February 9, 2009
Q&A: Energy Independence, Obama and Canada’s Oil Sands
By John Lorinc
“There are two perspectives on the oil sands,” the author Andrew
Nikiforuk says. “You have companies that want to make it the next
Saudi Arabia. The other is that it’s a transitional resource to a low-
carbon economy.”
Andrew Nikiforuk, a journalist based in Calgary, has closely followed
the development of northern Alberta’s massive deposits of bitumen — a
heavy black oil impregnating the sand and soil over hundreds of square
miles northeast of Edmonton.
The oil sands, or tar sands, as they are sometimes known, must undergo
rigorous processing to extract useable oil — an expensive and dirty
undertaking that becomes more attractive to developers as oil prices
climb, and less so as they fall.
The province saw unprecedented growth at the oil sands over the last
decade, but low global oil prices have now stalled Alberta’s bitumen
boom.
In his 2008 book, “Tar Sands: Dirty Oil and the Future of a
Continent,” Nikiforuk offers a scathing critique of what he calls the
corporate greed and regulatory indifference that have attended
development of Canada’s vast oil patch. Mr. Nikiforuk spoke with Green
Inc. recently about how President Barack Obama, who has promised to
pursue energy independence for the United States and who is expected
to make a state visit to Canada later this month, might regard the tar
sands.
***
Do you expect the Obama administration to change in the way the oil
sands are regarded as a continental resource?
It’s not clear. George Bush and Dick Cheney saw the resource as a
pillar of economic activity and energy security for the United States.
But the tar sands have delivered neither security nor sustainability.
How [President Obama] deals with the rapid development of the tar
sands will pretty much indicate how serious he is about a switch to
alternative and renewable energies.
You talk about the oil sands as being a transitional resource to a low-
carbon economy. Do you think there’s any recognition of this notion in
the new administration?
There is among people like Henry Waxman, chairman of the energy
committee in the U.S. Congress. But, again there’s no indication the
Obama administration gets this point. There are two perspectives on
the oil sands. You have companies that want to make it the next Saudi
Arabia. The other is that it’s a transitional resource to a low-carbon
economy and to regard it as anything else is to drain the continent’s
financial resources.
What’s the impact of the current economy on the future development of
the oil sands?
The slowdown is quite phenomenal. We’re already looking at a
withdrawal of anywhere from $50 to $100 billion in capital at the
moment. It’s a fantastic opportunity for both the United States and
Canada to reassess the world’s largest energy project. There’s been
virtually no clear thinking about the project in Canada. It gives the
United States also an opportunity to say, O.K., we’re already addicted
to this resource to some degree. Much of the U.S. Midwest is already
running on bitumen. Do we want to extend this addiction and at what
cost? Or should we set other goals and say, one to two million barrels
of oil a day from the tar sands is all we really need to make the
transition?
Do you think the move towards national and possibly continental cap-
and-trade systems will further that goal?
I’m not quite sure. Cap-and-trade has had a checkered career in Europe
and it takes us away from the real focus, which is that maybe we
shouldn’t be making these emissions in the first place. Maybe we
should really be focusing on smart grids, electric cars and a whole
new approach to doing things. The problem with cap-and-trade and
programs such as carbon capture and storage is that they all assume
that business as usual can continue. The financial meltdown and peak
oil has pretty much demonstrated that business as usual’s not going to
work.
http://greeninc.blogs.nytimes.com/2009/02/09/qa-energy-independence-obam...
