In his efforts to advance TransCanada’s bid for the proposed Keystone XL pipeline, that will carry 700,000 barrels of oilsands oil from Hardisty, Alberta to refineries in the Gulf of Mexico, Natural Resources Minister Joe Oliver has travelled to Washington six times. During his most recent trip he resorted to “desperate and false arguments” to sell the project according to Robyn Allan, former President and CEO of the Insurance Corporation of British Columbia.

In a recent piece for the Vancouver Observer, Allan writes Oliver’s “eagerness” has led him to make misleading claims about the significance of the pipeline to energy security – for both the U.S. and Canada – job security and the environment.

During his November 6th trip Oliver claimed “the approval of Keystone XL would enhance energy security, create thousands of jobs and support the environment. Approval would displace oil from Venezuela which has repeatedly threatened to cut off its supply to the United States and has the same or higher emissions as the oil sands, with less stringent regulations.”

As Allan points out, the Keystone XL would only account for a portion of imported oil to the U.S., accounting for only six percent of U.S. imports.

However, that amount of oil, if upgraded domestically and shipped to the east coast of Canada (which currently imports oil from other countries), could potentially be significant in terms of Canadian energy security.

So, to the claim of U.S. energy security, Minister Oliver is off the mark.

Allan claims that the argument for job security is equally misleading. Even President Obama took issue with claims the pipeline would create thousands of jobs in an interview with the New York Times.

He said, “Republicans have said that this would be a big jobs generator,” but “there is no evidence that that’s true. The most realistic estimates are this might create maybe 2,000 job during the construction of the pipeline, which might take a year or two, and then after that we’re talking about somewhere between 50 and 100 jobs in an economy of 150 million working people.”

The export of diluted bitumen from Canada, says Allan only guarantees Canadians will lose out on upgrading and refining jobs.  “Diluted bitumen shipped to the Gulf Coast means upgrading and refining oil sands crude does not take place in Alberta – it takes place in the U.S. So we can be assured Keystone XL actually represents thousands of jobs lost to Canada.”

When it comes to environment, Minister Oliver bases his reasoning that Keystone XL will “support the environment” on the claim that Venezuelan oil has the same or higher emissions as the oil sands but without a strong set of regulations to guide production.

Allan breaks down the claim this way: for the pipeline to actually benefit the environment, oilsands oil emissions would have to be lower than Venezuelan oil emissions, be capable of displacing Venezuelan oil, and Venezuelan oil not imported would need to remain unexploited.

To clarify on the first point, Allan reached out to Minister Oliver’s office but could not get a response.

Allan would be right in assuming that oilsands represent Canada’s fastest growing source of greenhouse gas emissions and that Alberta, due to industry, accounts for 49 per cent of Canada’s total emissions.

Without a strict basis for comparison, however, Allan takes an extremely favourable position – that Venezuelan crude has higher emissions than Albertan oil. But that assumption only propels Allan to ask the next question. Could oilsands bitumen displace Venezuelan crude in the U.S. market?

As Allan explains, this is extremely unlikely. Venezuelan oil is produced by a state-owned company Petróleos de Venezuela South America (PDVSA). PDVSA owns and controls three “captive” refineries in the U.S. which are supplied with a guaranteed feed of Venezuelan oil. Even if Canada could displace the Venezuelan crude supplying these Venezuelan-owned refineries, Venezuela would need to agree to halt production of an equal amount of oil from its reserves to allow for the ‘displacement’ of that oil.

This would amount to the shutting down of 40 percent of Venezuela’s resource sector.

Allan writes, “Mr. Oliver’s claim that Keystone XL would enhance energy security, create thousands of jobs and support the environment is wrong. For many of us concerned about adding value to our non-renewable resources, meaningful and long term jobs for Canadians, global warming and climate change, his brazen misrepresentations are insulting.”

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This is part 2 in a series. For part 1, click here.

Hugo Chávez first stormed the spotlight in Venezuela as the leader of an unsuccessful coup attempt against the government of President Carlos Andrés Pérez in 1992. Realizing that the coup had failed, Chávez admitted defeat on national television, famously vowing to try again before being shipped off to prison.

