Oil Industry In Canada

The Alberta Oil Sands have affected many stakeholder groups such as government, residents, researchers and employees. However, we will focus on how it affects the Alberta Government; specifically, Ed Stlemech of the Conservative Government. As my stake holder, Ed Stlemech does not live within the Alberta Oil Sands area as well as have any direct relevance to it, I will instead examine how it has affects the citizens of Alberta and more importantly, those who live in and near the Fort Chipewyan area. In this way, the environmental, the economical as well as the societal impacts will impact Albertan voters and therefore impact the Conservative Government in way of the Alberta General Election.

Several oil-countries have been facing economic and political turbulence as a result of the crash in oil prices, and there is disagreement among OPEC as how to handle the situation. (Krauss) While this is happening, America’s oil production continues to rise, as it inches closer to becoming an energy superpower in production and consumption; and countries that depend on their oil exports face recession.

Alberta has the second biggest recoverable oil patch in the world after Saudi Arabia, which hides underneath Canada’s boreal forest. Indeed, the Albertan oil patch consists of tar sands, also referred as oil sand, a combination of clay, sand, water and bitumen – a thick and sticky form of crude oil. Tar sands are mined and transported to extraction installations, where the oil-rich bitumen is extracted from the mixture. Alberta holds at least 175 billion barrels of crude bitumen throughout its vast territory, thus the industry disturbs a 149 000 square kilometers area – about the size of England –, where the land was removed due to the mining required to access the oil sands. The bitumen is separated from the mixture by using large amounts of fresh water – about four barrels of water to produce one barrel of oil – and is heated by natural gas, thus requiring larger quantities of energy and water than conventional extraction. Indeed, the industry itself results in the emission of more carbon dioxide in a year than all Canadian cars combined, thus accelerating climate change at an alarming rate. The Albertan industry exploits the water from the Athabasca River, which is fed by the Canadian Rocky Mountains’ glacier, which shrinks at a frightening rate and is further endangered by the carbon emission of the industry. Therefore, the extraction of oil sands in Alberta results in a cycle of consumption that truly endangers the environment. The clay and minerals from the oil

[Oil production has jumped from 5.0 million barrels per day in 2008 to 7.4 million last year and is expected to average 8.5 million this year and 9.3 million next year, according to the EIA, the analytical arm of the Department of Energy.” (Koch par. 2)]

Modern day Canada is posed with the current issues of energy and the environment becoming increasingly important within the public and political sectors. The impetus has come from a variety of factors such as the collective development of nonconventional resources, the environmental concern of Canadians, and the demand for renewable energy sources. Many premiers have since called for a ‘national energy strategy’ however the governments tendency to avoid national approaches to energy allows no progression to be made. This has become largely apparent in the current debates over Alberta’s bitumen deposits. The Alberta government has advocated for a ‘national energy strategy’ led by Ottawa placing their political emphasis on the need for Canada to achieve a vision of environmental supremacy. This paper seeks to investigate the clashes of interprovincial trade and commerce powers with the provinces natural resource power debates over Alberta’s bitumen deposits in conjunction with the general Canadians feeling of a lack of democracy.

The Canadian “Alberta Oil Sands” are the third largest oil reserves in the world and has an investment value of over $27 billion. Over 100,000 employment opportunities are generated as a result of the oil sands and it leads to a production rate of approximately 2.3 million barrels per day. One of the largest controversies in Canadian politics is whether to oust the oil sands production or expand it. However between the two articles, “Why Canada needs to develop the oil sands” by Konrad Yakabuski and the article “Stop oilsands expansion, Canadian and U.S. researchers say” by CBC News, the debate is whether to expand the reserves or remain the same. After analysing the two articles it is evident that the author Konrad Yakabuski wrote his article

The reason of the fall in oil prices are the constant change of demand. The need for the oil is actually stagnant. Crude oil is becoming a product of the past. Today, you can harvest energy from solar, wind, water, heat, and waves. According to The Economist, “The use of fossil fuels in the rich world is mostly falling. Emerging economies are not currently taking up the slack”.

