Not Relevant: N o E nergy P lan for Canada

Not Relevant: Not Relevant: No o Energy nergy Plan for lan for CanadaCanada

June 19, 2007June 19, 2007

Gordon LaxerGordon Laxer – Parkland Institute – Parkland Institute

Part I: Alberta-style Political discoursePart I: Alberta-style Political discourse

Alberta new right: separatism vs take Alberta new right: separatism vs take over rest of Canadaover rest of Canada

2007 Leon Benoit (Conservative Mp, 2007 Leon Benoit (Conservative Mp, Vegreville Alberta) re my testimonyVegreville Alberta) re my testimony

1997/ 1999 Ralph Klein re Parkland1997/ 1999 Ralph Klein re Parkland

Tory MPs storm out of meeting on Tory MPs storm out of meeting on energy sharingenergy sharing

Amid heated charges of a coverup, Tory Amid heated charges of a coverup, Tory MPs on Thursday abruptly shut down MPs on Thursday abruptly shut down parliamentary hearings on a controversial parliamentary hearings on a controversial plan to further integrate Canada & the plan to further integrate Canada & the U.S. U.S.

The firestorm erupted within minutes of The firestorm erupted within minutes of testimony by University of Alberta testimony by University of Alberta professor Gordon Laxer that Canadians professor Gordon Laxer that Canadians will be left "to freeze in the dark" if the will be left "to freeze in the dark" if the government forges ahead with plans to government forges ahead with plans to integrate energy supplies across North integrate energy supplies across North America.America.

Ottawa Citizen (A3; Ed Journal A6; Montreal Gazette A 12)Ottawa Citizen (A3; Ed Journal A6; Montreal Gazette A 12)

Fallout from Benoit’s mode of political Fallout from Benoit’s mode of political discoursediscourse

Sparked interest in what I said to cause Benoit’s tantrum My Op eds:

Calgary Herald + Calgary Herald + Edmonton JournalEdmonton Journal published my testimony May 16

‘‘Manifesto infuriates Tories’; Manifesto infuriates Tories’; ‘‘Canada's energy Canada's energy needs come first’needs come first’

Globe & Mail op ed Globe & Mail op ed ‘Easterners could freeze in the dark’ ’ The U.S. has a national energy policy.. Why don't we?The U.S. has a national energy policy.. Why don't we?

Two positive editorials Lethbridge Herald and stories in Two positive editorials Lethbridge Herald and stories in Halifax Chronicle & Peterborough ExaminerHalifax Chronicle & Peterborough Examiner

Parkland Institute: A BriefParkland Institute: A Brief

Fallout from Klein’s mode of Fallout from Klein’s mode of discoursediscourse

13,000 copies of 13,000 copies of Shredding the Public InterestShredding the Public Interest sold in 6 weeks in Alberta – during 1997 prov’l sold in 6 weeks in Alberta – during 1997 prov’l electionelection

Conservs won zero seats in Edmonton area Conservs won zero seats in Edmonton area constituencies where the book had biggest constituencies where the book had biggest impactimpact

‘‘The book turned the election in Edmonton. In The book turned the election in Edmonton. In another month it would have turned the another month it would have turned the province’. province’. Dave King, Education Min. Lougheed govtDave King, Education Min. Lougheed govt

Part IIPart II Canada promises oil security for USCanada promises oil security for US

George W. Bush can count on a secure flow of oil George W. Bush can count on a secure flow of oil & gas from its biggest energy supplier & trading & gas from its biggest energy supplier & trading partner – Canadapartner – Canada

Stephen HarperStephen Harper

““Alberta supports the goals of energy Alberta supports the goals of energy integration right through to Central America integration right through to Central America and the Caribbean.”and the Caribbean.”

Premier KleinPremier Klein

WashingtonWashington June June 20062006

Energy Superpower or Resource Energy Superpower or Resource Satellite?Satellite?