According to the ethical oil version of history, the story essentially stops here: an aspiring dictator attempts to seize power and fuel his despotic rule with ill-gotten oil money. Though Chávez would only take office in 1999 in democratic elections, he wore the authoritarian label until the end of his days. As usual, however, reality is more complex than the Canadian oil lobby would have you believe.

Venezuela before Chávez was a country marred by corruption, poverty and institutional decay, administered by a two-party oligarchy that took turns in power. Long kept afloat by oil revenues, the economy went into crisis in the 1980s as petroleum prices fell. President Pérez responded in 1989 by reversing his election promises and enacting IMF-mandated market reforms, including a wave of mass privatizations and the removal of crucial food and fuel subsidies. During the resulting rioting among the urban poor, Pérez called in the army, killing over 3,000 civilians in what came to be known as the Caracazo massacre.

Chávez emerged as a leader out of the turmoil of Caracazo and the Venezuelan resistance movement against austerity. Privatization and market reforms have a long and ignoble history on the South American continent; they tend to be imposed through the barrel of a gun.

From Pinochet’s bloody 1973 coup in Chile to the Argentinian military junta, violent state repression has often been used to accomplish what democracy could not: the elimination of social protections and the selling off of state assets to foreign investors.

After his election in 1999, Chávez sought to chart a different course for Venezuela, and he began by calling a constituent assembly to create a new constitution. The constitutional process, which incorporated indigenous groups, women’s rights advocates and urban social movements, produced an ambitious document that was approved by nearly 80 percent of the population in a referendum.

The drafting of the new constitution began a contradictory process that would define Chávez’s presidency. One the one hand, new mechanisms for direct democracy alongside commitments to health care, education and welfare empowered millions of deeply impoverished Venezuelans formerly shut out of politics. On the other hand, the staunch opposition of the oligarchy, supported by anti-Chávez media both at home and abroad, meant that Chávez often resorted to moves like stacking the judiciary in order to maintain his power in office.

Many of the programs implemented under Chávez were innovative attempts at addressing long-entrenched social problems. He created a vast series of reforms called Bolivarian Missions that opened free medical clinics, massively expanded social housing, improved literacy rates and worked to reform land rights and establish food sovereignty.

While these social programs are routinely dismissed as mere patronage handed out by an oil-soaked populist, they functioned as genuine forums for direct democracy, empowering citizens to make decisions about the best uses of government funds through local debate. These programs were not all successful, nor were they able to transform Venezuelan society overnight. But for those they reached, the Bolivarian Missions made a big difference in their lives.   

Like all petro-states, Venezuela is a nation whose politics are defined by its most valuable commodity.

Yet while the petro-states of the Middle East have used their oil wealth to enrich a tiny elite and build vast monuments to unsustainable affluence (e.g., Dubai’s indoor ski resort), Venezuela under Chávez used its control of the nationalized oil industry to make meaningful improvements in the lives of its poorest citizens.

Since Chávez was first elected president in 1999, poverty has fallen from 42.8 percent of households to 26.7 percent, and extreme poverty has declined from 16.6 percent to 7.0 percent. The Gini coefficient, a measurement of wealth inequality, has fallen from 0.469 to 0.39, a drop that makes Venezuela’s income distribution the most equal in Latin America.

The routine demonization of Chávez by his ideological opponents, including the ethical oil camp, doesn’t stand up to scrutiny.

Dismissed as an elected dictator, Chávez repeatedly won re-election in polls that Former US President Jimmy Carter has rated as the freest and fairest in the world. Accused of taking over the media and silencing his critics, Chávez’s state-run broadcaster actually commands a mere 5-8 percent of market share.

The corporate media, by contrast, is staunchly opposed to his redistributive policies, and played a key role in fomenting a coup attempt against him in 2002. That coup was only stopped when hundreds of thousands of Chávez supporters took to the streets demanding the president’s return to office.

