Into a Black Hole: Tar Sands and Oil Production in Western Canada

Macdonald Stainsby

When I moved from British Columbia to Alberta recently, I discovered that the political realities of one province are largely unknown to those living in the other. In BC, oil is seen as a scheme hatched by mad cowboys that has little effect on the mountainous peace of the West coast. Similarly, when people speak of the Olympics in Alberta, it’s still in reference to the Calgary Games of 1988 – a stark contrast to BC, where the coming 2010 Winter Games are associated with rapidly increasing property values and social dislocation. Despite these differences, the economies of both provinces are said to be “booming.” The Albertan economy is growing faster than that of any other North American state or province, while BC is in the middle of a significant economic upswing. While sharp differences in political consciousness remain, especially at the local level, both BC Premier Gordon Campbell and Alberta Premier Edward Stelmach are supporting policy initiatives aimed at reconciling the political and economic differences between their provinces.

Following the demise of the North American anti-globalization movement after 9-11, the negotiation of trade and security agreements has accelerated in more localized contexts. The recent “Trade, Investment and Labour Mobility Agreement” (TILMA) between BC and Alberta is a piece of legislation that reflects this new trend. Once locked in after its “phase-in” period (set for completion in April 2009), TILMA will set minimum across-the- board standards for every jurisdiction within the outlined regions. Purportedly, the agreement will eliminate the discrepancies workers face in getting the licensing required to practice a given trade or profession. And, of course, the harmonization is being presented as having equal benefits for those who labour on, invest in, or manage the coming “giga-projects” in the tar sands.

Introduced in April 2007, the TILMA agreement was sold as a proposal to “break down barriers to trade” and give Alberta and BC a “competitive” tool to deal with Ontario’s vast economic advantage. In reality, TILMA turns BC and Alberta into a large deregulated zone, a place where corporations and individuals can sue over barriers that regulate or restrict investment. Because the agreement seeks to eliminate regulations that might “impact or impair” profit making, individual investors can now sue governments to remove impediments to growth, inlcuding public policies, and receive compensation for potential loss of revenue.

When considered from the standpoint of capital, nearly anything can be seen as an impediment to trade and investment. The language of TILMA intensifies the deregulation enabled by the North American Free Trade Agreement (NAFTA). NAFTA allows for “challenges” and third-party rulings on “disputes” about regulation – a situation which now sees Canada paying to maintain legislation around tobacco and the environment. TILMA pushes the project one step further. Prioritizing the rights of investors over democratic process, even municipal regulations are potentially open to legal challenge. Unlike the resolution process outlined in Chapter 11 of NAFTA, the current TILMA agreement includes an automatic penalty of up to $5 million for any municipal or provincial government that violates the rules of “free access” for capital. If, for example, a city were to block the construction of a building for heritage or environmental reasons, the corporation could sue the city for its projected loss of projected profits. TILMA turns NAFTA’s Chapter 11 into a sacrament.

Peak Oil

TILMA needs to be placed in the context of the global US hunt for energy resources. As C.L. Cook has argued in the P eace, Earth and Justice N ews, TILMA requires the subordination of local needs to international energy demands.1 For instance, in Kettle Valley, BC, most residents are opposed to poisonous radioactive mining in their backyards. However, they have little political recourse to stop the mining. According to Cook, “Barite is used to lubricate oil and gas rig drills, something infinitely more important to the well-being of Gordon Campbell’s good friends in the mining community than the health of Kettle Valley villagers.” TILMA is only the latest in a series of unaccountable agreements that coincide with the single largest energy policy shift in North America since US domestic oil production peaked in 1971.

Since September 11, 2001, the United States has sought to militarily, politically, and economically control the remaining conventional oil reserves which are also approaching their production peak. From gas pipelines running from Afghanistan to Europe to the assault on Iraq, from threats on Iran and Venezuela to the super-exploitation of African countries like Somalia and Nigeria, the US administration is looking to extend the life of its petroleum-based energy economy. Although Canada is often seen as a junior partner in many imperial ventures, it has taken the lead in the subjugation of the people of Afghanistan and Haiti. Perhaps more significant, if less well known, is Canada’s role in subordinating the planet to the needs of the oil and gas industry.

