By Carolina Luna
At first blush, oil doesn’t have a lot to recommend it as an energy source. It’s dirty, poisonous, contributes to global carbon emissions, most energy released when oil is burned is lost as heat, and just try getting it out of cashmere. Still, the world can’t get enough of this stuff, and that demand is “fueling” interest in oil sources once too difficult or expensive to exploit. One source making the news recently is the Canadian Tar Sands and the Keystone XL pipeline, which President Obama shot down after Congressional Republicans forced him to either approve the pipeline or suspend it indefinitely.
So what is the Keystone XL, besides a great name for a steak? The proposed pipeline would be a 36-inch crude oil pipeline stretching nearly 2,000 miles from Hardisty, Alberta to the Gulf of Mexico.
Sounds simple enough, right? It turns out tar sands oil – think dirty motor oil spilled into sandbox and you’re on the right track – is a far cry from Jed Clampit’s Texas Tea. Tar sands crude is an acidic, corrosive, and potentially unstable blend of thick raw bitumen. Naturally, This type of unconventional crude oil raises a lot of questions about safety and health hazards due to its instability. The potential of having a spill that would damage communities along the pipeline is a serious concern. TransCanada, the company in charge of the pipe, asserts that Keystone XL is safe and good for the United States because it will create jobs and reduce the country’s foreign oil dependency. Oil sands are an especially dirty type of crude oil, with high levels of greenhouse gas emissions and enormous lakes of toxic waste.
Oil Sands: Canada’s Dirty Little Secret
Don’t be fooled by their easy smiles and single-payer healthcare, our friendly northern neighbor is a regular T. Boone Pickens. Canada has the third highest oil reserves in the world – only behind Saudi Arabia and Venezuela – with about 175.2 billion barrels worth of gooey hydrocarbons lurking beneath. The catch? Nearly 97 percent of Canada’s reserves are trapped as unconventional, hard-to-extract bitumen deposits. Bitumen is a thick substance that can be refined, at a relatively high cost, into a synthetic crude oil. Oil sands consist of this bitumen and the world’s largest oil sand deposits are in Northeastern Alberta under Canada’s Boreal forests and wetlands.
We all have some vague idea of how conventional oil extraction works. Like a giant Capri Sun juice pouch, the oil is trapped underground until we jam a giant straw into it and the pressure makes it shoot out. Then we profit (or drink).
By contrast, the process of turning tar sands into oil for fuel is laborious, expensive, and even more damaging to the environment. In Canada, tar sands operations have destroyed or altered countless acres of ancient Boreal forests and wetlands. Not only does the tar sand oil generate CO2 when burned, but the CO2 release begins with extraction, when the layers of both dead and living, carbon-rich vegetation is stripped away to access the oily sand below.
About 20 percent of the oil sands in Alberta are extracted by good, old-fashioned surface mining, a process that requires hot water to separate the bitumen from the sand and clay. For the remaining 80 percent most oil companies use a method called steam-assisted gravity drainage; a procedure that injects steam into the ground to separate the bitumen from the sand – the bitumen needs to be liquefied in order to be pump out. It is estimated that the expansion of tar sands operations in the Athabasca River Valley will expand around an area the size of the state of Florida.
“Producing one barrel of Tar Sands oil,” argues environmental group ForestEthics, “generates three to five times the global warming emissions that producing the same amount of conventional oil would.” It’s not just the CO2, as three million barrels a day of drinking-quality H2O are used in the production of tar sands oil.
Its production has created more than 65 square miles of human-made toxic waste ponds, where they keep all the stuff they take from the Earth that can’t be turned into usable crude. Others claim the production of tar sands oil also threatens the migration of millions of birds in the forests and wetlands of the region.
For the people who live nearby – especially for Canada’s Native American culture – the production of tar sands represents a hazard to their health, culture, and livelihoods. Although proving causation is difficult, the indigenous community at Ft. Chipewyan has reported high rates of rare cancers such as lupus and hyperthyroidism. This might have something to do with the waste ponds and the estimated 11 million liters of toxic water that has leached into the local water supply. In following their traditional way of life, Canada’s First Nation people are dependent on the lands and waters of the region. The tar sands oil operations have impacted the Skeena and Fraser Rivers’ salmon, the already-endangered Nechako White Sturgeon, and the shellfish from the mainland coast to Haida Gwaii.
Could the Keystone XL Pipeline Lower Oil Prices?
In the mid-2000s the high demand for petroleum products increased the prices for gasoline, heating oil, and other products around the world affecting American consumers. Simple market principles tell us that if demands are high, prices will be, too, especially if the crude oil is from an unconventional source like tar sands.
Some policymakers argue that a solution to this ongoing problem is allowing TransCanada to build its oil pipeline across the country to the Gulf of Mexico. “In the United States,” argues the Heinrich Boll Foundation and Friends of the Earth Europe, “energy security has been repeatedly cited as a national security priority, trumping climate protection concerns surrounding Canadian tar sands extraction.” For the oil industry and government supporters, Canada represents a stable and friendly source of oil.
Another common refrain- often heard by those pressing to unlock protected land for drilling, is that the increase of supply will lower oil prices, and, so the thinking goes, the prices consumers pay for gasoline. Such an argument ignores vital facts about the global commodity markets. This Canadian oil will not be relegated to special, North America-only VIP lounge where the prices stay artificially low for American consumers. Instead it will be pumped out into the great global oil market, where the additional flow will be just one more modest input into the complex weave of worldwide oil supply and demand.
Tellingly, advocates of expanded oil exploration and drilling projects usually compare the expected hydrocarbon haul of a project with only the US’s demand – while knowing the global demand will actually determine the impact, if any, that the project will have on oil prices.