Venezuela under Chávez was no socialist paradise, and the road ahead for the country will be difficult. It faces high rates of violent crime, rising inflation and diminished revenues from oil production—not to mention deep ideological divisions over the future of the country.

But neither was Chávez’s Venezuela the embodiment of evil that Ezra Levant would have us believe.

No matter how you evaluate Chávez’s legacy, he can no longer function as the cartoon villain that legitimizes the tar sands.

Canada is facing a series of stark choices about its energy future. The choice is not between green, friendly Canadian bitumen and the tar of tyrants. Oil markets make those decisions without a single thought for ethics. If we’re going to face up to the reality of climate change, it’s time to stop pointing fingers abroad.

Image Credit: Wikimedia Commons

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This post is the first in a two-part series. For Part 2, click here.

In death as in life, Venezuela’s President Hugo Chávez has provoked more than his fair share of criticism and commentary in Canada. When the elected socialist leader died on March 5th after a two-year struggle with cancer, Canadians were quick to offer their condolences—with varying degrees of tact.

Former Prime Minister Jean Chrétien reminisced about Chávez’s fondness for baseball, and noted his frank willingness to criticize the United States. NDP member of Parliament Paul Dewar extended his sympathies to the Chávez family and affirmed the ongoing relationship between Canada and Venezuela.

At the current Prime Minister’s Office, Stephen Harper painted Chávez’s death as an opportunity for the people of Venezuela to “build for themselves a better, brighter future based on the principles of freedom, democracy, the rule of law and respect for human rights.” This statement drew a formal complaint from the Venezuelan government, criticizing Harper for making “insensitive and impertinent statements” while the country grieves. 

Harper had long considered Chávez to be an ideological opponent and an obstacle to progress in the Western Hemisphere, feelings he made clear in a 2009 Postmedia News interview before the Summit of the Americas. During the interview, Harper described Chávez as the leader of “an authoritarian state run on petro dollars” who was “opposed to basically sound economic policies.”

In less enlightened quarters of Canadian politics, responses to the Venezuelan President’s death were not nearly so measured. From Sun Media’s charming correspondent Ezra Levant, Chávez earned himself three words: “burn in hell.” 

Why does the death of Chávez mark the beginning of a new, brighter era in the mind of Prime Minister Stephen Harper, and the start of an eternity of torment according to Ezra Levant? The answer might have something to do with oil.

Venezuela is a petro-state that sits on the largest known oil reserves in the world: 17.9 percent, compared to Saudi Arabia’s 16.1 percent and Canada’s 11 percent. But despite the country’s vast reserves, current production sits at only 3.5 percent of global output. Low production rates and limited exploration of new fields have been attributed to the mismanagement of Venezuela’s national oil company, PDVSA.

Immediately following Chávez’s death, speculation began about the prospects for international investors seeking to reenter Venezuela’s nationalized energy sector—a development that could mean increased competition for producers in Alberta’s tar sands.

But for proponents of the tar sands, Venezuela is more than just competition; it’s a key selling point for Canadian oil. As the now-familiar refrain of the Ethical Oil Institute goes, Canada’s oil is ethical, while the oil produced in countries like Venezuela is ethically-compromised conflict oil. The worse Chávez looks, the better the Canadian alternative.

Ethical oil is a made-in-Canada campaign developed to distract the attention of Canadians away from the tar sands by pointing fingers abroad. But as the planned pipeline shipment of Alberta bitumen to refineries in the United States becomes increasingly contentious south of the border, the campaign is finding new life as a popular export product. Gary Doer, Canada’s Ambassador to the US, recently rolled out the ethical oil talking points to help galvanize support for the Keystone XL pipeline in the United States.

For Doer, the choice is a clear one: either we support the heinous Hugo Chávez or Alberta Premier Alison Redford. The demonization of Hugo Chávez has long been a feature of the ethical oil sales campaign, reinforced in no small measure by the international media. With Chávez gone and the future of Venezuela uncertain, it’s worth taking a closer look at his legacy to see if the former president deserves to live on as an accidental salesman for Canadian oil. 