Having failed to pacify Iraq and having engendered new regional opposition in Africa, South America, and the Middle East, the US empire has driven oil prices to new heights – a trend which will continue into the future. Though peak oil has profound implications for the US dollar and the militarized global economy, these price rises have, in the short-term, been masterfully recast as US imperialism’s latest and greatest asset: the creation of massive new oil “reserves” in a politically friendly region which can feed the US domestic oil market.

Price rises have created a cushion for investors who want to produce “mock” oil and in the process destroy an area the size of Florida in the Athabasca, Peace, and Cold Lake regions of Alberta. Setting its sights on this area, the US has re-organized their long-term plans for petroleum. In the not so distant future, they hope to extract up to 25 percent of their daily oil needs from tar sands-based operations in the region, a plan that will involve building massive pipelines across unceded indigenous territory in BC, the North West Territories, and beyond. Undertaking this project involves more than mining the sand for tar to make mock oil. It means undertaking the largest industrial project in human history. Thanks to TILMA, labour regulations have been gutted across Alberta and BC. And thanks to the Security and Prosperity Partnership (SPP), massive new highway corridors from Mexico have been proposed to import tens of thousands of “guest labourers.”

The tar sands mega-project will see up to five million barrels of tar sands oil a day heading almost exclusively toward the US with little or no regulation. Under the proportionality clause of NAFTA, if 85% of Canadian energy produced is exported to the US, then from that point on 85% of the energy that Canada produces must by law continue to go the US. This will have staggering environmental implications and will result in the erosion of labour standards and unionization rates by increasing the vast numbers of “guest labourers” who cannot apply to become landed immigrants, let alone citizens. How will the North American ruling class streamline this operation? With the deployment of another nearly secret “trade” agreement, a “NAFTA on steroids,” if you will – the Security and Prosperity Partnership for North America. Designed to further enhance trade and prosperity within North America, the SPP will provide the tar sands project with the energy and labour needed for maximum production with little concern for environmental and human rights.

Just Add Water

If TILMA represents a race to the bottom for environmental standards, it is important to consider the extent to which the plunder of the tar sands has already caused massive environmental degradation. Although corporations must currently go through an application process before they can set up shop, so far no major tar sands operation has come under serious scrutiny by the Alberta Energy and Utilities Board. Current legislation already makes it relatively easy for companies to apply and attain state approval for tar sands development. The most recent application for development is Imperial Oil’s proposed Kearl Project located north of the community of Fort MacKay. One of the alarming features of this application is its proposal to completely annihilate the Muskeg River. One is left curious: Will Albian Sands – a Shell subsidiary – rename its “Muskeg River Mine”? More important, however, is that when it comes to policy around the tar sands north of “Fort Muck” water is no match for (mock) oil.

Also at risk is the much larger Athabasca River – one of the great waterways feeding into the Arctic Ocean. Its headwaters lie south of the small resort town of Jasper in the Rocky Mountains. Providing what early Canadian colonialists would use as a natural border line for large sections of Treaty 8 right up to the Northwest Territories, the Athabasca River watershed heads mostly eastward until it reaches the Lesser Slave Lake region, where it turns northbefore disappearing into Athabasca Lake, the eighth largest body of fresh water in Canada. This lake collects water from several rivers (including the Peace River from northern BC) before the Slave River heads north to Great Slave Lake, providing 40% of the legendary “Mackenzie River” – properly called the Deh Cho – where it extends through its delta into the Arctic Ocean.

Today, most of the tar sands extraction occurs in the Athabasca region. Both the vast strip mining tar pits and the “in situ” – or in the ground – steam-assisted gravity drainage (Sag-D) systems use an approximate average of four barrels of water to produce one barrel of crude oil. Some quick math: If 1.4 million barrels of tar sands crude are currently being produced every day, then that means a daily drawing of 5.6 million barrels of water on average from the river systems. This number will increase as production rises. With the help of TILMA and the SPP, the US Department of Energy and major energy corporations are demanding production increases of up to 5 million barrels of mock oil a day. That means the Athabasca River will be expected to give up 20 million barrels of water on every single calendar day. Not only that, but they will have to find a permanent storage facility for the many millions of barrels of contaminated water – up to 40% of what is taken out – that can never be safely returned to the rivers.

