Oil Sands vs Tar Sands - the negatives

I posted a series of 3 blogs on the Oil Sands at www.titulia.com back in February of March this year. I origanily wrote this for an international audience, so it might seem basic to some.

The oil sands are a large resource. They can help quench some of this thirst for some of the world for a few years (some say 20, others say a century, but that isn't the point of this article). But a lot of people say the cost is too high. There are grave environmental and social issues surrounding the oil sands. And a lot of people wonder if our thirst for fossil fuels is sustainable or are we just driving ourselves off a cliff by being so reliant on it.

The Environment
The environment is the problem that is getting the most press against oil sands development. Indeed, the problems appear staggering. Vast quantities of water are being used, the air is being pumped fill of greenhouse gasses, toxic waste is being bilged out across the landscape and large portions of boreal forest is being wiped out.

There are two methods to extract the bitumen from the ground. I don't really need to go into them here, but one method is strip mining and the other is in-situ drilling. In-situ drilling involves extracting the bitumen from the soil when it’s too far down to feasibly mine it. The most common method right now is to inject steam into a hole into ground that warms up the bitumen and causes it to flow through another hole. In the strip mining process, the bitumen is taken to a processing centre at the mine and refined using water so that it can flow through a pipeline. (I know I'm grossly simplifying both processes, but the process isn't the point of this article, check Wikipedia or other online resources for a more in depth look at the process if that interests you).

Both of these processes require large volumes of water. There is a fairly large watershed that surrounds the Athabasca Oil Sands, but many critics are saying that too much fresh water is being used. The water is also being pumped back into the water. Although the companies insist that the water has all oil sands impurities removed, there is evidence that this water is not as clean as it should be. The wildlife in this area is suffering and a community downstream of the oil sands development has very high cancer rates. In a time when much of world is suffering from water shortages it seems to be very short sighted to consume water for this industrial process when much of the world is starting to go thirsty. North Alberta (and Northern Canada) does have large fresh water reserves, but many are worried that these are being depleted because of this industrial development.

Most people are concerned about global warming. The citizens of all developed countries are demanding their governments do something about greenhouse gases. It would appear that the Government of Canada and Alberta are ignoring those concerns. Canada did ratify Kyoto in 2005 and agreed to cut its emissions by 5% below the levels it had in 1990 by 2012. In 2004 those levels had grown by 27% from 1990 levels! The energy exports of the oil sands play a role in this as does the extraction process. The machines used to mine the bitumen are the largest land vehicles in the world. They use an incredible amount of energy.

It doesn't help that they are also destroying large tracts of forest in order to mine the bitumen. Animals are losing habitat and the very things that can absorb the excess CO2 are being bulldozed. If you look at photos of an oil sands mine, you will see a very ugly strip mine. This was once very pristine and untouched wilderness, one of the last few places on the planet. Now the mines are an industrial wasteland.

Adding to this industrial wasteland is the toxic waste that comes from converting the bitumen into a product that can flow through a pipeline. This waste is being deposited into large tailing ponds. The tailing ponds have existed since they started mining the bitumen back in the late 60's. But they have recently gained much infamy when 500 migrating ducks landed in one two years ago. One duck managed to survive. Last year, a machine operator had his machine slide into a tailing pond. He didn't survive.

Social Issues
Such large operations do not come without its social costs. Before the oil sands, this area was home to a relatively high number of aboriginals who were still able to practice their traditional way of life. As the price of oil went up in the last few years, the development of the oil sands went at a feverish pitch. The City of Fort McMurray exploded overnight as people came searching for $40/hour jobs that a lot of people thought required little education. The infrastructure just wasn't ready for it.

The Aboriginals have been abused throughout Canadian history. From taking their land through unfair treaties to abhorrent living conditions on their reserves, the treatment of aboriginals is a black mark for Canada. There is a movement to correct these injustices, but it is taking a long time. Many of the aboriginal communities in the Fort McMurray region are very isolated. But they are feeling the pinch of the development. Water quality has deteriorated. The animals that they hunted to make a living off of are disappearing. The young people are leaving the reserves to try and cash in on the economic boom. Social networks are breaking down. Alcoholism and drug abuse are flourishing in these isolated communities. Some of the most vocal critics of the oil sands have been the aboriginal communities because they feel (yet again) that no one is listening to their concerns.

In 5 years (2001 - 2006) the population of the Fort McMurray grew from 41,000 to 51,000. This number does not count the large amount of temporary workers that were living at the construction camps between 2002 and 2007. A 25% spurt in population would be difficult for any community to handle. Fort McMurray went from being a sleepy little backwater mining/oil and gas town to being the economic hot spot in Canada. People came because they heard there were high paying jobs that required little education. There was certainly a demand for heavy equipment operators and other labourers, but there was also a need for skilled trades such as pipefitters and welders. People from across Canada flocked to Fort McMurray looking for these high paying jobs. It was the same as a gold rush. Everyone wanted to get their piece of the pie. Some were successful, others were not.

The town couldn't keep up. There was one main road in the town and the town is separated by a river. There is one bridge across this river. Tens of thousands of people needed to cross this river every day. There was a shortage of housing. People came to Fort McMurray expecting their accommodation to be paid for. This was true for some (particularly the skilled trades) but many did not get housing with their jobs and had to share a room for a $1000 month in sub-standard conditions. All forms of infrastructure creaked and cracked under the strain of a 25% population boom.

In any economic boom, you have your 'losers'. People were flocking to town expecting to strike it rich and of course not everyone can. I was working in Edmonton during the boom at a social agency. I had a call from a social worker in Fort McMurray asking if I could help a guy who saw it all go bad up there. The man was cabinet maker from Nova Scotia who had epilepsy. He tried his hand as a heavy equipment operator. But once he had a grand maul seizure behind a rather expensive piece of equipment he was blacklisted throughout town and his driver’s license was taken away. Someone who has no resources just can’t make a living as a dishwasher in Fort McMurray because of the high rents. He had to come back to Edmonton. He was able to succeed in Edmonton, since rents were lower and he could actually make a living as a dishwasher. In a town that is rich in money but short on any form of recreation, drugs and alcohol fills the gap for many people. This is another unfortunate reality of the boom.

Sustainable?
There are many people who question our need for fossil fuels and wonder if all this drilling and mining is sustainable for the planet. Many new technologies are in development that will decrease our reliance on fossil fuels. Unlike traditional drilling, oil sands require a very high capital cost. So a lot of money is being spent to develop this resource. The pace of development was incredible when oil prices climbed towards 150 USD/barrel. Prices are now at around 40. The development in the oil sands screeched to a halt. Current operations are still ongoing but new developments have all been shelved. Does it make sense to develop a resource that relies so heavily on commodity prices? Can this resource sustain an economy that is dependent on it? With all the problems outlined, should we continue to invest millions into something in which the negatives may outweigh the positives?

This was not an exhaustive list of problems. Indeed, much has been written about the problems the oil sands have created. I haven’t even touched on the role of government in this resource. This article sets up the discussion. My next article will discuss the positives of oil sands development. I hope you enjoyed reading this rather large article (I don’t think I’ve written something this long since University!) and stay tuned for the next one.