““Canada is new ‘emerging energy Canada is new ‘emerging energy superpower’, & secure source of almost superpower’, & secure source of almost limitless energy resources” S. Harperlimitless energy resources” S. Harper

Superpowers can can influence events by influence events by projecting eprojecting economic, military, political & conomic, military, political & cultural power cultural power on world scaleon world scale

Satellites are formally independent are formally independent countries, dominated countries, dominated through deep through deep ideological allegiance, & econ. ideological allegiance, & econ. dependence dependence on more powerful countryon more powerful country

Broad SPP AgendaBroad SPP Agenda

Energy is major plank in broader agenda to Energy is major plank in broader agenda to integrate Canada & Mex into a Greater America. integrate Canada & Mex into a Greater America.

End point of Deep Integration? Puerto Rican End point of Deep Integration? Puerto Rican status for Canada & Mexico – any takers?status for Canada & Mexico – any takers?

Trade off: Canada and Mexico adopt Bush Trade off: Canada and Mexico adopt Bush regime’s ‘security agenda’. In return they get regime’s ‘security agenda’. In return they get privileged but not guaranteed access to US privileged but not guaranteed access to US market.market.

Energy & SPPEnergy & SPP

Bush plan energy security predates S11Bush plan energy security predates S11

US NEP Report [Cheney Policy Grp] US NEP Report [Cheney Policy Grp] May May

20012001 [self-sufficiency, oil indep, domestic ownership][self-sufficiency, oil indep, domestic ownership]

North American Energy Working Grp Apr North American Energy Working Grp Apr 2001. 2001. Set up by energy ministers US, Canada, Set up by energy ministers US, Canada, Mexico – under the radarMexico – under the radar

Later Folded in as 1 of SPP working grpsLater Folded in as 1 of SPP working grps

With NAFTA, Canada lost control over:With NAFTA, Canada lost control over:

** energy energy exportsexports to US: to US: proportionality proportionality clauseclause

Thus, Canada lost Thus, Canada lost control over GHG emitscontrol over GHG emits

SecuritySecurity of Supply to Eastern Canadians of Supply to Eastern Canadians

Foreign ownership Foreign ownership / control/ control

Price Cdns pay to buy own energyPrice Cdns pay to buy own energy

Satellites lose control energy / enviro futureSatellites lose control energy / enviro future

What more can US win on Energy?What more can US win on Energy?

SPP - Secretive & murky processSPP - Secretive & murky process Big prize: Get Mexico abandon energy Big prize: Get Mexico abandon energy

nationalismnationalism

Canada: US already unltd access Cdn energyCanada: US already unltd access Cdn energyGet Cdns think North American rather than CdnGet Cdns think North American rather than Cdn

• More oil pipelines to USMore oil pipelines to US• Boost tarsands output – 5 mil b/dBoost tarsands output – 5 mil b/d• Ease Cdn enviro reguls energy projectsEase Cdn enviro reguls energy projects• LNG terminals to export to USLNG terminals to export to US• Temp Mex workers w/o immigs rightsTemp Mex workers w/o immigs rights

Canada’s New NEPCanada’s New NEP NEB’s mandate: "promote safety & NEB’s mandate: "promote safety &

security .. in Canadian public interest“security .. in Canadian public interest“ "Unfortunately, the NEB has not "Unfortunately, the NEB has not

undertaken any studies on security of undertaken any studies on security of supply."supply." email to me Apr 12, 2007email to me Apr 12, 2007

1980 National Energy Program:1980 National Energy Program:

Canadianization, self-sufficiency & Canadianization, self-sufficiency & security, 2-price oil policy, assert fed’l security, 2-price oil policy, assert fed’l powerpower

New NEP: No Energy PlanNew NEP: No Energy Plan

Alberta Govt & No Energy PolicyAlberta Govt & No Energy Policy

Guarantee U.S. Guarantee U.S. unlimited accessunlimited access Cdn oil, gas Cdn oil, gas

Defy KyotoDefy Kyoto convention on GHGs. convention on GHGs. 1% 1% royalty holiday royalty holiday on tarsands til capital on tarsands til capital

costs paid off: as low as costs paid off: as low as 25 cents per barrel per barrel

Encourage Encourage foreign ownershipforeign ownership / control / control

‘‘In all my yrs as Premier of Alberta, I never once In all my yrs as Premier of Alberta, I never once heard anyone … articulate a compelling vision heard anyone … articulate a compelling vision of Canada’s continental energy future’. of Canada’s continental energy future’.