The oil crash in Alberta has caused severe issues not only in the economy of Canada, but also in the livelihood of Albertans. Oil from the Middle East( Saudi Arabia and Iran) had flooded the oil market with large supplies of oil. Due to the principle

This affects local population settlements along the banks. The production of the oil sands is a human rights issue as it effects local drinking water , an environmental issue with the destruction of local wildlife and an first nations people issue. By and large the general public in Canada and the United States do not know what is going on in northern Alberta. The public still does not fully comprehend how First Nations communities are the most negatively affected. First Nation Canadians live very close to the oil sands , mostly along the Athabasca River basin area. These are the First Nations communities of Fort McMurray, Fort Chipewyan and Fort McKay. The oil sand production plants around Fort McMurray and Fort McKay are located north along the Athabasca river . Currently oil sands production and storage of toxic waste has completely changed the Athabasca river and surrounding wetlands. This production and storage has caused de-forestation , toxic contamination of rivers and wetlands and disruption of wild life habitats. These changes to the environment have disturbed the way of life that people in these communities grew up on , currently the levels of mercury and lead in the Athabasca river are high enough that residents will not eat the fish in the river.

Diverse and multi-faceted, the Canadian business market is one of the strongest functioning mixed market economies in the world. Within the Canadian economy, the oil and gas sector stands as one of the largest and most influential sectors. The oil and gas industry is unique as it affects almost every person and sector of the economy worldwide, whether it is through commodity or material input costs. In Canada, this growing industry could allow for the country to be the one of the “biggest energy producers in the world” leading to a massive paradigm shift globally.

The demand of gasoline has increased steadily over the last twenty years. In 1981 the U.S. averaged 6.5 million barrels of gasoline consumption per day. By comparison, in 2004 the U.S. averaged 9.2 million barrels of gasoline consumption per day. For most of this time period, gas prices stayed relatively the same. This is because the U.S. refineries increased their production to meet the demand and maintain the equilibrium price. Also during this same time period worldwide demand for crude oil increased 27%. Crude oil producers also increased their production to meet the demand keeping prices the same.

The statement ‘Canada oil sands are much more of a blessing rather than a curse’ is not true because the disadvantages of oil sands outweigh the advantages. For this reason, this paper aims at indicating points against the statement. To understand the defects of oil sand exploration in Canada, one has to delve into the explanation of what oil sands are as well as how the entire process of mining and refining and thereafter, determine the disadvantages based on socioeconomic factors, environmental factors, as well as the infrastructure and energy required for its production.

World oil demand is increasing as emerging economies need more energy to increase their living standards. Estimates, shown below, are that by 2030, China and India as emerging markets will import over 70% to 90% of their fossil fuel needs (1) . Coupled to a continued high and growing demand for oil, makes this a robust market for the next 30 years.

Because private companies and nations have over-estimated oil reserves it is difficult to be exact but these estimates of world oil reserves are close and further research will reflect this. Also, rapid exploitation may have damaged many reserves' wells and will limit production. It may be that we (the world) have much less than is believed! The United States past its "peak oil" point back in the early 1970's ( for further research refer to Peak Oil Crisis Books) and now imports about two-thirds (2/3) of its oil. The U.S. economy and the current American way of life is supported by energy from other nations. Those nations that have not already past peak oil (maximum production) are very near it. In the future, production will decrease while at the same time demand increases. The spread between supply and demand will cause higher prices (for all products),

The US consumed 142 billion gallons of gasoline in 2007 and the tax applied on it is 18. 4 cents on one gallon. All around the US, there are around 162,000 retail gasoline outlets. With the price of crude oil hovering around $100 a barrel, it is no wonder that concern is growing about the gas prices being so high. After all, modern economies are kept moving by this lifeblood. For instance, in the United States alone personal vehicles consume more than 140 billion gallons of diesel fuel and gasoline per year.However, there are several factors that contribute to the gas prices being so high. Given below are a few of them. Increasing Demand for Oil One of the main catalysts for the incessant rise in gas prices has been one of the most