Alberta is quietly making progress in cleaning up its energy sector's environmental act. But maybe too quietly, if the province wants to gain ground in the public-relations battle being waged in the U.S. against its oil and the proposed pipeline that would deliver it.
This week, the Alberta Energy Regulator unveiled tougher rules empowering the regulator to force companies to conserve excess gases emitted from their oil sands operations, rather than venting them into the atmosphere or burning them off – wasteful practices that have been cited as contributing foul pollutants into the atmosphere. In one specific case, Baytex Energy Corp. has been ordered to install equipment to capture emissions from its bitumen facilities in the Peace River area, which give off strong gassy odours that have been blamed for a range of health problems among local residents.
The new rules don't include a blanket requirement to conserve all gas emissions – only, for now, those in specific areas and facilities identified as problematic. Nevertheless, it's a notable step in addressing the issue of the health impact of oil sands production on local residents, especially native communities – an issue that is raised often by the environmental lobby in the United States that opposes development of the Keystone XL pipeline that would transport Alberta heavy oil to southern U.S. refineries.
But this regulatory progress was drowned out by news this week that former U.S. President Jimmy Carter had added his name to a list of Nobel laureates publicly urging the U.S. government to reject Keystone XL – sending an open letter to President Barack Obama that cites, in part, the Alberta oil sands' pollution-intensive nature and their threat to the region's native communities. It's hard to beat that kind of celebrity publicity.
In a recent meeting with Globe and Mail editors and reporters, Alberta Finance Minister Doug Horner complained that Alberta doesn't get enough credit for the efforts it has made on the environmental front. Since 2007, the province has required oil sands producers to reduce their per-barrel greenhouse gas emissions by 12 per cent, and pay a penalty of $15 per tonne for emissions above their cap, which goes into an environmental technology fund. The industry and the province have been trying to sell that message in Washington – but they need to do more to win over the U.S. skeptics and ensure that Keystone gets built.
"There's ongoing dialogue between the industry and ourselves about what we can do in partnership to ensure market access," Mr. Horner said. "When you think about it in those terms … that opens up the art of the possible."
Yet it was more than a year ago that the Alberta government floated a proposal to reduce per-barrel emissions from oil sands by 40 per cent, and to increase the penalty to $40 a tonne for emissions above the new cap. The plan has gone nowhere since – and with the province in between premiers at the moment, it's not likely to go anywhere for a while. Mr. Horner indicated that the industry is reluctant to stick its neck out any further, as long as other jurisdictions and industries, in both Canada and the United States, aren't facing similar emissions rules.
The level-playing-field notion is not an unreasonable one. But most of those other industries aren't facing the kind of challenge to their future that the Alberta oil sands are. Incremental steps such as the gas-emissions changes are positive, but this isn't a battle that's going be won with baby steps. If Alberta, and its industry, are serious about turning the tide on the U.S. opposition to Keystone and the oil sands, a bold and serious crackdown on overall emissions may be the price to pay.
Follow David Parkinson on Twitter at @ParkinsonGlobe.
David Parkinson