Ralph Klein - quoted in Fraser Inst fundraiserRalph Klein - quoted in Fraser Inst fundraiser

Comparing Energy Resource Comparing Energy Resource Savings FundsSavings Funds

Alberta’s Heritage FundAlberta’s Heritage Fund: : $14.8 billion US$14.8 billion US DecDec 2006. Started 1976 2006. Started 1976

Alaska’s Permanent FundAlaska’s Permanent Fund: : 39 b US39 b US May ‘07 May ‘07Started 1977Started 1977

Norway’s Petroleum FundNorway’s Petroleum Fund: : 293293 b US b US (2006)(2006)

Started putting funds into account – 1996Started putting funds into account – 1996

(Norway’s Petroleum Fund now merged with Pension fund(Norway’s Petroleum Fund now merged with Pension fund))

Part III Energy Insecurity Eastern CdnsPart III Energy Insecurity Eastern Cdns

““Let the Eastern Bastards Freeze in the Dark” Let the Eastern Bastards Freeze in the Dark” popular Alberta bumper sticker in early 1980s is popular Alberta bumper sticker in early 1980s is now Canada’s default policynow Canada’s default policy

Oil Imports:Oil Imports: Supply 90% oil Atlantic provs & QuebecSupply 90% oil Atlantic provs & Quebec 40% of Ontario 40% of Ontario Canada NO strategic petroleum reserve & no Canada NO strategic petroleum reserve & no

studies / plans for internat’l oil supply crisisstudies / plans for internat’l oil supply crisis

Exports to US:Exports to US:63%63% of Canada’s oil production of Canada’s oil production56%56% Canada’s nat. gas Canada’s nat. gas

Canadian oil imports by sourceCanadian oil imports by source

Year / importsYear / importsBarrels per dayBarrels per day

OPECOPEC North SeaNorth Sea

20042004

960,000 b/day960,000 b/day41.3%41.3%Algeria 14.6%Algeria 14.6%

S Arabia 8.1%S Arabia 8.1%

Iraq 7.8%Iraq 7.8%

47.5%47.5%Norway 26.9% Norway 26.9%

UK 20.6%UK 20.6%

20052005



Iraq 7.1%Iraq 7.1%

41.7%41.7%Norway 26.0%Norway 26.0%

UK 15.7%UK 15.7%

20062006


Iraq 8.1%Iraq 8.1%


37.0%37.0%Norway 21.7%Norway 21.7%

UK 15.3%UK 15.3%

Oil Pipelines Canada 2006Oil Pipelines Canada 2006source NEB 26 / 11 / 06source NEB 26 / 11 / 06

Enbridge PipelinesEnbridge Pipelineshttp://library.enbridge.com/users/folder.asp?FolderID=1667http://library.enbridge.com/users/folder.asp?FolderID=1667

Interprovincial Enbridge Oil Pipeline Interprovincial Enbridge Oil Pipeline from Western Canadafrom Western Canada

Can move 1.9 mil b. / day to US midwest & OntCan move 1.9 mil b. / day to US midwest & Ont This sufficient to supply On, Que, Atlantic provsThis sufficient to supply On, Que, Atlantic provs

150,000 b/day of unused capacity 2005150,000 b/day of unused capacity 2005

Vulnerable to US pressure because routed Vulnerable to US pressure because routed through Wisconsin & Michigan to Sarnia through Wisconsin & Michigan to Sarnia

Nat gas pipeline to Quebec city: all-Cdn routeNat gas pipeline to Quebec city: all-Cdn route

Source CAPP Pipeline Expansion Feb 2005Source CAPP Pipeline Expansion Feb 2005

Sarnia to Montreal PipelineSarnia to Montreal Pipeline

1950s Debate: nat’l vs continental view1950s Debate: nat’l vs continental view Built 1978 to bring western oil to Built 1978 to bring western oil to

