Is the environmental attack on the Oil Sands going to make any headway?

A recent article in the Globe and Mail signalled that the fate of the hyper-destructive and very profitable Alberta Oil Sands might well be tipping in favour of those opposed to them. The article outlines the role the Norwegian state-owned oil company, Statoil, who has invested over $2B in the Oil Sands, is having in the country's federal elections.

Norway, from an international standpoint, is widely regarded as a friendly, progressive country, similar to its counterparts in Scandinavia. And even its historic oil industry -- Norway is the world's first country to employ a one-way CCS project -- is among the more respectable groups in the sector.

So being involved in the Oil Sands is sure to raise some eyebrows and rustle some feathers. The negativity of Statoil's involvement in the Oil Sands is so heavy that it could play a major role in the federal election as candidates from nearly every party are promising to carefully examine the role of Norway's state-owned company. One prominent leader is already offering to create environmental laws that would make it impossible for Statoil to even come close to getting involved with anything like the Oil Sands.

Norway is not the only one rethinking its involvement in Alberta. Even the Chinese government, whose state-owned oil enterprise is heavily invested in the Oil Sands, is looking at what's going on. The article also mentions that several Chinese journalists are on their way to take a tour of the areas surrounding the Oil Sands to witness the environmental destruction of the place.

But before we start to think that the tables have really turned and the Oil Sands are on their way to being shut down, let's just put a few things in perspective.

Statoil is state-owned. Generally speaking, state-owned energy companies have a lot more to answer to than their purely private contenders, especially in a country like Norway. The Chinese, although to a much lesser degree of social & environmental responsibility, are also state-owned. The downside is that the majority of investment in the Oil Sands is private. Private companies often, but not always, answer only to their shareholders who often, but again, not always, only want to make more money. The Oil Sands make money. Lots of it.

Secondly, keep in mind that it is election time in Norway. For those of us who have followed election campaigns, they are filled with promises. Often, these promises are politically charged and do not always come to fruition. Considering the length of time it would take to get out of there and the investment losses, the task of pulling out would be very difficult. I would not be surprised if this issue slowly fades away after election fever winds away.

Thirdly, and almost in summation, the Oil Sands are very, very lucrative. They are profitable for those involved and beneficiaries range from international partners (the United States) to domestic governments (Alberta). The Alberta government has certainly signalled more than once how little it really cares about the environmental consequences and its internal bureaucratic systems (see Andrew NikiForuk's Tar Sands) are far from being pro-environment. Furthermore, the Conservative stronghold of Alberta is almost insurmountable and if the current policies of both the Alberta and Federal Conservative government's is any indication, these policies are not going to change quickly.

And I wouldn't put too much money on Obama making a big deal about the Oil Sands anytime soon. His hands are full with his health care reform plan and any fight with the Oil Sands would surely have short-term economic consequences, which is the last thing he needs as the U.S. economy is starting to recover. Right now, he has bigger, more homegrown fish to fry.

I don't mean to sound like a pessimist, but the Oil Sands are big. Very big. I do not deny the environmental, economic and health damages due to the Oil Sands, but tackling such a beast is so complex and in my opinion, nearly impossible. However, I would urge those already fighting to shut down the Oil Sands to keep on doing what they're doing, as anything helps in the struggle against them.

But in some ways we need to be a bit realistic and make the best out of an already awful situation by looking more into conservation strategies, renewable energy markets and to pressure our elected officials. Perhaps we could at least reduce the demand for oil in this country. But really fighting the Oil Sands seems like a steep moutain to climb.

I can only hope I'm wrong.

A Big Opening for Pesticide Policy in Canada...

The saga of the controversial cosmetic pesticide ban in Quebec is storming on. Amidst all the legal chaos taking place between DowChemical and the governments of Canada and the province of Quebec, the Ontario government's own ban on cosmetic pesticides came into effect today. 

