for 280 pages! No wonder the mayors want to preserve the Canadian northern arboreal forests from the ravages of oil sands extraction. They need to pulp the trees for paper instead.

P.S. 280 pages!

(Hat tip: Glenn Reynolds.)

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Environmental Group Calls for Even More Expensive Gas

Even as gasoline heads toward an average $4 a gallon, an environmental group demands LESS petroleum supply. From the Houston Chronicle:

Refinery expansions in the U.S. focused on processing crude from Canadian oil sands show an entrenched reliance on fossil fuels even as concerns grow about the effects of oil sands production, an environmental group said Wednesday.

Such multibillion-dollar investments illustrate a long-term shift in refining toward so-called heavy oil, which requires more energy-intensive production and prompts worries about emissions and waste runoff, the report’s authors said.

“The first step is to start with awareness of what it means,” said Eric Schaeffer, a former Environmental Protection Agency lawyer who is director of the Washington-based Environmental Integrity Project, an advocacy group that produced the report.

“This is an intensely wasteful way to feed an oil habit,” Schaeffer said.

The group’s materials, including the report, are available here. No domestic drilling, no imports, no Canada…hey, and why are you driving, anyway?

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