Time to return to the plans of 2008 for Canadian oil refineries
By Bruce A Stewart
Do you remember 2008? Aside from oil prices rocking and rolling up to $147/barrel, it was a time when upwards of fourteen Canadian oil refineries and upgraders were planned to convert oil sands bitumen into traditional oil products.
That would be traditional petroleum products exactly like those that flow in the existing Kinder Morgan pipeline through BC to the terminal dock in Burnaby. Precisely the same stuff as flows in the existing Keystone pipeline to American markets. Just exactly the same things as flow eastward to Sarnia, Ontario.
Then came the discovery that “Value at Risk” — the financial sector’s measure of “success” — was flawed. Lehman Brothers collapsed, a number of other institutions were forcibly merged or given emergency aid, runs on banks had to be stopped and the global financial crisis slammed the brakes on the world economy.
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Down came the price of oil. Off the table went the upgraders and refineries.
Back in 2008, our Prime Minister, Stephen Harper, was making speeches about how Canada’s oil resources should benefit Canadians — with refining jobs. Funny, you don’t hear that pass his lips any longer.
Instead we seem hell-bent on simply exporting the jobs and minimally-processed bitumen (just enough dilution to push it through the pipeline) and the devil take Canadians’ future.
Not good enough, Prime Minister.
Marshall, Michigan tells you why. That’s the “Enbridge spill near Kalamazoo.” Ten times the damage to the Kalamazoo river watershed of a typical oil spill, ten times the cost to mitigate the effects.
That’s because diluted bitumen (dilbit, as it’s known in the trade) has a specific gravity far heavier than water, and sinks to the bottom, where it’s extremely difficult to clean up — unlike regular oil, which floats and can be given skimming and detergent treatments to clean it quickly and effectively.
No one likes a spill, but things happen: if you had to have one, which would you prefer?
BC’s objections to the Northern Gateway aren’t just because of the possibility of an on-the-ocean tanker accident — anyone honest knows that tankers pass by BC’s waters almost daily, going from Valdez, Alaska to California — or an in-a-river pipeline break as some 500 rivers are crossed from the Alberta border to tidewater.
Guess what … it’s the same for Keystone XL, when you dig into it.
No, it’s the noxious effects of dilbit compared to any other product — the pressures involved to move dilbit compared to other oils, especially in winter — and, oh yes, a recognition that we’re selling our own people out for a quick buck, something British Columbians in mill towns have a lot of experience with.
The answer is simple. The price tag of exploiting Canada’s oil sands has to be that the bitumen is processed into traditional petroleum products in Canada.
Sure, the oil companies will moan, scream, threaten to leave. It’s time for our politicians to grow a spine and say “don’t let the door hit you in the butt on the way out”.
As Beacon News publisher Markham Hislop has argued, CNOOC’s bid to buy Nexen gives us the perfect opportunity: approval should be contingent on the necessary upgrader and refinery being built and operated here.
It should be made clear that no pipelines to shovel dilbit to the Pacific will be approved, but pipelines moving traditional products (Kinder Morgan’s pipeline has been operational for fifty years without an incident, other than the one time a construction back-hoe punctured it … in Burnaby … doing municipally-authorized work, something the vocal mayor of Burnaby, Derek Corrigan, keeps forgetting to mention when he says “no pipelines to Burnaby”).
The world wants Canada’s petroleum products — and it’ll want more and more as other sources deplete. We can give them the jobs — or have them for ourselves — and transport the product in a much safer form by doing the refining here, to boot.
Harper was right four years ago, and is wrong now. Time to hold his feet to the fire.
Time for Redford and Co. to grow a backbone and stop rolling over and playing dead.
Time the oil companies learned that the rules are the same here as everywhere else: you get to profit on our terms and conditions.
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