The controversy over pipelines and how much oil lies underneath Alberta may suggest that Canada has more than enough oil to meet its needs. And yet, Canada is importing more oil than ever before.
In the Unites States, oil exports have hit a 15-year high. Most of it is getting shipped to Canada, according to the US Energy Information Administration.
It seems counter-intuitive that Canada produces 3.5 million barrels of oil a day and still imports so much of it. Many oil industry advocates argue that Canada needs to refine its own crude domestically so it can use it at home. “Most Canadians don’t realize, with the abundance of oil we have here in Canada, we still import almost 700,000 barrels a day into Atlantic Canada and the East Coast refineries,” says Greg Stringham, VP Oil Sands for the Canadian Association of Petroleum Producers.
According to Stringham, refineries in Eastern Canada don’t have access to the vast amounts of oil being produced out West due to the lack of infrastructure. “This underscores the need for an East-West pipeline, as we start looking at the supply into our Atlantic refineries,” he said.
Natural Resources Minister Greg Rickford agrees that projects such as an East-West pipeline could relieve Canada’s dependence on foreign oil. “Our government supports the construction of energy infrastructure that will transport our resources across Canada subject to independent, rigorous and science-based review,” he said. “Subject to approval by the National Energy Board, the construction of projects such as the Energy East pipeline proposal would further reduce Canada’s reliance on foreign crude.”
The rising oil imports highlights another issue with a contentious pipeline, says Ian Lee, assistant professor at the Sprott School of Business in Ottawa. He says US President Obama’s reluctance to approve Keystone XL, citing concerns about carbon emissions, is hypocritical. “He claims he’s the environmental president and yet quietly, behind closed doors, when no one’s looking, he’s allowing and enabling the Americans to export more of their oil to Canada,” Lee said.
There are also safety concerns when it comes to the volatile Bakken oil, which is primarily shipped via rail, a method that has been already proved dangerous in Canada. A train carrying Bakken oil had derailed in Lac-Megantic, Que. bursting into flames and killing 47 people.
The government has strengthened safety regulations around moving oil by rail, but critics say that’s not enough.