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What Role Should the Canadian Oil Sands Play in the World Energy Mix?

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One of the key questions of our time is this: "What role should the Canadian oil sands play in the world energy mix?" Whenever thoughtful observers begin to answer such a seemingly straightforward question, they are instantaneously ensnared in such a spider web of issues that it is nearly impossible for them to frame a comprehensive, yet concise, response. That fact alone should alert us to the reality that we are engaging in a debate that is anchored in a cascading hierarchy of competing values.

If, for example, one considers market forces alone then one is likely to respond quite enthusiastically by predicting a golden future for oil sands production. An ever-increasing appetite for cars, trucks and various levels of manufacturing activities in Asia and other parts of the world will definitely create a convincing demand for more and more gasoline, diesel and fuel oil. The Canadian oil sands can easily feed that demand. We can even do so with some justification -- Canada is, after all, a relatively secure, stable and respectable oil-producing jurisdiction. In addition, for many Canadians the oil sands are an important source of income to both individuals and commercial concerns from one side of the country to the other. So, from a purely economic point of view, we can happily say the oil sands should play a significant role in supplying the world's energy requirements for decades to come.

But economics is never the only point of view thoughtful Canadian and other observers bring to bear when we debate the future of the oil sands. A spokesperson for the UK Tar Sands Network perhaps said it best not long ago when she told the Petroleum Economist that the oil sands issue "isn't as black and white as we thought."

First there is the question of responsibility for immediate local health and environmental consequences to oil sands development. Secondly, we have a responsibility to future generations -- can the environmental consequences be sufficiently mitigated so as to leave fully functioning ecosystems behind once the developments are finished? Thirdly, what is the extent of our responsibility for global consequences? Are we entitled to deny the benefit of our resources to people aspiring to a higher standard of living in other parts of the world or can we find a way to deliver the resource in a manner that does not unduly burden the planet with additional greenhouse gas emissions?

Albertans are slowly coming to terms with the complexity of all these issues, and beginning to take significant steps towards finding a judicious balance between resource development and long-term impacts. The Alberta government has dedicated $2 billion to funding carbon capture and storage projects, for instance; initiated another multi-million dollar fund devoted to perfecting new and greener energy technologies and practices; and actively supports Carbon Management Canada, a university-led research network of excellence focused on a clean energy future.

Nevertheless, we need to know a lot more before we can honestly conclude that we have discharged all of our responsibilities well enough to justify a long term role for the oil sands in the world's energy mix. As things stand now, we simply do not know enough to be able to form a definitive answer.

Happily, the Royal Society of Canada has given us a roadmap outlining precisely what we do know and, more importantly, what we still need to learn. Its expert panel (led by Dr. Steve Hrudey, a well-respected scientist at the University of Alberta) issued their exhaustive review of environmental and health impacts of the oil sands last December. Their 438 page report is the best I've seen on this subject -- it deals with the issues clearly, objectively and without hyperbole, giving us all a much needed beacon for establishing a research agenda.

Both the federal and the provincial governments would do well to take the advice given by Dr. Hrudey and his expert team. Instead, we seem to be witnessing a political game of "oneupmanship." Mr. Peter Kent, Minister of Environment at the federal level, recently rushed to press with a monitoring scheme he prematurely declared would restore Canada's reputation around the world. Even the world's leading water scientist, Dr. David Schindler (also of the University of Alberta) felt the minister went too fast. Surely he could have waited to collaborate with the Alberta minister, Mr. Rob Renner, who is currently considering the results of his own expert panel on matters relating to a world class environmental and health monitoring system.

Alberta's panel, which reported out in June this year, has advocated setting up an arm's length, stand alone Environmental Monitoring Commission that would ensure a state of the art data collection system and a transparent reporting system that would allow public access to all data. This regime, coupled with the research agenda set out by the Royal Society of Canada, would put us on the right path to answering the question of whether we can responsibly develop the oil sands over the long term.

In the near term, the oil sands will no doubt continue to play a role in the world's energy mix, if only to supply Canada and the US. If we can figure out how to bring the resource to a broader market in a responsible manner, then I believe the oil sands will play an expanded role. If not, Canada will run out of willing customers long before we run out of product to sell from the world's second largest oil reserves.

Elaine McCoy has been sitting in the Senate as an independent Progressive Conservative Senator from Alberta since 2005. She previously worked as a lawyer and was the former Labour Minister in Alberta's Getty government. She regularly blogs about her experiences in Ottawa at www.albertasenator.ca

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