Black gold in Alberta sands

The process of extracting oil from the vast Canadian sands is a messy one, and with enormous profits at stake, what chance does…

The process of extracting oil from the vast Canadian sands is a messy one, and with enormous profits at stake, what chance does the environment have?

TO MOST environmentalists, the oil sands of Alberta are “Canada’s dirty secret”. Described by Tar Sands 101 as “the largest industrial project in human history”, the extraction of oil from bitumen (tar, in plain language) buried in the ground is blamed by them for causing air pollution, widespread deforestation and prodigious carbon dioxide (CO2) emissions as well as alcoholism, drug abuse and prostitution.

The scale of what’s going on around Fort McMurray in northeast Alberta is staggering. Vast areas of once heavily-wooded land have been taken over by the oil companies and either strip-mined by gigantic machinery – so large that it would crush an SUV without its operator even noticing – or deep-mined in situ with the use of steam to draw the bitumen from several hundred metres below ground.

The Green Party’s chairman, Senator Dan Boyle, recently called on our National Pensions Reserve Fund to support motions tabled by faith-based shareholder groups in Shell and BP on the issue. He said the extraction of oil from tar sands was “a particularly harmful, inefficient and greenhouse-gas-intensive method of producing fuel” and was “devastating for the local environment and indigenous communities”.

Neither Shell nor the other oil companies involved are making any apologies – because what they’re doing is so profitable. “Over the period 2005-2009 average earnings for oil sands mining were around US$20 (€15) per barrel, compared to . . . averages of around US$12 (€9) per barrel,” Shell said, adding that the oil sands contributed no less than US$31 billion (€23.3billion) to its earnings over the same five-year period.

Rob Seeley, Shell Canada’s sustainability manager, puts it in context by pointing out that Alberta is now second only to Saudi Arabia in terms of oil reserves. The bitumen sands of Athabasca, Cold Lake and Peace River – all in northeast Alberta – hold at least 175 billion barrels of oil that’s recoverable with currently known technology, he says. The total volume of the resource could be as high as 2.5 trillion barrels.

There’s a big difference between a conventional oil well and the production of synthetic crude from sand-laden tar. In The Transition Handbook: From Oil Dependency to Local Resilience, author Rob Hopkins uses the analogy of a pub. “Conventional drilling of sweet crude oil, such as occurs in Saudi Arabia, is like standing at the bar while a charming barman pours you pints direct from the cask in the cellar.

“Tar sands are akin to arriving at the pub to find that all the beer is off, but so desperate are you for a drink that you begin to fantasise that in the 30 years this pub has been open, the equivalent of 5,000 pints have been spilt on the carpet, so you design a process whereby you boil up the carpet in order to extract the beer again. It is the desperate, futile action of an alcoholic . . .”

Coinciding with this year’s Oscars, 50 environmental groups paid for a full-page advertisement in Variety, the Hollywood trade magazine, in which they dubbed the oil sands “Canada’s Avatar Sands” and likened Alberta’s production of synthetic crude oil from bitumen to the plunder of “unobtainium” in the film Avatar. American conservation magazine Audubon has also carried an unflattering profile of the industry.

It is a messy business. As Rob Seeley explains, the ore is first crushed, then combined with warm water in huge “tumblers” to make a slurry. This starts to separate the oil (10 per cent) from the sand (90 per cent). “The slurry goes into a large ice cream cone-looking thing, where the oil starts to separate and floats to the surface while the sand comes down to the bottom of the cone, and goes back into the pit.” Only 20 per cent of the oil sands is strip-mined; the rest must be reached by drilling.

Bitumen use in Alberta goes back a long way; Chipewyan Indians living along the Athabasca River waterproofed their canoes with it. Pioneer mining prospectors recognised its potential for conversion into oil and, after decades of trial and error, successes and setbacks, it was turned into a profitable business by Syncrude and Suncor, consortiums involving several oil companies, including Exxon and Chevron.