Ontario's ban prohibits approximately 250 different products from being used for cosmetic purposes and is now considered the world's toughest regulation on cosmetic pesticides. There is no indication from DowChemical--the huge chemical company that is currently in a snit over Quebec's ban of one of its chemicals--as to whether or not it'll pursue similar legal action against Ontario's ban.

If it were to pursue legal action, it would have to go through the federal government because it is filed under NAFTA. As it stands, the lawsuit against Quebec's ban technically lists the federal government as the defendant. If Dow were to pursue action against Ontario, it would be a nearly identical case so it would make most sense for it to add the Ontario ban to its list of woes. This would, of course, raise the size of the NAFTA claim significantly because of the huge market share in Ontario that could be lost.

But Dow might not do that. It might see how the Quebec case goes and if they win, then they'll start hunting down all the other jurisdictions that have banned its product. We can only hope they don't win because if they do, governments will have little motivation to regulate on environmental issues.

But here's an opportunity. Two of the largest provincial economies in Canada have banned cosmetic pesticides. Since the lawsuit is going directly through the federal government, it is technically targeted at a 'Canadian' regulation rather than a provincial one specifically. All of the other Canadian provinces and territories should take this opportunity to implement their own bans of cosmetic pesticides. 

It might be risky in that if Dow wins, all the provinces that regulate the pesticides might be subject to a large fine. But if all the main jurisdictions of Canada were to implement similar bans it would certainly strengthen the case for the federal government in the DowChemical case. Furthermore it would indicate to the federal government how important such an issue is.

Most importantly, any type of potential ban like this would strengthen the case for jurisdictions to be able to regulate on important environmental issues, regardless of Chapter 11 and the rest of NAFTA.

Happy Earth Day, kids.  

Canada may hop on the American bandwagon...

Stephen Harper's Conservative government has rarely been one to budge in the face of opposition, even as a minority government. When the Canadian public, international organizations and even the United States brought an issue to the table, Harper's government has usually been quick to quash it or simply ignore it.

Climate change policy has often fell victim to Harper's my-way-or-the-highway approach. But legislation being tabled in the United States could change that. The bill would impose border duties (tariffs) on products coming into the United States from countries whose climate change policies are deemed to be too lax. 

Canada, with its sneaky intensity-based measurements and laughable overall GHG reduction targets, would fall under the rules of the new legislation.

It strikes me that this type of legislation might have implications under NAFTA, or at least the WTO, two free trade agreements that Harper is usually quick to reference. But the initial reaction from the Harper camp has not been one of disagreement, but one of conciliation. Jim Prentice, the federal Minister of the Environment has conceded that Canada must now adopt climate change strategies "comparable" to those that will be passed in the United States.

This brings up an important point. As it stands, the United States has no large, formal strategies or policies for combating climate change, despite the heavy rhetoric of the Obama administration. Considering Obama's political power these days, it is expected that something will get passed relatively soon.

He favours a national Cap-and-trade system (something Canada would be smart to partner with), but getting this passed through Congress might be an uphill battle, even for him. This is because a cap-and-trade system would severely hinder the coal industry and particularly the Midwestern states reliant on that industry. To Obama's dismay, these states are largely Democrat, so upsetting them would not bode well politically. As a result, a hefty portion of Democrats are prepared to shoot down any proposed cap-and-trade system.

So you would think that with such an unlikely chance of the bill getting through that the usually staunch Harperites wouldn't take it seriously? Well, somehow or other they've opened their eyes and can see the writing on the wall. 

Obama is powerful and lots of people like him, including Canadians. The cap-and-trade system will eventually get passed in the U.S. (even if it's slightly watered down), probably before December during the post-Kyoto conference in Copenhagen. And NAFTA disputes tend to warrant in the favour of the United States. He and his policies are fairly dangerous to oppose, especially as the popularity of the Harper government slowly falls.

Clearly, conceding to the potential rules is a political move by the Tories, but environmentalists can applaud such a move. For once, having a government that seeks to mirror our older sibling to the South may actually be beneficial.