Montreal. 250,000 b/day capacity.Montreal. 250,000 b/day capacity. Part of Trudeau govt’s plan for energy Part of Trudeau govt’s plan for energy

self-sufficiency & independenceself-sufficiency & independence Reduced Cdn imports from 50% to 29%Reduced Cdn imports from 50% to 29%

1999 Pipeline reversed bring offshore oil 1999 Pipeline reversed bring offshore oil from Portland Me thru Montreal to Sarniafrom Portland Me thru Montreal to Sarnia

Enbridge Forecast Decline Imports Enbridge Forecast Decline Imports on Mtl to Sarnia lineon Mtl to Sarnia line

source: Enbridge Pipeline App 11Ap 07source: Enbridge Pipeline App 11Ap 07

YearYear 20042004 20052005 20062006 20082008 20102010 20122012 20132013

000000

b/ b/ dayday

227227 190190 141141 118118 9696 5050 00

Campaign Demand: reverse Sarnia Campaign Demand: reverse Sarnia to Montreal pipelineto Montreal pipeline

Decline in offshore imports thru Decline in offshore imports thru pipeline makes demand for pipeline makes demand for Energy security easierEnergy security easier

Strategic Petroleum Reserve [SPR] for Strategic Petroleum Reserve [SPR] for CanadaCanada

SPRs are IEA requirement for all members. Only SPRs are IEA requirement for all members. Only exception are 4 net oil importing states:exception are 4 net oil importing states:Canada, Denmark, Norway, U.K.Canada, Denmark, Norway, U.K.

Denmark & U.K. have SPRs as membs EUDenmark & U.K. have SPRs as membs EU

Norway supplies almost all domestic market Norway supplies almost all domestic market before exportingbefore exporting

IEA assumption: countries supply domestic IEA assumption: countries supply domestic market before exporting - market before exporting - not work for not work for CanadaCanada

Long term SecurityLong term Security

SPRs only useful for short term energy SPRs only useful for short term energy supply crisis – 90 days supplysupply crisis – 90 days supply

For long term security:For long term security: Bring back 25 year rule: No energy Bring back 25 year rule: No energy

exports unless 25 yrs exports unless 25 yrs provenproven supply for supply for CdnsCdns

Build all Cdn oil pipeline to MontrealBuild all Cdn oil pipeline to Montreal Get Mexican exemption on NAFTA’s Get Mexican exemption on NAFTA’s

Proportionality clauseProportionality clause

Part IV Energy Security & Climate Part IV Energy Security & Climate ChangeChange

Exit NAFTAs proportionality clauseExit NAFTAs proportionality clause

Cap / slow tarsands productionCap / slow tarsands production

Alternative VisionAlternative Vision

Exiting NAFTA Proportionality Clause & Exiting NAFTA Proportionality Clause & Greenhouse gasesGreenhouse gases

Obstacle to Green policy CanadaObstacle to Green policy Canada

Won’t convince Cdns to drastically cut Won’t convince Cdns to drastically cut energy use, if Canada just exports moreenergy use, if Canada just exports more

NAFTAs proportionality clause means NAFTAs proportionality clause means Canada’s GHG emissions likely remain Canada’s GHG emissions likely remain high, even with lower Cdn consumptionhigh, even with lower Cdn consumption

Why exit NAFTA proportionality clause?Why exit NAFTA proportionality clause?

US Gov’t now says: ‘security US Gov’t now says: ‘security trumps trade’trumps trade’

If soIf so, energy security for , energy security for Canadians trumps Canadians trumps NAFTANAFTA

Exiting Proportionality / NAFTAExiting Proportionality / NAFTA

1.1.Mexican ExemptionMexican Exemption. Proportionality – the only . Proportionality – the only NAFTA energy clause exempting Mexico NAFTA energy clause exempting Mexico

John DillonJohn Dillon

Chrétien Liberals’ 1993 fed. election promise: Chrétien Liberals’ 1993 fed. election promise: “Liberal govt will renegotiate both FTA & NAFTA “Liberal govt will renegotiate both FTA & NAFTA to obtain … same energy protection as Mexico.”to obtain … same energy protection as Mexico.”