Syncrude’s main site north of Fort McMurray is an enormous complex that now produces 350,000 barrels of oil per day. Its belching flues, vents and chimneys make it look rather like a 21st-century version of William Blake’s “dark satanic mills”. And in the foreground is one of the company’s tailings ponds – an artificial lake filled with contaminated water. The largest of these ponds, to the rear, measures 30square kilometres.

Two years ago, at least 500 migrating ducks were drowned after they landed on Syncrude’s Aurora tailings pond and became oiled from residual bitumen in the soupy water. This happened despite a range of deterrent measures such as scarecrows, sounds mimicking birds of prey and cannons being fired repeatedly. The company expressed “sincere regret” and promised to prevent it ever happening again. Nonetheless, the company is being prosecuted for the duck kill under both Albertan and Canadian environmental laws.

Syncrude is investing $1.6 billion (€1.2 billion) to reduce its sulphur dioxiode (SO2) emissions by 60 per cent – even though the company claims that air quality in the municipality of Wood Buffalo, a wide area that includes Fort McMurray and Fort McKay as well as most of the oil sands operations, is “rated as good or better than in cities such as Edmonton , Calgary or Toronto”.

As to deforestation, the current level of oil sands activity has disturbed 530sq km of the boreal forest. All of the licences granted by the provincial government require full reclamation, although only about 12 per cent of the total mineable area has been reclaimed so far. Any notion that Alberta has a cowboy government is “absolutely false”, Rob Seeley insists, but he concedes that there is also a “legacy” from earlier operations when the regulations “weren’t as well developed” as now.

Oil sands projects are required to reduce their carbon footprint under regulations adopted in 2007 that oblige all heavy industry to cut CO2 emissions by 12 per cent from a 2006 baseline. “This is driving us to look at carbon capture and storage,” Seeley says. Indeed, the Alberta government has committed $2 billion (€1.5) from the substantial royalties it receives from the oil industry to make more progress on this front.

The oil sands have also brought benefits to the First Nations, or Aboriginals, in Wood Buffalo. Diane Farkouh, who runs the industry’s information office in Fort McMurray, says the oil companies “did $600 million worth of business with Aboriginals last year. They provided a whole range of services as subcontractors and suppliers, or in tree clearing, environmental monitoring and wildlife management”.

Ultimately, however, the industrialised landscape lurking behind the trees in northeast Alberta is about feeding North America’s insatiable demand for oil – at the current rate of 1.5 million barrels a day. “It’s a huge resource for which there’s a huge market,” Rob Seeley says. “And it’s all about security of supply for North America; otherwise, we’d be involved in a struggle with China and others for Middle East oil.”

Apart from profit, that’s the real reason why there will be no change for environmentalists at Shell’s agm on April 28th.


FORT McMURRAY, capital of the oil sands industry, is a classic mining town in classic mining country. Everything is carved out of the boreal forest – roads, sites for houses, all the development along Highway 63 (traditionally known as Sakitawa Trail) and, of course, the mines.

The population of Fort McMurray has been rising at 8 to 9 per cent per annum in recent years and currently stands at around 75,000 permanent residents. Others come and go, including those on a "fly in, fly out" programme, which allows them to live anywhere in Canada.

Dublin-born Dave Kane, who trained as a stonecutter in Harrison's of Pearse Street, has been living in Fort McMurray since 1981 and drives buses for a living. Kane, who's mother lives in Ballyfermot, joins the early morning traffic at 5am dropping off workers at the oil sands sites and goes on till 9am. Then he's back at 3pm, often driving till 9pm, ferrying them home.

"When I came here, you could smell the oil sands," he recalls, adding that a Limerick-born doctor, John O'Connor, first noted the area's high rate of cancer and its potential link to the environment. "At the time, they all dumped on him – but he was proved right." Fort McMurray, Dave Kane says, "is a one-horse town – no oil, no town".

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