Image Credit: que comunismo via flickr.

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We’ve heard it all before: get your oil from Canada, or get it from the devil.

Okay, well, maybe not the devil, but if you aren’t dealing with Canada, you’re dealing with despots, tyrants, oppressors of women and suppressors of democracy.

This is the pervasive pseudo-logic brought to us by conservative commentator and Sun News correspondent Ezra Levant. In his book Ethical Oil, which eventually grew into the Ethical Oil Institute, Levant poses Canadians with a false dichotomy: either we support Canada’s ethical oil – which is democratically developed in an environmentally responsible way – or we support conflict oil.

The argument is a classical for-or-against proposition meant to polarize Canadians on a complex issue. And it is Canada’s latest export to America.

In the current media volley between American and Canadian leaders on President Obama’s upcoming decision to either approve or deny the Keystone XL pipeline border crossing, this deceptive ‘you’re either with us, or you’re with the terrorists’ argument is on the loose, begging the overall question: is Canada taking its talking points straight out of the Ethical Oil playbook?

Let’s begin with Canada’s Ambassador to the US – Gary Doer. During the February 17th Forward on Climate rally in Washington DC – the largest climate change rally in US history – Doer claimed protestors lacked “logic.”

The ‘outspoken minority’ who oppose the Keystone XL, said Doer, don’t express American wishes; they just happen to get more media attention than the “65 percent of Americans that prefer to get their oil from Canada rather than Venezuela or the Middle East.”

Doer followed up with an interview this week with Postmedia News where he posed the issue this way: “If you ask the question: Do you want your oil from Hugo Chavez or Alison Redford, I think I know the answer.”

“If you look at the fundamental criteria for presidential legacies,” Doer said, commenting on the idea that Keystone XL is Obama’s legacy issue, “it’s peace and prosperity.”


“I would argue that that means less reliance on Middle Eastern oil and more jobs building the independence here in North America.”

Doer’s sentiments were echoed this week by Alberta Premier Alison Redford whose column in USA Today stressed “Alberta is the safest, most secure and responsible energy supplier to the US.”

“The same cannot be said for the other foreign countries and regimes that currently feed US energy demand.”

Levant himself has been somewhat more forthcoming with his thoughts on the subject, claiming nearly one year ago that the Keystone XL is “a pretty straight swap of Canadian ethical oil for Venezuelan conflict oil. And Obama chose Hugo Chavez over us.”

“Blocking the Keystone XL isn’t going to stop a single American car trip. It will simply ensure that car is fuelled by Hugo Chavez and King Abdullah of Saudi Arabia, who must have been popping champagne while laughing at Obama on TV.”

Around the same time Ethical Oil spokesman Jamie Ellerton wrote “every drop of Venezuelan oil that Americans buy, is more money that ends up helping Venezuela to help support Syria’s massacre of its own people. Conflict oil is fuelling more conflict.”

As much as a year ago, conservative staffer and Ethical Oil campaigner Alykhan Velshi suggested “Americans are still stuck supporting…Chavez. Sanctions won’t stop that; working on replacing every last drop of Chavez’s Conflict Oil with Canada’s Ethical Oil, will.”

The argument loses full steam however, when you consider Canada imports a tremendous amount of Venezuelan crude. That’s right – imports.

As reported yesterday by DeSmogBlog’s Kevin Grandia, “a May 2011 Natural Resources Canada report notes that Canada imported 33,000 barrels per day of crude oil from Venezuela in 2009. That works out to about 12 million barrels of oil that year.”

Those imports were valued at $778 million for the year and made up roughly 86 percent of Canada’s total imports from Venezuela.

As Grandia notes, Canada imports oil from other countries – like Algeria, Angola, Iraq and Nigeria – that suffer worse human rights records than Venezuela.

So Canada, if anything, represents a layover for Venezuelan oil.

And Canada’s oil (whether developed domestically or imported), like any other oil, is merely looking for a cheap and easy access to the global market, where it can fetch a higher price.

