U.S. taps Canada’s oil sands, but at an environmental cost

Published 4:00 am Wednesday, November 12, 2008

FORT McMURRAY, Alberta — For decades, the U.S. has vowed to reduce its dependence on imported oil and to find a reliable source to meet the nation’s growing oil needs.

Now, Canada offers a solution.

While oil supplies are dwindling in some places, or disrupted by seasonal hurricanes, threatened by terrorist attacks or controlled by hostile governments, Alberta’s oil sands — a patch of forest about the size of Florida with a sea of oil beneath it — produce more crude than all the wells in Texas or Alaska.

With more than 170 billion barrels, the oil sands are the second-largest proven reserves in the world, after Saudi Arabia.

Because of the Alberta oil sands, Canada has become the largest supplier of crude oil to the United States. The oil sands are booming, and production is expected to triple in a little more than a decade.

Also growing are the environmental costs — higher greenhouse gas emissions than conventional oil and long-term destruction of a swath of deep forest. In the past few months, Alberta officials have announced new environmental policies and plans to invest $3.7 billion to cut emissions. What’s clear so far is that they’re facing an environmental problem — supersized.

“We’re an energy province. We’re now producing record amounts of oil. We have the potential to actually increase our production of oil,” Alberta energy official Christopher Holly said.

“So one of the things that’s beginning to happen,” Holly said, “is we’re beginning to recognize the need to take a look at the entire energy framework … to look at the balance between being a supplier and also being an environmental steward.”

The Alberta government controls the rights to this oil and is in charge of environmental protection. This year, the western Canadian province of about 3.5 million has an estimated $7.9 billion surplus.

Demand for fuel in North America will keep oil sands production growing from 1.2 million barrels per day in 2007 to 3.5 million to 4 million barrels per day by 2020, Alberta Oil Minister Mel Knight said. “I don’t see anything on the horizon that would indicate that isn’t a target that’s doable.”

Oil companies are expanding so fast in Alberta that the three big players — Suncor Energy Inc., Syncrude Canada Ltd. and Albian Sands Energy Inc. — have built their own airstrips to ferry in temporary construction workers. Exxon Mobil Corp., Royal Dutch Shell PLC and many other companies have investments in the big operators.

Workers from all over Canada, plus miners from South Africa and oil workers from Venezuela, have moved to Fort McMurray. Housing costs are sky high. The boomtown of 65,000 has an additional 27,000 temporary workers living in camper trailers and motels.

From a helicopter, the view of this growth begins with a forest of spruce, pine, poplar and aspen spotted with ancient bogs under a summer cover of bright green algae. That landscape suddenly gives way to miles of black strip mines, brownish settling ponds with a rainbow sheen, and beyond the mines, well pads amid grids of roads and cuts from geological seismic surveys.

Some of the world’s biggest trucks — two-story-tall Caterpillar 797Bs that carry 400 tons — haul the black sands through strip mines. Scarecrows with orange cloth bodies and blue hardhats surround huge ponds of mining residues.

About 200 square miles have been mined, close to the Athabasca River.

But most of the thick crude oil lies farther from the river, too deep to be scraped off. Here the thick oil is heated by steam piped underground so that it can be pumped.

The sands contain a form of crude oil called bitumen that’s as thick as peanut butter. To remove the sand and clay to turn the bitumen into heavy crude that can flow to refineries takes a lot of energy.

For that reason, greenhouse-gas emissions from production are three to five times those of conventional oil.

Another way to measure these emissions is to consider the full “life cycle” of the oil from extraction to final use, such as gasoline in a car. By this measure, fuel from the oil sands produces 10 to 15 percent more greenhouse gas emissions than conventional oil. That’s because about three-quarters of the emissions come when the fuel is burned to drive. Scientists have determined that heat-trapping gases from fossil fuel burning are largely responsible for the major climate changes of recent decades.

Alberta’s environmental officials forecast that with the new policies in place, the province’s emissions will increase until 2020 and then decline to 14 percent below 2005 levels by 2050. Global targets based on the 2007 findings of the Intergovernmental Panel on Climate Change are 50 percent to 85 percent reductions from 2000 levels.

Other environmental concerns are with the Athabasca River and the forest.

Preston McEachern of the province’s oil sands environmental management division said oil sands production has not harmed the river.

David Schindler, an ecology professor at the University of Alberta, said it’s not true that no mining pollution reaches the Athabasca. He challenged the government’s handling of its data and said new studies are under way about pollutants in the river and whether the mining companies draw out too much water when the river is naturally low.

Canadian First Nations people living downstream of the oil sands report an unexplained cluster of rare cancers. This summer, a two-jawed fish washed ashore.

Canada needs the oil, but the people need clean water, said Patrick Mercredi, the medical director of Athabasca Tribal Council, who grew up downriver learning to hunt and trap as his ancestors did. He said people are worried about contaminants in fish and game.

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