Selling Canada by the cubic foot
Roel Meijer
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LNG tanker, or "floating bomb" as it's affectionately known
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Plans for environmentally dangerous LNG terminals will leave Canada and Quebec bloated with gas
On July 14, one day before travelling to St-Petersburg for the G8 meeting, Stephen Harper gave his first speech abroad in his capacity as PM. He told the Canada-U.K. Chamber of Commerce in London that Canada is the "new emerging energy superpower."The next day upon his arrival in Russia, Harper, according to Canadian Press, "hadn't yet checked into his hotel" before he and Putin met and announced a Canada-Russia joint venture to send Russian gas to Canada.
But why does an energy superpower need to import Russian gas?
Under NAFTA's "proportional sharing" clause, Canada is obliged to sell the U.S. a fixed quota of its energy assets, over 60 per cent, even if Canada runs out of oil and gas and we're freezing in the dark. Mexico didn't accept this clause, but Canada sold itself outright. While "energy security" is a huge issue south of the border, Canada, which once had a law stipulating the country keep 25 years of supply for itself, today has completely relinquished control of its energy security.
The NDP denounced the deal, saying "the amount of natural gas Canada must provide to the U.S. would increase if we imported gas from Russia, however, if Russia cut back on the amount it was supplying, the American quota would stay the same, forcing Canadians to give up supplies we might need for ourselves."
In the U.S., over 200 electricity plants designed to run on natural gas were built in the past 20 years. People thought there was an abundance of natural gas available. Not so. But Canada
exports natural gas, therefore it must have large reserves, yes? Not so. According to the U.S. Energy Information Agency (EIA), Canada has eight years left at present production levels. Moreover, there's rising demand from the U.S. and Alberta's oil sands. In 10 years, the oil sands will use enough gas in the extraction process to heat every single house in Canada.Natural gas is much harder to transport than oil, which can simply be pumped into a tanker. It has to be "superchilled," under pressure, to about -160 C (which shrinks its volume 600-fold) and transported in special tankers as Liquefied Natural Gas, or LNG. At the destination, an LNG re-gasification terminal reheats it. LNG carries risks. The U.S. currently has only four LNG terminals. Though there are lots of applications for more, building permits are held up by public protests. So attention shifted to Canada. Canadians are less aware of the dangers of LNG, and there is less resistance.
Two LNG terminals in Canada have been approved, Bear Head in Nova Scotia and Canaport in New Brunswick. Two are awaiting approval in Quebec for the St-Lawrence River: Gros Cacouna, owned by TransCanada and Petro Canada, and Rabaska, owned by Gaz Métro, Gaz de France and Enbridge. Three more in the rest of Canada means seven new terminals in a country that needs only a fraction of the gas imported.
Jacques Levasseur, president of APPEL (Association pour la protection de l'environnement de Lévis) sounds desperate when reached by phone. He'd like to know why Canada needs LNG terminals when it has natural gas reserves. "Rabaska will produce 150,000 tons of greenhouse gases per year." He calls the location a poor choice. The terminal is planned about 1 km from the town of Lévis and pristine Île d'Orléans, and less than 10 km from Quebec City. But APPEL feels its protests fall on deaf ears, and politicians listen to money, not people. Gros Cacouna's final decision is expected next week, Rabaska's a bit later. Levasseur is not confident that Quebec Environment Minister Claude Béchard will rule in his favour.
Gros Cacouna will import LNG from Russia, and Petro Canada is eager to buy stock in Russia's Gazprom energy giant. Rabaska says it will get gas elsewhere. Algeria, Qatar, Trinidad are options. However, Rabaska partner Gaz de France is about to be privatized. And who is bidding high but... Gazprom. Accidents never happen alone. And money talks in Canada, and in Quebec, these days.
Wake up commentators, the more I read about energy deals and selling resources the more I realize that we have already sold ourselves out to the United States and I don't know if that is out of fear or rationale. Canadian leaders must have gotten wind that's it's either sell out the resources for shallow returns or the American eagle will be flying over Parliament Hill. Nobody talks about this in public but after years of getting short changed and not even capable of applying our just rights we are getting what we ceserve. All one has to do is see the political joke unfolding between us and the Danes with regards to a disputed claim of a small rock off Greenland. We have no teeth there when it comes to sovereignty so no wonder we're just patsies when it comes to selling resources.
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Martin Dansky
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{18 votes}
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Why are people surprised that NAFTA is still putting the screws to us? We were the U.S.' bitches before NAFTA and now we still are except they now have the contract we signed on to put pressure on us. Never go into a deal where your negotiating position is begging.
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Vladimir Joseph
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{24 votes}
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Incredible - we've sold our natural gas energy reserves in the here and now and mortgaged our future to placate the U.S. Our cut-throat southern neighbours are now entitled to a disproportionate amount of our energy assets - a whopping 60% under NAFTA. Even Mexico had the common sense to opt out of this dubious clause. Hell, if the U.S. can screw us seven ways from Sunday over the softwood lumber issue, we best be doing likewise because our energy reserves are far from boundless!
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Mark St Pierre
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{16 votes}
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NAFTA's "proportional sharing" clause roughly translates into "disproportional screw-job" once you muddle through the legalese bullshit, don't it? Canada is obliged to sell the U.S. a fixed quota of its energy assets? Excuse me but is giving over 60 per cent of what we've got to a nation that doesn't even respect you as a partner sound like a good deal? Need I remind anyone of how the soft lumber mess played out? The more you learn about the way this world works the more you realize that it just doesn't.
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Pedro Eggers
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{17 votes}
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