According to residents of the communities along the watershed, the Athabasca River has already seen water levels drop by more than three meters. More critical, however, is the problem of dealing with the huge volumes of water contaminated by the process that separates earth from tar. These giant lakes of non-recoverable toxic water are growing quickly, and the current plans would create one the size of Lake Ontario. The largest human-made dam structure in the world is not the Chinese Three Gorges dam, but the one built in Alberta by Syncrude to hold back waste from its strip mining operations. For its part, Suncor, a company involved in tar sands operations since the 1960s, has colonized a river island (named Tar Island) near their pilot plant south of Fort MacKay and turned it into a walled-in holding pen for tar sands waste water. As the waste accumulates, dikes are built ever higher to keep it contained. Today, the walls of the structure are said to be leeching toxic waste into the river system. Should these barriers break, the toxic waste water would cause massive devastation throughout the watershed, threatening all manner of life all the way to the Arctic Ocean.2

Although a poisoned watershed has been contemplated as a future possibility, in Fort Chipewyan – the oldest settlement in Alberta – it is already a reality. Fort Chipewyan is an isolated summer community of Mikisew Cree and “Chipewyan” Dene with about 1200 residents. For years, the community has been experiencing an increased incidence of cancers, blood disorders like Leukemia and Lupus, and other health problems that were previously unheard of in the community. Many of these illnesses would normally affect one in a hundred thousand, but Fort Chipewyan has seen up to five cases of the same disease in the village – a statistical improbability that has many blaming the toxic by-products released into the river by Syncrude, Suncor, and others. In Fort Chipewyan, more than 200 km downstream from Fort McMurray and close to the tar pits themselves, the town’s water treatment facility draws straight from Lake Athabasca. The fish caught by the few remaining local fishers are evidence of the toxicity of the water. Workers at the local fish plant report a range of deformities – from giant red sores that cover the entire head to bent tails and even two-headed fish. A couple of years ago, the animals living in the nearby forests were found to have over 400 times the safe allowable level of arsenic in their flesh.

A statistical analysis of the diseases of young and old alike led the Fort McMurray doctor John O’Connor to publicly call for an investigation into the causes of the pattern of illness. For his troubles, Health Canada has gone after the doctor rather than his message, stating that he was “causing undue alarm.” So far, it has refused to conduct an official study of the health of the community. O’Connor has received much support from Albertan physicians, environmental activists, and most importantly, unanimous support from the community. Residents would like to see mining and drilling put on hold at least until the source of the illnesses that are killing many of their people is properly identified. However, there are currently no public plans for water-system upgrades, let alone a recognition that a problem even exists. Yet, as a result of concerns over their water source, the government of the Dehcho Region has joined with Fort Chipewyan in calling for a moratorium on tar-sands related projects. Because this measure would “interfere with the market,” Stelmach’s government in Alberta, the Federal government, and the Alberta Energy and Utilities Board have all ignored these demands. Instead, they’ve outlined a new water management plan for the tar sands that will draw up to fifty bathtubs worth of water per second, even during a drought. This was announced in March of 2007, long after the problems hinted at throughout the process had become known.

The poisoning of the watershed is matched only by the destruction of the land. In order to get the tar to be made into mock oil, the land must be destroyed in a process that removes all life from it. First the Muskeg is drained and then the forest is levelled. The loss of forest cover, especially when combined with the pipeline infrastructure detailed in industry plans, gives Alberta the fastest rate of deforestation in the world outside the Amazon. After the trees are cut, the giant trucks that can hold hundreds of tonnes of land dig pits up to one hundred meters deep.3 In these tarpits, all the nutrient-rich topsoil – now re-christened “overburden” – is removed and the tar sands are scraped off the earth. The sands are dumped in giant vats (called slurries), boiled and spun until the bitumen separates. “Diluent” – a kerosene-like gas – is then added to the mix to help it flow through pipes to a refinery.

