Please Canada, develop the oil sands of Alberta!

Post ImageI have long thought that we as a country should be investing more money in energy, including properly developing Alberta’s vast oil sands. Canada could become the most important region in the world for oil if we were able to extract it efficiently enough – and while it may not the best for the environment, it would certainly be a welcome change to have the oil capital of the world in a democratic, peaceful place for once. A new report from CIBC World Markets seems to support the idea of developing the oil sands, suggesting it will become the most important source of new oil by 2010:

Alberta will sit on one of the most valuable energy sources in the world by that time, and one of the few still open to private investment, said Jeff Rubin, chief economist at CIBC World Markets, the bank’s wholesale banking arm.

He added that conventional oil production around the world apparently peaked in 2004.

Energy companies are finding new oil, but most of it will come from non-conventional sources. Ocean oil rigs are the primary source of new oil today, with Alberta’s oil sands tomorrow, with expansion projects rivaling those of Saudi Arabia.

If we were able to properly develop the oil sands, without ceding too much control to the United States, Canada could become very rich, and the world would have oil for longer than is currently projected. This means two things would happen; first, the push for alternative energy sources may be slightly delayed and second, Canada could use its new wealth to invest in those alternative energy sources to be prepared for the time when no more oil can be extracted. If we sit back and choose not to increase production, the world will shift to other sources of energy more quickly, and we might one day be left with a bunch of useless oil, or at least, much less valuable oil.

One of the problems with the oil sands is that our technology is not good enough to efficiently extract the oil on a large scale. There has been some progress, but not enough. So how do we solve that problem?

  • We could just hope that Syncrude, Suncor, and the other companies involved figure it out.
  • The Canadian government itself could hire lots of researchers, engineers, chemists, whoever it takes, to try and improve the technology.
  • Canada could sponsor a research competition, kind of like NASA or DARPA’s popular programs in the United States. Challenge people to develop the most efficient, least harmful process for extracting oil from the oil sands. This is probably the best way to get some quick, meaningful innovation.

The point is that problems are not insurmountable.

There are lots of people who want Alberta to be the only one to profit from our reserves, but I don’t think there’s any reason that Alberta cannot be properly compensated and still have the entire country benefit. We don’t want Trudeau’s NEP, but we do need a national policy that recognizes Alberta and benefits all.

Unfortunately, our political parties do not seem that interested in developing such a policy. Vitality Magazine has a good round up of the “green” platforms the parties have announced for Monday’s election. There are quite a few mentions of alternative energy sources, but no mention of the oil sands. I think if we’re serious about alternative energy, we need to invest a lot of money into it, and what better way to obtain that much money than by fully exploiting the oil sands?

The oil sands offer our country very unique possibilities for the future. Let’s do something with the oil sands and take advantage of those possibilities!

(For more information, read these notes I took during a September 2005 conference that included some discussion on Canada, the oil sands, and the need for a national policy on energy.)

Big Oil Profits and Alberta

I
thought I’d highlight this rather interesting discussion on the big oil
companies and their profits taking place at Robert McClelland’s My Blahg. After describing the profits of Exxon Mobil, Royal Dutch Shell, and Petro-Canada (all up, surprise surprise) Robert had this to say:

Pricks. I say regulate them. And to hell with Alberta if they don’t like it.

And later in the comments he says:

Someone else: And the NEP worked really well last time didn’t it…

Robert: It worked great for Eastern Canada where I live and only care about.

I don’t know if he’s trying to be funny, or if he’s serious, but I
thought they were interesting comments nonetheless. I don’t think it’s
fair to blame Alberta for the current rise in prices. There are a
number of different factors, including speculators as explained by Mark Cuban back in September.

Not only that, but Alberta is using at least some of the profits from oil for worthy purposes. For example, we’ve stockpiled lots of Tamiflu and are ready to share.
We’re also investing more in our already top notch childcare
facilities. You can be bitter about the high cost of oil and the amount
Alberta profits, but it’s not like we’re actively spending money to
snub the other provinces!

That being said, I wish Alberta would take the lead and get a
national energy policy started. It would be wise to be proactive about
it, instead of defensive, I think.

MORE: One other thing I wanted to point out – I think Albertans have just as much reason to complain about oil prices as anyone else. The oil is extracted here, refined here, and doesn’t have to travel anywhere else, yet we pay around 90 cents a litre (as of today). How does that make sense? There are absolutely no distribution costs, especially here in Edmonton where we have a number of refineries, yet we pay just as much as everyone else.

Read: My Blahg

Waste Reduction Week in Canada

Post ImageDid you know that October 17th-23rd is Waste Reduction Week in Canada? I didn’t until yesterday when I happened to be walking through the Students’ Union Building on campus and came across a display. Municipalities can declare the week in their town or city, schools and businesses can register to participate, and of course we as individuals can do our part. Looks like Edmonton proclaimed the week last year.

