Yahoo News 26 Sep 08;
Canada will ban the export of tar-like bitumen from the Alberta oil sands to countries that don't match Canadian targets to reduce greenhouse gas emissions, according to Prime Minister Stephen Harper.
"We are imposing regulations on the oil sands to achieve important environmental targets for this country," said Harper at a press briefing on Friday, adding that Canada will not allow the emission target to be avoided "by exporting to countries that do not impose sufficient environmental standards.
"We think that's environmentally responsible," said Harper.
The United States is the largest consumer of bitumen from the oil sands in Alberta, the western Canadian province that holds 173 billion barrels of the oil source in its reserves.
Harper's promise is likely to have no impact on bitumen exports to the United States, said Environment Minister John Baird, but could affect the construction of a major pipeline from Alberta to the Pacific coast to feed the Asian market.
Questioned on whether the emission target proposal would have an impact on future bitumen exports to Asian countries, Harper replied: "Well, it could. It absolutely could."
The prime minister refused to name the countries most likely to be affected by his pledge, but according to analysts China would be affected more than others because it imports more of the oil source than any other Asian nation.
Canada will not meet targets for reducing greenhouse gas emissions under the Kyoto Protocol, but Harper has pledged to reduce Canada's emissions by 20 percent by 2020, a target deemed inadequate by Harper's critics and environmentalists.
An estimated 500,000 of the 1.3 million barrels of bitumen produced in Alberta each day are exported before they are transformed into crude oil.
Oil production in Alberta, an industry that generates a significant amount of greenhouse gases, is projected to triple by 2015.
Canada PM Oil Sands Plan Puzzles Industry, Greens
Jeffrey Jones, PlanetArk 29 Sep 08;
CALGARY, Alberta - Prime Minister Stephen Harper said on Friday he would ban exports of tar-like bitumen from Alberta's oil sands to countries that do not match Canadian efforts to cut carbon emissions, a campaign promise that perplexed both the oil industry and environmentalists.
The policy could affect Asian countries that are the target of a proposed Enbridge Inc pipeline that would move oil sands-derived crude to Canada's West Coast to be shipped across the Pacific Ocean by tanker, Harper said.
He announced the move at a campaign stop ahead of the Oct. 14 general election as a away to prevent companies from avoiding Canadian emission standards, he said.
Asked by reporters if it could affect future bitumen exports to Asia, he said: "Well, it could, it absolutely could."
The ban would not affect existing contracts, all of which involve supply agreements with US refineries, he said.
Enbridge's planned C$4.2 billion (US$4.1 billion) Gateway line would take 400,000 barrels a day of oil sands crude. The initiative is being driven by interest from refineries in such countries as Singapore and Japan, the company has said.
Harper's plan surprised Enbridge, and the firm has yet to determine its impact, spokesman Steven Greenaway said.
The Canadian Association of Petroleum Producers, the oil industry's main lobby group, said it too was still trying to make sense of the ban in the absence of many details.
The Conservatives did not say how close to achieving promised emission cuts any country must be to avoid the ban, or which countries were most at risk at being denied oil.
Canada's oil sands are the largest oil reserves outside of Saudi Arabia. Producers plan to spend C$100 billion exploiting the carbon-intensive resource and output is expected to nearly triple to 2.8 million barrels a day by 2015.
Federal Environment Minister John Baird and Industry Minister Jim Prentice said the proposal was unlikely to affect bitumen shipments to the United States since both presidential candidates have pledged to cut greenhouse gas emissions.
"I think it's clear that the United States is moving gradually toward a similar policy to our policy with respect to greenhouse gas emissions," Prentice said.
Harper's Conservative government has said it aims to cut greenhouse gas emissions by 20 percent from 2007 levels by 2020.
Environmentalists, who criticize the government for not being nearly tough enough on industrial emitters, were unimpressed by the bitumen plan.
"If Harper really cared about reducing greenhouse gas emissions from the tar sands, then he would be talking about actually reducing the greenhouse gas emissions coming from the tar sands rather than just selecting which country they will come from," Greenpeace campaigner Mike Hudema said.
New Democratic Party leader Jack Layton, who wants a moratorium on oil sands expansion, called it "absurd" for Harper to complain about emission rules in other countries.
"He doesn't have limits on carbon emissions in Canada," Layton told reporters in Vancouver, British Columbia.
The issue of raw bitumen exports is already controversial in Alberta, whose own government has called for more plants at home to upgrade the gooey crude into refinery-ready light oil.
Promoting more upgrading within Alberta would create jobs in the province, Harper said.
However, some upgrading plants have already been delayed or shelved due to spiraling costs and a tight labor supply.
Companies, including EnCana Corp and Husky Energy Inc have struck deals to export raw bitumen to US refineries, where upgrading costs are lower.
(US$1=$1.03 Canadian) (Additional reporting by Scott Haggett and Allan Dowd; editing by Rob Wilson)