From there, it becomes crude oil and, perhaps, petroleum in a process that has already released massive amounts of greenhouse gasses even before the oil is burned in a vehicle or converted into a petrochemical by-product like fertilizer or plastics. Combined with breathtaking rates of extraction, this process is not only the leading source of Canada’s contribution to climate change, it is also creating one of the worst environmental footprints of any economic process in human history. TILMA will make it difficult to legislate changes in this process. The SPP will help provide the human labour and nuclear or hydrocarbon energy needed to carry it to fruition.

“Guest Workers”

TILMA destroys the rights of communities, provinces, and municipalities to “impact or impair” the free flow of goods or labour within BC and Alberta. The SPP creates a series of corridors for the flow of raw materials and capital while controlling the movement of people. To understand this properly, we need to keep in mind two separate maps.

Figure 1: The NAFTA Corridors and Canada

Figure I shows the massive highway corridors designed to move goods and cheap labour across North America. The SPP provides access through border laws and highway “fast tracking,” while TILMA creates labour laws to facilitate the immediate entry of “temporary guest workers” from places like Mexico and China to work in the tar sands (and prevent them from leaving their camps). Canadian Natural Resources Ltd began employing 500 Chinese labourers on a guest-worker program at their “Horizons Oilsands Project” last year. Earlier in 2007, two Chinese workers were killed on the worksite, crushed under a giant tank that collapsed while they were “learning on the job.”

Figure 2: Forecast Tar Sands Exports ~ 2030

Labour has literally run out in northern Alberta; companies are now paying to fly tar sands workers in weekly from the Maritimes. Labour availability lags far behind production.Currently, production of tar sands oil is at roughly 1.4 million barrels of oil a day (MBPD). The US has stated they would like to see an increase to 5 MBPD from “domestic” Alberta. The number of workers required for this massive undertaking will be in the tens of thousands. Even with those “fleeing” Venezuela or moving from the Maritimes and elsewhere, the deficit would take decades to make up if left to “the market” and normal population growth. Production targets are currently well-ahead of labour, energy, and pipeline infrastructure. The SPP’s expansion of “guest worker” programs (now up to 24 months in duration) are the only way such targets can be met under current conditions. Those employed through the guest- worker program will not receive the same wages or benefits as status-holding workers. These practices not only weaken the bargaining power of the unions already established in the area, but exploit non-status workers in much the same fashion as prison labour – a fitting analogy since they have no legal right to even visit the community of Fort McMurray.

Vast amounts of labour are needed to build the infrastructure of the energy sector. In order to understand the energy problem, we need to envision the second map: a map of the largest industrial project in human history (See figure 2). The energy needed for the tar sands would have to come from places like Alaska’s North Slope, coal-fired mega-plants in Alberta, new nuclear reactors in the Peace Region, and the industrialization of the Mackenzie Valley. The export of bitumen-sludge (later converted to mock oil) will require the construction of corridors across Saskatchewan and Manitoba, the Dakotas, Nebraska, and Kansas all the way to Pennsylvania, Illinois, Texas, Oklahoma, and Louisiana. Already, the Keystone Pipeline scheme – headed by Canadian energy company TransCanada – has caused the Alberta Federation of Labour to warn of job losses and the deregulation of operations that are currently union-run.

Another corridor for sending sludge to refineries is slated to go across BC, over the unceded lands of the Carrier, Gixtsan, Haisla, Tsimshian, and other indigenous nations, to a yet-to-be- constructed port out of Kitimat, where oil could theoretically be shipped to California, Japan, and China. This project – now delayed thanks to lawsuits launched by seven First Nation Indian Act-mandated governments – is called the Enbridge Gateway. Corridors heading southward include the Alberta Clipper Project and the Spearhead Expansion Project, also led by Alberta-based energy company Enbridge.

