Tag Archives: Energy East oil pipeline

Alberta’s possible pivot to the left alarms Canadian oil sector

Repost from Reuters

Alberta’s possible pivot to the left alarms Canadian oil sector

By Scott Haggett and Nia Williams, May 4, 2015 7:07am EDT
Alberta NDP Leader Rachel Notley meets with Mayor Naheed Nenshi in his office in Calgary, Alberta, April 30, 2015. REUTERS/Todd Korol

(Reuters: CALGARY, Alberta) – Canada’s oil-rich province of Alberta is on the cusp of electing a left-wing government that can make life harder for the energy industry with its plans to raise taxes, end support for key pipeline projects and seek a bigger cut of oil revenues.

Polls suggest Tuesday’s election is set to end the Conservative’s 44-year reign in the province that boasts the world’s third-largest proven oil reserves and now faces recession because of the slide in crude prices.

Surveys have proven wrong in Canadian provincial elections before and voters may end up merely downgrading the Conservatives’ grip on power to a minority government.

Yet the meteoric rise of the New Democratic Party and the way it already challenges the status-quo of close ties between the industry and the ruling establishment has alarmed oil executives. The proposed review of royalties oil and gas companies pay the government for using natural resources and which could lead to higher levies, is a matter of particular concern.

“Now is not the time for a review of oil and natural gas royalties,” Tim McMillan, president of the Canadian Association of Petroleum Producers, the country’s top oil lobby, said in a statement.

A 2007 increase in the levy was rolled back when the global financial crisis struck and oil executives say today the time is equally bad to try it again.

Yet the left’s leader Rachel Notley, a former union activist and law school graduate, has shot up in popularity ratings in the past months advocating policies that have been anathema for many conservative administrations.

She says she would not lobby on behalf of TransCanada Corp’s controversial Keystone XL pipeline or support building of Enbridge Inc’s Northern Gateway pipeline to link the province’s oil sands with a Pacific port in British Columbia. Citing heavy resistance from aboriginal groups to the Enbridge line, Notley says Alberta should back those that are more realistic such as TransCanada’s Energy East pipeline to the Atlantic ocean.

PACKING UP?

Notley also advocates a 2 percentage point rise in Alberta’s corporate tax rate to 12 percent to shore up its budget that is expected to swing from a surplus to a C$5 billion deficit in 2015/2016 as energy-related royalty payments and tax revenues shrink.

Even with the proposed corporate tax hike Alberta’s overall taxes would remain the lowest nationally. Oil executives warn, however, that any new burdens at a time when the industry is in a downturn, shedding jobs and cutting spending, could prompt firms to move corporate head offices out of the province.

“Business is mobile,” said Adam Legge, president of the Chamber of Commerce in Calgary where most of Canada’s oil industry is based. “Capital, people and companies move.”

Ironically, the challenge the oil industry and the Conservatives face is in part a by-product of Alberta’s rapid growth fueled by the oil-sands boom.

The influx of immigrants from other parts of Canada and overseas has changed the once overwhelmingly white and rural province. Today Alberta is one of the youngest provinces and polls show younger and more diverse population is more likely to support left-wing causes such as environment and education and more critical of big business. The New Democratic Party still only got 10 percent of the votes in the 2012 vote, but an election of a Muslim politician as a mayor of Calgary in 2010 served as an early sign of the changing political landscape.

The Conservatives themselves and their gaffe-prone leader Premier Jim Prentice also share the blame for the reversal of fortunes with one poll showing them trailing the left by 21 percent to 44 percent.

Prentice angered voters when he told Albertans to “look in the mirror” to find reasons for the province’s fiscal woes and then passed a budget in March that raised individual taxes and fees for government services but spared corporations.

Scandals – Prentice’ s predecessor left last year because of a controversy over lavish spending – and blunders added to the party’s woes.

The NDP vaulted to the top of the polls after Notley’s strong performance in an April 23 televised debate, when Prentice, former investment banker, drew fire for suggesting his rival struggled with math.

Then there is voter fatigue with a party seen as too comfortable and scandal-prone after decades in power.

“It’s still the same gang, the same policy, same procedures, the same concept of entitlement,” said one executive at a large oil and gas producer who declined to be named because he is not authorized to talk to the media. “I know some extremely neo-conservative guys who have said enough is enough.”

