October 05, 2006
Dear activists,
Please see "GLOBAL ENERGY REPORTER" from October 05, 2006 Globe and Mail business section.
The news report states, "Canada's natural gas exports to the United States will fall by nearly two-thirds by 2020 as new unconventional sources fail to offset declining production in Alberta and rising domestic demand, a new study from Natural Resources Canada suggests."
It also reports that Canada, "will have to rely on expensive and heavily polluting oil sand projects to provide as much as 80 per cent of its oil production, up from 40 per cent currently, according to a department report, entitled Canada's Energy Outlook, which was released yesterday."
However, as a result of proportional sharing, the 65 per cent of Canada's oil and 61 per cent of its natural gas which is now exported to the United States cannot be reduced. In order to fulfill its NAFTA commitments to the United States, Canada is already importing almost half the oil it uses.
NAFTA limits the extent to which the Canadian government can act to reduce exports to the United States. Article 605(a) of NAFTA prohibits measures that would reduce these exports as a share of Canada's production to below "the proportion prevailing in the most recent 36-month period for which data are available."
The data in the Natural Resources Canada report also seems to runs quite contrary to what Prime Minister Stephen Harper and Ambassador Michael Wilson have been saying in the United States recently.
CBC.ca on September 21 reported on Harper's address to an elite business audience in New York: "On the economic front, Harper spoke with pride about the growing production from Alberta's oilsands and Canada's position as the largest exporter of energy to the United States. Harper touted Canada as an "energy superpower"..."
The Toronto Star on June 26 reported, "Canadian Ambassador Michael Wilson reminded an audience here last week that, in Alberta, the U.S. has an energy supply that is not dependent on the whims of a despot, seemingly touting Premier Ralph Klein over Venezuelan President Hugo Chavez..."
The statements by Harper and Wilson run contrary to Canadian public opinion. A recent poll conducted for the Canada Institute of the Washington-based Woodrow Wilson International Center for Scholars and the Toronto-based Canada Institute on North American Issues shows,"only one in five Canadians agree that Canada has an abundance of energy and should be sending more of it to the U.S., compared to 55 per cent of Americans who say the same thing." (Globe and Mail, October 5, 2006).
It's clear enough that Canada's oil exports to the U.S. have been steadily growing. In 2004, 70% of Canada's oil production went to the United States. In 1998 the figure was 60%. In 1990 the figure was 50%.
It's also clear that the U.S. is looking at Canada as a key source of their energy. Testifying before Congress in 2002, U.S. Vice- President Dick Cheney declared that the "continued development" of the Athabasca tar sands in northern Alberta could be a "pillar of sustained North American energy and economic security."
And we know that the U.S. was seeking access to Canadian energy through the first Free Trade Agreement. As Maude Barlow wrote in Parcel of Rogues (1990): For the United States, the energy provisions of the agreement were crucial...Edward Ney, the U.S. ambassador to Canada, said recently that Canada's energy reserves were a prime motivation for the free-trade agreement: "The U.S. got access to the great resources which we need."
Furthermore, the June 2005 'Report to Leaders' on the Security and Prosperity Partnership of North America includes a section on energy. This section states, "Creating a sustainable energy economy for North America is in the vital interest of all three countries...To that end, we affirm our commitment in pursuing joint cooperation in the areas of: regulation, energy efficiency, natural gas including liquefied natural gas (LNG), science and technology, reliability of electricity
transmission grids, oil sands production, nuclear energy, hydrocarbons and energy information, statistics and projections."
So how can the Natural Resources Canada report be reconciled with Canada's NAFTA commitments and the Harper's government promotion of energy exports to the United States? No word yet from the prime minister's office on this report.
