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No Security in Canada's Pipeline Plans

Proposed 'Energy East' line to the Atlantic leaves us vulnerable to spills and another supply crisis.

By Gordon Laxer 20 Aug 2013 |

Gordon Laxer is a political economist and the founding director and former head of Parkland Institute at the University of Alberta.

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Keystone XL may have stalled, but TransCanada is determined to pipe out Albertan oil. Photo by Loozrboy via Creative Commons.

On a recent trip to an oil refinery in Saint John New Brunswick, Prime Minister Stephen Harper exclaimed that with TransCanada's proposed Energy East Pipeline, "We're not just expanding our markets for our energy projects... We are also at the same time making sure that Canadians themselves benefit from those projects and from that gain energy security."

It's refreshing to finally hear Harper talk about energy security for Canadians. This country is vulnerable to the next international oil supply crisis because it still imports almost half the oil Canadians use.

Atlantic Canadians are particularly exposed, dependent on imports from dodgy sources like Algeria, Saudi Arabia and Angola for more than 80 per cent of the oil it takes to heat their homes and fuel their cars through long icy winters.

However, would TransCanada's Energy East pipeline really give Atlantic Canadians the energy security they need? Not necessarily.

NAFTA guarantees US access

Piping oil from far-off Alberta to Atlantic Canada might make corporate sense, but it doesn't make common sense.

Although east coast consumers would love to get cheaper western oil, Alberta's oil sands producers have the opposite intent. They simply want to reach tidewater to get the world oil price.

TransCanada is teaming up with Irving Oil to build an ice-free, deepwater port in Saint John to receive the world's largest oil tankers and export Western Canadian oil to the globe's most lucrative markets.

It is clear that the oil on TransCanada's proposed line would go to the highest bidder and that Ottawa would not protect Atlantic Canadians oil needs before allowing exports.

Newfoundland's offshore oil fields produce just fewer than 200,000 barrels of oil a day, enough to meet all the oil demand in the four Atlantic provinces. Wouldn't east coasters be most energy secure if they relied totally on their own oil?

Absurdly, Newfoundlanders don't get the oil they produce. The majority of it is exported and the U.S. gets first access to it through NAFTA's proportionality clause.

NAFTA's proportionality clause was never in the best interest of Canadians, only that of corporate oil. The clause was crafted to allow mainly foreign petro-corporations export as much Canadian oil and natural gas to the U.S. as possible. It was written before the end of the age of cheap oil and before we realized the coming catastrophe of climate change.

But President Barack Obama's temporary halting of TransCanada's proposed Keystone XL pipeline broke the bargain that underlay NAFTA: guaranteed access of Canadian energy exports to the U.S. in return for U.S. first access to Canada's energy resources.

It's clear that the U.S. can block Canadian energy exports at will. Why should we continue to give the U.S. unlimited access to our energy?

If Washington attempts to use NAFTA to stop Atlantic Canadians from getting first access to their own oil, Canada can give six months notice to end NAFTA, as Barack Obama and Hilary Clinton threatened to do in the 2008 Democratic party primaries.

Tankers a better option

Russ Girling, president and CEO of TransCanada, calls the proposed Energy East line a nation-building project like the Canadian Pacific Railway and the TransCanada Highway. It is no such thing. It is merely an Alberta oil sands exporting line for transnational oil corporations dressed up in nationalist clothing.

Most Atlantic Canadians live on the coast or near it. There is no need for a pipeline to bring most of them oil when it can be shipped in. Why build a pipeline with its risks of spills and invasions of First Nations lands?

Tankers, if double hulled, are safer than oil pipelines. While a pipeline will demand oil to fill it for half a century, tankers can be phased out as oil use falls.

Phasing out oil as we increase electricity produced by renewables is the only real long-term solution for energy security. We can use Newfoundland's declining oil output as an impetus to transition the four provinces to a low carbon society.

If Harper really cares about Atlantic Canadians' energy security, he would say yes to Atlantic oil for Atlantic Canadians and no to a spill-prone oil pipeline from Quebec to Saint John.  [Tyee]

Read more: Energy, Politics

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