(Additional reporting by Julie Gordon in Vancouver and Mike De Souza in Ottawa; Editing by Amran Abocar and Tomasz Janowski)
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    NRDC Attorney: The tar sands invasion that can be stopped

    Repost from NRDC Switchboard, Danielle Droitsch’s Blog

    The tar sands invasion that can be stopped

    Danielle Droitsch
    Danielle Droitsch, senior attorney with NRDC, Canada Project Director, International Program.

    By Danielle Droitsch, April 28, 2015

    Many across the United States are aware of the tar sands threat posed by the proposed Keystone XL pipeline but what many may not know is the U.S. faces a looming threat that is bigger than just this one pipeline. We call it a tar sands invasion. The plan would be to complete a network of pipelines (both new and expanded), supertankers and barges, and a fleet of explosive railway tank cars. What is at risk? San Francisco Bay, Puget Sound, the Great Lakes, the Hudson River and other places we all call home. While the threat of this invasion is already here with the proposed Keystone XL pipeline, the good news is that citizens across North America are rising up to respond and repeal the assault with a clear message: Not by pipeline, not by rail, not by tanker. The good news is that public opposition to tar sands oil is rising and projects like Keystone XL and Northern Gateway have been delayed. The tar sands assault is not inevitable. In fact, the U.S. doesn’t need this dirty form of fuel and neither does Canada. The time has come to limit tar sands expansion in favor of a cleaner and brighter energy future.

    Tar Sands Invasion Map 4-27-15.jpg

    A new report released by NRDC reveals that the amount of tar sands crude moving into and through the North American West Coast could increase by more than 1.7 million barrels per day if industry proposals for pipelines, tankers and rail facilities move forward. For more information about this new information see posts by my colleagues Anthony Swift and Josh Axelrod. Why the west coast? With the majority of the world’s heavy oil refinery capacity, the United States including the west coast is a critical market for the tar sands industry. To be clear, Keystone XL still remains at the heart of the industry plan to expand tar sands and gain access to the global market. But industry is still pushing hard for other ways to expand especially as KXL flounders. It is important to keep in mind the tar sands industry – which currently produces about 2 million barrels per day (bpd) – plans to triple production to exceed 6 million bpd in the next fifteen years. The oil industry has made clear it needs all of its rail and pipeline proposals to achieve its massive production goals.

    We know that the tar sands industry and Canadian government has long had a plan to quadruple or more tar sands extraction in Canada. KXL has always been a huge part of that. But it is now very clear that they also plan to access the U.S. and global market through every means possible.

    This threatened invasion puts our communities, waters, air and climate in jeopardy. The Tar Sands Solutions Network has done an outstanding job outlining many of the different campaigns that are emerging across North America. This plan threatens to expose communities from California to New York to health, safety and environmental risks unless the public rallies to stop it. Here are some of the specific impacts that North America faces as a result of the tar sands invasion:

    • Across the West Coast, tar sands laden tanker and barge traffic could increase twenty-five fold, with a projected 2,000 vessels along the Pacific West Coast– including the Salish Sea and the Columbia River–shipping nearly two million barrels of tar sands crude every day.
    • A dozen proposed rail terminals would substantially increase tar sands by rail traffic going through densely populated American citizens like Los Angeles and Albany New York risking explosive derailments of hazardous crude unit trains
    • Nearly a million barrels of tar sands would be destined for California and Washington refineries, exposing fenceline communities in Anacortes, San Francisco and Los Angeles to increasing toxic air pollution.
    • In the Midwest, the pipeline company Enbridge is moving to nearly double the flow of tar sands moving through the Great Lakes region, an area that already has suffered from a 2010 spill of more than 800,000 gallons of the tar sands into the Kalamazoo River in Michigan sending hundreds of residents to the hospital. Four years later, the cleanup, which has cost more than $1 billion, is still unfinished.
    • On the East Coast, the tar sands industry is seeking to build the Energy East pipeline across Canada. The pipeline would run from Alberta east across Canada to New Brunswick and Quebec, carry 1.1 million barrels of tar sands oil per day and require hundreds of oil tankers traveling along the East Coast and Gulf Coast annually, through critical habitat of the extremely endangered Right Whale.
    • In Albany, New York, a proposed oil transfer facility could lead to the shipment of tar sands oil on barges down the Hudson River or rail cars along the river destined for facilities in the New Jersey and Philadelphia areas.
    • In Maine, Vermont, and New Hampshire, the constant threat of a proposed reversal of the aging Portland-Montreal Pipeline is likely to arise again as Enbridge completes work on a pipeline reversal that will connect the tar sands directly to Montreal this summer.
    • This network of pipelines will feed refineries that produce millions of tons of hazardous petroleum coke waste – known as “petcoke” – which are piling up in residential neighborhoods like Chicago.
    • In Canada, pipeline companies are trying to access the west and east costs with pipeline proposals that would ship the heavy tar sands oil across pristine landscapes in British Columbia or across the Prairies into Ontario and Quebec. Communities are raising concerns about the threat of a spill to waters from the pipeline or tankers leaving the Bay of Fundy of the Gulf of St. Lawrence.
    • And last but not least, communities in Alberta at ground zero have been facing the enormous consequences of tar sands development which has brought about significant contamination of water, air, and land. Increasingly, there are calls for a moratorium on development.