Stolen Land

For more than 30 years, the Dene and Inuvialuit have fought against the Mackenzie Gas Project (previously incarnated as the Mackenzie Valley Pipeline). Many things have changed since the days of the mid-1970s Federal Berger Inquiry aimed at gauging the opinions of the Mackenzie/Deh Cho Valley residents on the pipeline to be built across their traditional lands. What was originally conceived as an over-the-top pipeline that would cross the north of Yukon into Alaska has since been whittled down, affecting “only” the Beaufort Sea. Although the Dene and Inuvialuit alike once unanimously opposed the pipeline and had not settled “final deals” with Ottawa, today there are some nations that have signed extinguishment land claims (in the face of considerable internal dissent) and joined up with the “Aboriginal Pipeline Group” (currently involving the Indian Act governments of the Sahtu, Inuvialuit, and Gwich’in as possible investors in the project) while the Dehcho see such a pipeline as de facto attempt on the part of Ottawa to “extinguish” or otherwise diminish their inherent rights and legal title. The Dehcho Nation has refused any extinguishment or similar language used by the Federal government during the Dehcho Process. Nevertheless, the Berger Inquiry insisted that “final deals” with all nations from the Valley was a pre-condition for constructing any pipeline, should one go through. 40% of the proposed pipeline would traverse Dehcho lands. One of three things must happen to break this deadlock: either the Dehcho will accept some form of extinguishment, the pipeline will be denied and cancelled, or Berger’s recommendations will be ignored.

The original pipeline was already going to be the single largest industrial project in Canada’s history. Now, it has ballooned to a projected cost of $16.2 billion. The number is striking not only because of how large it is, but because the pipeline is now proposed as a mere feeder project for energy to fuel the production of mock oil. Using natural gas for this purpose has been compared to “composting caviar,” or “alchemy in reverse” – using the cleanest burning fossil fuel to produce the dirtiest burning fossil fuel. Recent efforts by the Dehcho Region’s government to gain permanent protection for massive swathes of their traditional land (an area the size of France) in return for permission to build the Mackenzie Gas Project have become bogged down as the Dehcho clamour for their voice to be included in decision-making about the tar sands gigaproject.

The tar sands giga-project also means the end of an un-legislated, but long observed, moratorium on oil and gas offshore tankers along the central BC Coast. Currently home to Grey and Humpback whale migration, BC’s inside passage might instead become home to the migration of hundreds of super tankers filled with oil and gas. Indigenous nations up and down the proposed corridor would see a loss of forest cover in National Parks and other areas where grizzlies still roam. The oil and gas pipelines would cross rivers and streams, and the tankers would pass through more than one thousand salmon spawning areas. These environmental costs are not “balanced” through “gains” for labour – the entire 1200-plus kilometer pipeline system is projected to provide only 75 full-time jobs after its completion. Meanwhile, Enbridge has quietly shifted its plans for delivery of mock oil by sending the oil south in old and new pipelines into the Lower 48 to places like Oklahoma, Illinois, Texas and Pennsylvania, with a promise to complete their Gateway mega project a few years down the line.

In this light, it becomes easier to understand BC Premier Gordon Campbell’s eagerness to complete the treaty signing process in BC despite having held a 2002 referendum that sought to limit the rights of indigenous peoples. Did Campbell suddenly see the light on treaty negotiations? Or is he strategically enabling BC’s contribution to the tar sands giga-project by trying to resolve as many outstanding treaty issues as possible in order to preserve “investor certainty”? When the Lheidli T’enneh treaty (located just outside of Prince George, BC) was rejected, the media noted its significance but not its location – right in the path of the proposed oil shipping corridors to Kitimat and Prince Rupert.

TILMA and the SPP represent a radical shift toward environmental degradation, not only in Alberta and BC, but on a continental level. The “tar pits” – the vast dead landscapes of giant mines near Fort McMurray – have already absorbed the available labour and energy while their pipelines already operate at well over capacity. With even the optimists projecting a lengthy wait for new natural gas lines to fuel the tar pit mines, the energy capitalists are now clamoring for the return of nuclear energy. On August 28, 2007, Peace River was officially picked as a site for an application to construct two Candu nuclear reactors, in order to feed the insatiable energy demands of the tar sands. TILMA makes local legislation in both BC and Alberta essentially the same. Conseqently, if a nuclear plant is built in Peace River, it will become very difficult to block one anywhere in British Columbia.