There isn’t much on their website about the event or it’s history, so I don’t really know that much about it. You can however check the website for events and activities. They’ve also got some activities you can do yourself, like the Home Waste Audit and the Ecological Footprint Survey.

With almost perfect timing, an article in today’s Edmonton Journal gave an idea of where Canada ranks in the world on waste and energy use:

Canada’s environmental performance ranks almost dead last among major industrialized countries, according to a sweeping new study. The report, prepared by Simon Fraser University and published Tuesday by the David Suzuki Foundation, puts Canada 28th among 30 Organization for Economic Co-operation and Development countries.

Researchers looked at 29 environmental indicators to make their determinations, placing Canada 26th or lower in 12 categories. It ranked Canada dead last in the production of nuclear waste, carbon monoxide and volatile organic compounds. It was 29th in per-capita water consumption, sulphur oxide emissions and energy use.

Basically, we’re not doing that well in terms of reducing waste! The United States finished last, and Turkey finished first, with Switzerland and Denmark in second and third. Some other interesting things to note from the article:

  • Canada did not finish first in any environmental performance category and got failing grades in 24 of 29 indicators.
  • Its best ranking was second in the volume of timber harvested per square kilometre and fifth in the ratio of timber harvest to forest growth.
  • Canada has not improved its environmental performance relative to other OECD countries since 1992, when it was also 28th.

On that note, Happy Waste Reduction Week!

Read: Waste Reduction Week

Locking gas caps!

Post ImageHow can you tell that gas prices are far too high? Well, you might spit coffee all over the dash when you drive up to the pump and see the price, or you might be checking prices on one of those converters that makes your car burn restaurant grease as fuel. Or, you might even be ordering a locking gas cap:

The word from Pittsburgh is that auto parts suppliers are rapidly selling out of locking gas caps, which were originally invented in the 30s because of gas thefts during the Great Depression. Buyers are reporting their gas tanks have been siphoned, or that they want to head off potential siphoning due to ever-rising gas prices. Some stores are having difficulty getting more units in stock from manufacturers.

There was a similar little article in today’s Dose too. Are people really siphoning gas, or is this a little bit of Pimp My Ride? I mean gas prices are so high, what’s another few dollars on a locking gas cap right?

Read: Engadget

Oil prices will go higher

Post ImageDriving to work earlier today, I noticed that some gas stations have raised prices again, this time to 102.9. I have never seen gas prices so high, and I never thought I would. I remember a few years ago when a litre of gas cost less than half what it does today. And the worst news of all? Oil prices are going to keep rising.

If you think I’m joking, read this Economist.com article. It does an excellent job of explaining things:

So far, however, the effect of higher prices has been surprisingly muted. Gas-guzzling America has seen GDP grow at a brisk clip, far outstripping many of its daintier peers in the rich world. Though high oil prices are contributing to America’s surging (and unsustainable) current-account deficit, they do not seem to be worrying consumers, who have kept on spending.

In part, this is because the oil-price records are an illusion, brought about by inflation. While nominal prices are at record levels, in real (inflation-adjusted) terms they are still well below those seen in the wake of the 1979 Iran hostage crisis, when the cost of a barrel of oil hovered around $90 in today’s dollars (see chart). Consumers are better-off now—in 1980, the median personal income in America was $16,800 (in 2003 prices), versus $22,700 in 2003—and economies are more fuel-efficient. Both of these things should cushion the shock of higher prices.

There are other factors to consider too. During the hostage crisis, OPEC deliberately kept prices higher than the market could bear – but it backfired. We became more fuel efficient as a result, something OPEC would not want to do again. There’s a theory though, that they have lost the control required to keep prices artificially high anyway:

With the exception of Saudi Arabia, its producers are pumping as much as they can—and Saudi excess capacity is in heavy crude that is harder to refine into the cleaner fuels demanded by rich countries. OPEC made a great show of raising its members’ combined quotas to 28m barrels per day (bpd) in June. But thanks to rampant cheating, they were already pumping at least that much, and possibly as much as 30m bpd, making OPEC’s promises little more than a carefully staged bit of public relations.

There is an excellent Wikipedia article covering the current increase in oil prices, complete with breakdowns of demand and supply, and some excellent charts. It too, says the worst is yet to come:

While oil prices are considerably higher than a year ago, they are still far from exceeding the inflation-adjusted peak set in 1980.

There are lots of people talking about the gas prices, obviously. The number eight search on Technorati right now is gas prices. And over on Flickr, you can check out some of the prices around the world as people take pictures and post them.

Here in Edmonton, you can keep an eye on gas prices at EdmontonGasPrices.com. And if you think it’s time to park the car, the ETS website is http://www.takeets.com.

Read: Economist.com