    Targeting at risk communities

    The tar sands invasion puts a high toll on low-income and aboriginal communities located in railway corridors, near oil refineries, and next to petcoke waste sites. In refinery fence-line communities, emissions associated with tar sands are suspected to be even more detrimental to human health than existing harmful emissions from conventional crude. Derailments of tar sands unit trains – mile long trains carrying over a hundred tankers full of explosive tar sands crude – pose a catastrophic risk for communities throughout the country. And as more tar sands oil is refined in the United States, the public will also face increased health and environmental risks from massive piles of petroleum coke, a coal-like waste full of heavy metals that results from tar sands oil refining and can cause serious damage to the respiratory system.

    Industry would like for you to believe that tar sands development is inevitable and there is nothing that can be done. Wherever they turn today they are being faced with public opposition. Expansion is not inevitable, especially because of this growing and formidable opposition.

    A climate problem

    It is clear that tar sands reserves – some of the world’s most carbon intensive – are at the top of the list of reserves that must remain in the ground. Mounting scientific and economic analysis shows that the tar sands industry’s proposed expansion plan is incompatible with global efforts to address climate change. The Intergovernmental Panel on Climate Change (IPCC) concludes that 75% or more of discovered fossil fuel reserves must remain in the ground in order to limit warming to the international two degrees Celsius goal. The clear inconsistency between tar sands expansion and efforts to address climate change have made opposition to tar sands expansion projects a clear rallying point for a broad group of allies advocating for action on climate.

    A water problem

    A tar sands spill from train, pipeline, or tanker could devastate local economies, pristine wilderness, harm human health, and lead to an especially costly and challenging cleanup. Tar sands spills have proven more damaging than conventional spills, as heavy tar sands bitumen sinks below the water surface making it difficult to contain or recover. A spill from shipping the tar sands crude could devastate communities, contaminate freshwater supplies or marine habitats and damaging local economies.

    Undermining efforts to grow our clean energy economy

    The growing exploitation of Alberta’s tar sands threatens to undermine North American efforts to build a clean energy economy and combat global climate change. Because most tar sands crude is destined for the United States, its expansion would create a greater dependence on the world’s dirtiest crude oil and undermine our transition to environmentally sustainable energy and a cleaner transportation fleet. Responding to the tar sands invasion will require solutions reduce fossil fuel use and spur low-carbon transportation and energy solutions such as broadened electric vehicle use and development of renewable and clean fuels.

    This tar sands invasion can be stopped: Clean Transportation Solutions

    The good news is this tar sands invasion can be stopped starting with leadership from government officials to embrace climate and sustainable transportation solutions. NRDC’s report for the west coast outlines detailed recommendations for decision-makers at all levels. The first step is for decision-makers at all levels to become familiar with the unique issues associated with tar sands oil and then to actively identify the full range of solutions to confront this problem. Without action, the U.S. will unintentionally become a thoroughfare for this oil undermining climate policies and presenting risks to communities and water. With support for regional clean energy policies, we can prevent the influx of tar sands crude and build the green infrastructure and public support necessary to begin transitioning to a clean energy economy.