Albertan oil is landlocked and desperately needs an export strategy. Canada isn’t offering the US an ethical escape from conflict oil. We’re just looking for a path – any path – to an export terminal. And if the US allows it, we’ll track our oily footprints all over the national carpet on our way. 

Americans should be on their guard against Canada’s dirty exports – whether of the bituminous or rhetorical kind.

Image Credit: visionshare via flickr.

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Canada's tar sands are one of 14 energy megaprojects that are "in direct conflict with a livable climate."

According to a new report released today by Greenpeace, the fossil fuel industry has plans for 14 new coal, oil and gas projects that will dangerously increase global warming emissions at a time when massive widespread reductions are necessary to avoid catastrophic climate change. In conjunction these projects make it very likely global temperature rise will increase beyond the 2 degrees Celsius threshold established by the international community to levels as high as 4 or even 6 degrees.

"The disasters the world is experiencing now are happening at a time when the average global temperature has increased by 0.8 degrees Celsius, and they are just a taste of our future if greenhouse gas emissions continue to balloon," the report states.

The report, "The Point of No Return: The Massive Climate Threats We Must Avoid," [PDF] emphasizes the urgent need to move beyond dirty energy if we are to avert catastrophic global warming and includes research provided by Ecofys, a consulting firm specializing in sustainable energy and climate policy.

The research focuses on 14 megaprojects slated to produce as much new carbon dioxide emissions in 2020 alone as the United States produces in an entire year. Together these projects would add 300 billion tonnes of CO2 equivalent into the atmosphere by 2050, through the "extraction, production and burning of 49,600 million tonnes of coal, 29,400 billion cubic metres of natural gas and 260,000 million barrels of oil." By 2020, these projects would increase global CO2 emissions by 20 percent, placing the world on the path of a 5 or 6 degree Celsius temperature rise.

According to the International Energy Agency (IEA), global emissions increased by 5 percent in 2010 and 3 percent in 2011, right on track for a 5 or 6 degree long term warming. What will guarantee that level of warming is the continued construction of dirty energy projects. What could mitigate the dangerously high temperature rise is the halt of such projects in the next five years.

The Filthy Fourteen

The world's largest and dirtiest energy projects include coal production in Australia, China, the U.S., and Indonesia, oil production in Canada's tar sands, the Arctic, Brazil, the Gulf of Mexico, Iraq, and Venezuela's tar sands, and gas production in the U.S., Kazakhstan, Africa, and the Caspian Sea.

The Impacts

Ecofys estimates that a business-as-usual approach to energy production would entail "a clear scenario for climate disaster with a 5-6 degree celsius increase in average global temperature." An alternative scenario would involve a carbon budget designed to keep the global average temperature increase below 2 degrees.

"To stay within this carbon budget," according to Ecofys, "cumulative emissions between 2010 and 2050 cannot exceed 1,050 gigatonnes of CO2 equivalent (Gt CO2e), and global emissions need to start decreasing at the very latest by 2016." Cumulative emissions associated with the 14 megaprojects are estimated to be 2,340Gt CO2e, far beyond the acceptable rate if any progress is to be made to avoid "climate chaos."

The report states "the problem is that investment in energy infrastructure for fossil fuels locks the world into using coal, oil and gas for decades. The IEA estimates that 590 Gt CO2 is already locked in by existing fossil fuel-dependent infrastructure, and building new coal, oil and gas based infrastructure must stop by 2017 to avoid locking in more emissions than can be emitted without overshooting 2 degrees celsius warming."

"After that, the only way to stay below 2 degrees celsius warming is to shut down the many new coal, oil and gas power plants and the new coal mines and oil operations that could be operating, making the task of meeting the target hugely expensive and politically difficult."

The 14 projects would bind us to new carbon intensive investments, further entrenching the problem of fossil fuel reliance within the global economy. The solution, as recommended by Ecofys, is to make a quick and committed switch to clean energy projects which would "provide almost one third of the reduction needed to have a 75 percent chance of avoiding climate chaos."

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