Resistance

TILMA and SPP are simply localized expressions of the global scramble for oil and other hydrocarbon energy forms. The loss of oil production in Iraq, on-going war in the Middle East, and a corresponding rise in oil prices have led to a high demand for tar sands production. Although it may sound counter-intuitive, when production is disrupted by hurricanes, declining reserves, or insurgent sabotage, the decline in oil supply actually strengthens US control over global oil reserves. This is because the rising cost of oil brings tar sands mock oil into closer alignment with regular sweet crude, and gives a much larger share of global oil production to North America. This radical shift toward the tar sands has given the US an oil supply it can rely upon while other markets remain “unstable.” Tar sands production becomes far more economical with the rising cost of oil. According to the industry, profitable tar sands extraction requires that world oil prices don’t slip below $30 a barrel. As long as Canadian “mock oil” keeps flowing south, the US will continue to control a larger share than its rivals during the coming decline of world oil production.

But the tar sands projects are generating community outcry from Kitamaat Village to Kansas and from the Dakotas to the Arctic. Resistance is growing among Edmonton residents forced into homelessness. There are many fighting to defend unions, the rights of non-status workers, the existence of grizzly bears, and the health of the mighty Pacific Ocean. In Alberta, the over-development triggered by the tar sands is also producing a dramatic change in public opinion. When the Albertan government speaks against “reining in” the tar sands because “market principles must decide,” they obscure the role that US and Canadian government policies have played. It is legislative and interventionist state policy, not the market, that enables the construction of highways strethcing from Panama City to Fort McMurray. When the government speaks against “tinkering” (including rent controls to protect people from homelessness in Edmonton, where a booming economy has yielded astronomical rent increases), they mean the “tinkering” carried out by everyday people. Even Fort McMurray – a municipality historically in hock to the oil companies – has called for a moratorium on any new leases or project approvals because the current pace of production is destroying whatever thin veneer of community coherence still remains in the besieged city.

The population of Alberta is waking up and becoming increasingly concerned about the evolving social, political, and ecological devastation that tar sands oil production entails. But information is not enough. It is no longer sufficient to hold conferences and send out press releases. Discussions about how to stop tar sands production – whether by disrupting tradeshows, the “consultations” held by government officials, or even engaging in outright blockades of the tar pits themselves – will soon be on the agenda. It is difficult to overstate the potential significance of such acts. Every time production is hampered, the infrastructure fueling the US “war on terror” will be affected in a more significant way than by any other act inside North America. Such struggles will also raise the political cost of the tar sands, and perhaps might cause international investors to think twice before diving headlong into northern Alberta. The economic cost of the tar pits is astronomical – in the hundreds of billions of dollars for proposed infrastructure alone. So, too, are the attendant political risks, since the attraction of this dubious form of production comes from the “stability” and “pliant” nature of the governments managing access to the Athabascan tar sands. If we can disrupt the tar sands, and eliminate notions of environmental movements “working with industry,” then social justice movements in Canada can begin to shape politics not only regionally and nationally, but also on a global scale.

Tar sands oil production is more than an assault on the right to a healthy biosphere. It is the primary resource contribution being made toward the “war on terror” in North America. On this basis, it should be seen as a domestic point of resistance that not only questions capitalism but that calls for new kinds of relationships between workers, indigenous nations, and the earth. Resisting the tar sands provides a clear and accessible strategic entry point for social justice activists to challenge the current world order based on oil, war, and racism. By taking our resistance to the Empire’s oil supply, we can take our place on the global stage like never before. If we do so paying attention to everything that is entailed by the principle of social justice, our resistance can illuminate a new world being born as we speak. No longer should we watch from the sidelines. Instead, let’s use our position in this country to disrupt the Empire’s “business as usual.”

Notes

1 http://www.pej.org/html/print.php?sid=6766

2 For more information on these and other threats to the Athabasca and other Albertan river systems consult the work of Dr David Schindler, a professor from the University of Alberta openly critical of water use by Albertan oil and gas corporations. http://www.biology.ualberta.ca/schindler.hp/schindle.html

3 http://www.oilsandswatch.org/overview