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      Recent Grassroots Victories: Standing Against Big Oil’s Crude-by-Rail Push

      Repost from NRDC Switchboard

      Standing Against Big Oil’s Crude-by-Rail Push

      By Franz Matzner, April 6, 2015

      Franz MatznerOver the last few days, we’ve seen a series of grassroots victories that prove we’re not stuck with Big Oil’s plan to foist dangerous fossil fuel infrastructure on communities across the country.

      Oil Train Fire.jpg
      A March 5, 2015, oil train derailment on the banks of the Galena River in Illinois. (Environmental Protection Agency)

      Just last week, TransCanada (of Keystone XL infamy) confirmed that it is dropping a marine crude oil export terminal in Quebec due to environmental concerns, a move that will delay the target opening date for the massive Energy East tar sands pipeline by at least two years.

      Across the continent, Big Oil was also dealt two blows against its attempts to import extreme crudes into California by rail. In the face of strong community opposition, midstream oil company WesPac has abandoned its plan to build a rail terminal that would have brought dirty crude oil into the San Francisco Bay Area.

      A few years ago, WesPac proposed a rail and marine terminal that would transport 242,000 barrels per day of crude oil–nearly a third of the capacity of Keystone XL–through Pittsburg, CA, a small community of 60,000 residents and then on to Bay Area refineries. The problems with WesPac’s proposal are myriad: it would expose Pittsburg’s population, largely communities of color and low-income communities, to the risks of exploding trains and increased air pollution, and it would require a massive investment in fossil fuel infrastructure at a time when we should be moving toward clean energy solutions.

      The project was so ill-conceived that, following comments by NRDC and others, the California Attorney General wrote a letter finding “significant legal problems” with the project’s environmental review documents. Accordingly, the city decided to put the project on hold and revisit its environmental review process. That’s where things stood for over a year, until last week, when WesPac announced that it would drop the rail terminal aspect of the project altogether.

      As community and environmental advocates have repeatedly pointed out, oil trains pose serious risks–risks that were highlighted by a series of fiery accidents over the last few weeks. (Notably, some recent accidents have involved Canadian tar sands crude, in addition to a bevy of dangerous mishaps involving North Dakota’s Bakken crude, which has long been known to be highly volatile and has been the culprit in most oil train disasters.)

      This win in Pittsburg follows a recent decision by another Bay Area city, Benicia, to withdraw and revise its environmental review documents for a proposed crude-by-rail terminal at Valero’s Benicia refinery. As NRDC and others, including the California Attorney General, pointed out in legal comments, the terminal would pose serious safety and health threats to Benicia and to residents along the rail line. Momentum is also building against another crude-by-rail proposal up for consideration further south in San Luis Obispo County.

      These victories show the power of local communities to stop Big Oil in its tracks.

      The battle, however, is far from over: Valero is still trying to push forward with its rail terminal, and WesPac’s proposed marine terminal would have significant impacts on the fragile San Francisco Bay Delta and nearby residents. In fact, WesPac’s plans may still include the renovation of long-dormant storage tanks to stockpile large volumes of volatile crude oil, even though those tanks are literally a stone’s throw from homes, churches, and a school.

      Train Map.jpg
      The proposed WesPac project. (Draft Recirculated Environmental Impact Report, Figure 2-2)

      Some critics have used the boom in crude oil trains as evidence that we should allow more pipelines. They offer the false choice of risk from pipelines or risk from oil trains. The truth is more sinister. Big Oil wants more of both. Pipelines and rail serve different geographic areas and often carry different types of oil. The problem is that both forms of transportation have risks, and both bring fossil fuels perilously close to our communities. Clean energy investments do the opposite: they eliminate the dangerous risks of spills and bomb trains, while cutting carbon pollution.

      It’s time our elected leaders follow the example of communities across the country by saying “no” to Big Oil and “yes” to clean solutions that accelerate fuel efficiency, electric vehicles, clean fuels, and renewable energy such as solar and wind.

