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Government promise to restrict bitumen exports falls by wayside
News Articles Featured | Vancouver Sun | September 07, 2011
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OTTAWA — The Harper government has quietly buried a controversial promise to ban bitumen exports to countries that are environmental laggards, as Alberta and the energy industry formalize plans to ship oilsands product to lucrative Asian markets.
One person familiar with Prime Minister Stephen Harper's surprise announcement during the 2008 federal election campaign said the pledge was simply electioneering at the time and was to be "buried and never seen again."
Alberta's energy minister also wonders whether the campaign promise is even a government policy any longer, noting the issue has never been discussed with him during his two years in the portfolio.
However, a spokeswoman for federal Natural Resources Minister Joe Oliver said Wednesday the government policy — designed to halt the flow of raw bitumen and jobs overseas — remains in place but is being regularly examined.
"Our 2008 platform commitment remains in effect. We continue to review on an ongoing basis," said Julie Di Mambro, press secretary to Oliver.
As criticism mounts in the United States over oilsands development — and the potential for additional shipment stateside via the Keystone XL pipeline — Canadian politicians and energy companies have increasingly been eyeing emerging markets like China, India and Korea.
Space has already been fully booked on Enbridge Inc.'s proposed $5.5-billion Northern Gateway pipeline, potentially linking Alberta's oilsands to energy-hungry Asia-Pacific countries.
The line would carry raw bitumen or upgraded synthetic crude 1,170 kilometres from northern Alberta to the port of Kitimat, B.C. The project remains under review by the National Energy Board and could be operational by 2016.
Di Mambro noted the federal government has referred the Northern Gateway project to a joint review panel that's consulting with Canadians.
"We await the recommendations of this panel and remain committed to ensuring that any project is environmentally sustainable," she added.
However, plans for the pipeline to ship oilsands product to the West Coast, and then by supertanker to Asia, seemingly conflict with the prime minister's three-year-old promise.
In September 2008, Harper announced during a Calgary campaign stop his government would halt the flow of oilsands products and jobs to countries with greenhouse-gas emission standards weaker than Canada's.
"This is the right thing to do for our environment and our economy," Harper said at the time.
The Conservative policy — which was, at the time, to apply to bitumen exports to China — was to take effect in January 2010 and apply to new export deals and not impact existing contracts.
But barely a word has been heard of it since, as billions of dollars of Asian investment flood into Canada's petroleum sector and the federal Tories continue to mend what were once threadbare relations with China.
At the same time, companies on both sides of the Pacific Ocean have combined to pledge billions to build the Northern Gateway pipeline and premiers trumpet the need to feed Asia's insatiable energy appetite.
"That may not even be a policy of the federal government any longer," said Alberta Energy Minister Ron Liepert, who notes the federal Conservatives have been very supportive of opening up Asia-Pacific markets.
"It's something, that in the two years I've been in the ministry, hasn't been mentioned to me."
Canada currently produces approximately 2.9 million barrels of oil per day, with about 1.6 million barrels of it coming from the oilsands.
The United States is currently Canada's only bitumen customer, with roughly one million barrels of oilsands product (diluted bitumen and synthetic crude) exported each day to the U.S.
But American environmental groups — aided by some political and celebrity star power, and two weeks of protests outside the White House — have been ratcheting up their attacks on the oilsands in recent months. They've been urging President Barack Obama to block construction of the Keystone XL pipeline, which would carry up to 900,000 barrels of oil per day from Hardisty, Alta. to refineries in Texas.
However, the U.S. State Department recently released a final environmental impact study on Keystone XL that found the pipeline would have no significant impact on natural resources on its route.
Politicians in Canada point to the oilsands protests in the U.S. as more reason to build Enbridge's Northern Gateway project, increase pipeline capacity to the coast and look for new customers.
Officials with Enbridge said they've heard nothing from the Harper government about the promise and don't expect it will impede shipping oilsands product to new markets.
"It's certainly not an issue that has been raised with us," said company spokesman Paul Stanway. "It's not on our radar at the moment."
Gil McGowan, president of the Alberta Federation of Labour, which has been fighting for the federal and provincial governments to keep oilsands value-added jobs in Canada, said he never expected the federal Tories to hold to their pledge.
"When the promise was made, we thought it had more to do with politics than real policy," McGowan said. "It was a reaction to the climate of the day . . . I'm not surprised to see very little is being done to see that policy becomes reality."
Tagged with: pipeline, canada, enbridge, northern gateway, bitumen, harper, asia, ron liepert, joe oliver