2.2.Withdraw Withdraw NAFTA. A party may withdraw in NAFTA. A party may withdraw in six six monthsmonths after giving written notice after giving written notice NAFTA NAFTA Article 2205Article 2205

Natural Gas & Tarsands OilNatural Gas & Tarsands Oil

Conventional nat gasConventional nat gas: : 8.7 years8.7 years left of left of ‘proven’‘proven’ reserves reserves [Stats Canada][Stats Canada]

Canada: only 1% of world’s nat. gasCanada: only 1% of world’s nat. gas By 2018, TarSands reach 3 m. b/d oilBy 2018, TarSands reach 3 m. b/d oil 2006-2018: tarsands require 2006-2018: tarsands require 12 Tcf12 Tcf gas gas AB Gas Preserv’n Act: AB set aside 15 yrs AB Gas Preserv’n Act: AB set aside 15 yrs

usage before exportsusage before exports

– – Kjell Aleklett ‘Crash programme’ p. 1939Kjell Aleklett ‘Crash programme’ p. 1939

Natural Gas & TarSandsNatural Gas & TarSands

Surface mining: Surface mining: 750 cu ft750 cu ft nat gas nat gas produce 1 barrel oil (153 litres)produce 1 barrel oil (153 litres)

In Situ (deep) In Situ (deep) 1500 cu ft1500 cu ft nat’l gas to nat’l gas to produce 1 barrel oilproduce 1 barrel oil

15001500 cu ft gas enough to heat a Cdn cu ft gas enough to heat a Cdn home for about home for about 8 days8 days

By 2012, TarSands need 2 b. cu ft / day: By 2012, TarSands need 2 b. cu ft / day: enough to heat all Cdn homes for dayenough to heat all Cdn homes for day

1.5 X the nat. gas from Mack Valley Pipe1.5 X the nat. gas from Mack Valley PipeSource: ‘Oil Sands Fever’. Pembina 2005Source: ‘Oil Sands Fever’. Pembina 2005

Green House Gases & ExportsGreen House Gases & Exports

TarsandsTarsands: single largest GHG source Canada: single largest GHG source Canada2000: 23 m. tonnes GHGs2000: 23 m. tonnes GHGs2015: 57-97 m. tonnes GHGs – 2015: 57-97 m. tonnes GHGs – Sierra Club Prairie chaptSierra Club Prairie chapt

GHG intensity GHG intensity almostalmost 3 times conventional oil 3 times conventional oil

By 2015: By 2015: ¾¾ Cdn oil production from tar sands Cdn oil production from tar sands CAPPCAPP

75% tar sands oil exported to US now 75% tar sands oil exported to US now

2-5 barrels water for each barrel oil2-5 barrels water for each barrel oil

Nuclear : Green Alternative?Nuclear : Green Alternative?

Nat’l gas short-term solution to rising Nat’l gas short-term solution to rising tarsands productiontarsands production

growing nuclear lobbygrowing nuclear lobby Nuclear power would take >10 yrs startNuclear power would take >10 yrs start Nuclear not carbon neutral: lots of CO2 Nuclear not carbon neutral: lots of CO2

refining uraniumrefining uranium Dangers: nuclear waste disposal, Dangers: nuclear waste disposal,

accidents: Chernobyl in Alberta anyone?accidents: Chernobyl in Alberta anyone?

Source: Kjell Aleklett et al, 2007Source: Kjell Aleklett et al, 2007

Part IV New geopolitics of OilPart IV New geopolitics of Oil

Oil & US military machineOil & US military machine

** Control over oil central to popular sovereignty Control over oil central to popular sovereignty struggles vs U.S. Empirestruggles vs U.S. Empire

How did ‘their’ oil get under Iraqi sands & How did ‘their’ oil get under Iraqi sands & Alberta’s Tar sands?Alberta’s Tar sands?