      Franz A. Matzner is associate director of government affairs for the Natural Resources Defense Council. His policy background includes energy, climate, and forestry. He previously held the position of senior policy analyst for agriculture and the environment at Taxpayers for Common Sense (TCS). Matzner graduated Phi Beta Kappa from the University of Pennsylvania. He is co-author of the NRDC report “Safe At Home: Making the Federal Fire Safety Budget Work for Communities.”
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        Gogama derailment – 35 oil tanker cars go off rails — 5 of them into the Makami River

        Repost from CBC News

        Gogama derailment – 35 oil tanker cars go off rails — 5 of them into the Makami River

        Mar 08, 2015 6:14 PM ET

        As crews continued to tackle a fire Sunday set off after 35 CN Rail cars carrying oil went off the tracks just outside of Gogama, Ont., the province’s transportation minister and his caucus colleague went after the federal government for its rail safety record.​

        “The federal government, responsible for rail safety, must do more to protect our communities and the environment,” tweeted Glenn Thibeault, Liberal MPP for Sudbury and parliamentary assistant to Ontario’s environment minister.

        “The rail cars involved are new models, compliant with the latest federal regulations. Yet they still failed to prevent this incident,” Thibeault said in a statement.

        Gogama Train Derailment 2
        Five of the oil tankers are in the Makami River, four kilometres outside of Gogama. This is the third CN derailment in northern Ontario in less than a month, (@GlennThibeault/Twitter)

        ​CN Rail has confirmed that five of the 35 tanker cars that detailed are in Makami River, which is part of the Mattagami River System. The train was 94 cars long and all were tanker cars carrying crude oil from Alberta.

        Firefighters are working to control the flames and smoke from the burning oil tankers, about four kilometres outside of Gogama.

        This is the third CN derailment in northern Ontario in less than a month, and the second in the same area. Crews are still working to clean up a similarly fiery derailment near the community just three weeks ago.

        That prompted Ontario Transportation Minister Steven Del Duca to say in a statement Sunday that he “will be contacting Federal Transport Minister Lisa Raitt, CN and CP this week to reiterate our government’s serious concerns with respect to ensuring our railways are safe.”

        There’s no sign that drinking water or air quality near the site of the train derailment have been affected, according to CN Rail’s latest update Sunday afternoon.

        The company has launched its emergency response plan, bringing in experts in engineering, operating, environment and dangerous goods. CN crews have already started constructing a 460-metre stretch of bypass track to divert around the derailment site.

        Chief operating officer Jim Vena apologized to local residents for the disruption caused by the derailment, adding that he is heading to the scene.

        ‘Very hard to accept’

        Rick Duguay, who runs Gogama’s general store, woke early Saturday morning to what he described as a strange banging noise. Duguay has lived in the community his entire and is accustomed to the sound of trains, but said this sound was different.

        He’s relieved the derailment happened outside of town.

        “Luckily it’s not right here at the railroad crossing, but it’s close enough and very hard to accept the things going on,” Duguay said.

        He wants to see changes put in place to make railroads safer, but doesn’t think the two recent crashes are enough to prompt change.

        “The worry was always there that a train wreck could happen in town … but I mean, we lived with it all our life.”

        Morris Neveau said the two derailments so close together have left many in the Mattagami First Nation, just downstream from the recent derailment, unnerved.

        “It affects our thinking and how we live, you know, because we live in fear, eh?”

        ‘What can we do now?’

        Gogama residents spent much of the weekend looking up at the large plume of black smoke looming over the town.

        Gogama Train Derailment
        CN says indications are that ‘the drinking water supply to Gogama Village and the nearby First Nation are not affected at this time.’ (@GlennThibeault/Twitter)

        Dawn Simoneau, 33, said her two daughters have been asking questions about the derailment.

        “Like, ‘Are the fish going to be okay?’ and they are concerned as well,” said  .

        Simoneau, a life-long Gogama resident, has lived her entire life with trains rumbling past and an ever-present fear that something might happen.

        “This is just always the way it’s been. And now … we’re thinking, ‘What can we do now to make sure this doesn’t happen again?'”

        The derailment has some residents talking about the Energy East oil pipeline, which has faced opposition in other parts of northern Ontario.

        Nickel Belt New Democrat MP Claude Gravelle said he didn’t want to get into that debate while visiting Gogama on Saturday.

        “Well, that’s a different discussion for a different day, but there certainly are some concerns about pipelines. But there are concerns about rail cars. What’s the safest? Accidents are accidents.”

        The intense heat of the fire has kept investigators away from the site so far, but investigators hope to find some answers Sunday about how much oil was spilled and what caused the derailment.

        With files from The Canadian Press
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