PentagonPentagon is world’s single largest buyer of oil, is world’s single largest buyer of oil, consumes 85% US Gov’t oil useconsumes 85% US Gov’t oil use

Cdn oil : Cdn oil : U.S.’s # 1 source oil importsU.S.’s # 1 source oil imports

Thus Canada major fueler U.S. war machineThus Canada major fueler U.S. war machine

Govt control oil & gas – new realityGovt control oil & gas – new reality

““Governments and the national oil Governments and the national oil companies are obviously in control of companies are obviously in control of about 90% of the assets”. about 90% of the assets”.

““Oil remains fundamentally a government Oil remains fundamentally a government business”business”

Dick Cheney 1999, when Pres. HalliburtonDick Cheney 1999, when Pres. Halliburton

[Oil fields engineering corp][Oil fields engineering corp]

Lack Investment Opportunities Private Oil Lack Investment Opportunities Private Oil CompaniesCompanies

Robin West:Robin West: ““national oil companies national oil companies

now control over 80% of now control over 80% of the resources” the resources”

““the industry can't invest. the industry can't invest. It can't develop the excess It can't develop the excess capacity, because most of capacity, because most of

the resources are off-limitsthe resources are off-limits to investment”to investment”

Robin West. CEO PFC energy. Robin West. CEO PFC energy.

Planning services oil industryPlanning services oil industry

Panacea or Pipe Dream? Energy Policy and the Search for Alternatives: Session I: A Foreign Policy Mandate: Thirty Years of Oil And Gas.

Council on Foreign Relations, Washington D.C., March 13, 2007. Thanks Keith Newman

National Oil CompaniesNational Oil Companies::

The The New Seven Sisters of OilNew Seven Sisters of Oil

Source: Carola Hoyos, Financial Times, March 11 2007; The new Seven Sisters: oil and gas giants dwarf western rivals.

(http://www.ft.com/cms/s/471ae1b8-d001-11db-94cb-000b5df10621.html). Thanks Keith Newman

Alternative VisionAlternative Vision

Canada firstCanada first. 25 yrs ‘proven’ oil / gas supplies . 25 yrs ‘proven’ oil / gas supplies for Cdns before exportingfor Cdns before exporting

Halt Halt NEW tar sands projectsNEW tar sands projects

Substantially lower consumption Substantially lower consumption insteadinstead

Meet Meet Canada’s 2012Canada’s 2012 Kyoto Kyoto targets & then targets & then much deepermuch deeper cuts cuts

Raise royalties forRaise royalties for prov’l, indigenous owners prov’l, indigenous owners

Halt TarsandsHalt Tarsands Halt new projects Halt new projects til meet tough til meet tough

standardsstandards: : Strict limit water / GHG emissionsStrict limit water / GHG emissions Realistic land reclamation plansRealistic land reclamation plans Deposit cover full-cost land reclamation Deposit cover full-cost land reclamation

up-frontup-front No subsidies production dirty energyNo subsidies production dirty energy Energy security for CdnsEnergy security for Cdns Much higher econ rents on dirty energy to Much higher econ rents on dirty energy to

fund clean energy industry AB & CANfund clean energy industry AB & CAN

Public Ownership / Social OwnershipPublic Ownership / Social Ownership

National Oil Companies control 77% world’s reserves [Warnock]

Location commitment & conserving purposes

73% Cdns support pub. ownership PetroCanada 2004 [Ipsos Reid]

51% Cdns support govt ‘nationalizing’ oil companies in Canada 2005 [Leger Polling]

34% Albertans support above [Leger]

Fed, prov, municip crown energy corps Encourage coops / social ownership

Bolivia nationalizes gas industryBolivia nationalizes gas industry

May 2006 / Mai 2006

Source: La Razon Newspaper, Bolivia, http:www.la-razon.comversiones2006050_005529nota_244_281969.htm

Actions for ActivistsActions for Activists a) Campaigns to Stop new export

pipelines, LNG terminals, tarsands expansion

b) Protest Bush / Harper / Calderon SPP summit – Aug 21-2

c) Talk Greens exiting proportionalityd) Public / Media: research reports /

books, op. eds, demos, letters editor etc e) Lobby pol. Parties: fed’l, prov’l, terr.f) Set up information exchange networks

www.ualberta.ca/parkland

Documents

Not Relevant: N o E nergy P lan for Canada