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Discussion Starter · #1 · (Edited)
I truly believe this deserves a thread of it's own. I'm a news junkie and lately more and more news is coming out of Canada's oil sands faster than ever. We really should be discussing this.

What is oil sands?
http://www.youtube.com/watch?v=ALCTOs2zakc

I used to think this was good for Canada's economy. I thought we were reaping the benefits of having the second largest oil supply in the world, but the more I research and the more I look into the oil sands project, the more I realize it's probably a curse to our country.

Don't get me wrong. The oil sands does have the potential to benefit Canada's economy, but we're going about it all wrong. Allow me to explain what I believe we're doing wrong.

The environmental impacts are obvious(and I'm not going to talk about it that much), but my biggest fear is the tremendous amount of fresh water that is used to refine the bitumen into oil. It could easily wipe out Canada's fresh water supply. We should be looking at piping in salt water and not using Canada's limited fresh water.
http://www.youtube.com/watch?v=EOk0Fyov_2A

The video I posted above also shows why America stands to benefit from the oil sands more than Canada does.

Canada does not own the oil sands. America does thanks to Koch industries. Which is an American company run by the Koch brothers. The very two men who finance the Tea Party in America.

Because the oil sands is not owned by Canada there is very little obligation for the oil sands project to provide Canadians with jobs. Which is why the Koch brothers are piping all the oil from Alberta to America to provide Americans with refining jobs. They can then sell us back our oil in the form of gasoline.

oil sands pipelines are costing Canadians jobs
http://thetyee.ca/Blogs/TheHook/Environment/2010/08/09/oil-sands-pipeline-Canada-Keystone-XL/

Canadian oil is financing the Tea Party
http://cornwallfreenews.com/2010/11...komorowski-cornwall-ontario-november-16-2010/

I personally wanted to see the oil sand first hand, and understand it more by getting a first hand experience. I was looking at getting a job in the oil sands after I heard about everyone in Fort Mcmurray making $30 - $40/hour inthe oil sands, but then I came across this guys blog who was a former electrician working for Suncor at the oil sands project and he explains the working conditions at the camps managed by the oil companies located at the oil sands. The conditions at these camps clearly are not in line with Canada's labor laws.

http://adhdcanuck.wordpress.com/201...-you-to-rotten-enter-the-mackenzie-camp-zone/

Fewer and fewer Canadian citizens are working at the oil sands and expansion into the oil sands is growing fast. This is creating a severe labor shortage and the Conservative government found an answer. They're now letting foreign temp workers into Canada to work in the oil sands for less pay and to be exploited. Cheap labor folks.

Foriegn temp workers being exploited
http://www.fortmcmurraytoday.com/ArticleDisplay.aspx?e=2852408

oil sands experiencing a labour shortage
http://www.ctv.ca/generic/generated/static/business/article1824791.html

That's correct right wing supporters! The very government that has gotten tough on human smuggling and immigration and queue jumpers has opened the flood gates into Alberta. A lot of these temp workers slip through security and remain in Canada as illegals.

Most of these temp workers are shipped back to the Philippines, India or China and contribute nothing to our economy because they typically send all the money they make back to their families in their home countries.

So yeah, do you guys think Canada is getting cheated out of it's oil? I sure do. We can do better. The Saudi's nationalized their oil and they're reaping in the benefits.
http://www.youtube.com/watch?v=D1t4ue-WmlU

Norway also did it.
http://www.slate.com/id/2108873/

Seriously! The Norwegians are brilliant!
Norway has pursued a classically Scandinavian solution. It has viewed oil revenues as a temporary, collectively owned windfall that, instead of spurring consumption today, can be used to insulate the country from the storms of the global economy and provide a thick, goose-down cushion for the distant day when the oil wells run dry.
Less than 20 years after they started producing oil, the Norwegians realized their geological good luck would only be temporary. In 1990, the nation's parliament set up the Petroleum Fund of Norway to function as a fiscal shock absorber. Run under the auspices of the country's central bank, the fund, like the Alaska Fund, converts petrodollars into stocks and bonds. But instead of paying dividends, it uses revenues and appreciation to ensure the equitable distribution of wealth across generations.
If oil sands were nationalized the working conditions would have to be improved because the government would have to oblige to their own labour laws. Once the working conditions are improved more Canadians would be willing to work at the sands and that means we won't need as many foreign temp workers, and having more Canadians working at the sands is better for our economy.

Plus a nationalized oil sands is better for Alberta as the provincial government will have more money to fund into Alberta's infrastructure and the oil wealth will pay off the province's debt allowing them to reduce commercial taxes to practically ZERO which would help to diversify Alberta's economy.
 

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First, with regard to water, which I believe is the most fundamentally important environmental issue in the oil sands, I agree with your concern. I urge you to look into a Canadian company called Titanium Corp, I think you will find what they are doing encouraging in that regard.
Second, in terms of foreign ownership, I have asked myself that question many times. It may shock you to find out that those great hydro-electric dams in Quebec, Manitoba and B.C. are also foreign owned (as in the debt that financed them is foriegn-owned, even though the utility is locally owned). The truth is, Canada does not have the capital pools to build these large projects on its own, not even at the federal level. The concentration of capital in Canada is very low, and therefore these size developments are almost always financed or owned by Americans, Europeans or now, increasingly, Asians. This was the case with the railroad, the hydro-dams and now with the oil sands, Canadians have all-together become one of the most prosperous nations in the world as a result, so i don't see any problem with foreign investment. The good news on this front is that in fact, a large majority of the workers are Canadian, and the presence of the oil sands projects has acted as a spunge to soak up the excess labour pool in Alberta, Saskatchewan, Manitoba, B.C. and Atlantic Canada. The truth is that the oil sands is an economic juggernaut to Canada, without which our economic situation would be plagued by the same recessionary tendencies of the northeastern rustbelt states, overwhelmingly characterized by declining manufacturing in central Canada. The oil sands have kept the unemployment rates in Western provinces extremely low, and lowered the unemployment rates in the Atlantic Provinces too, while feeding the Bay street banks and investors steady income streams from royalty trusts like COS-T and Penn West, as well as M&A, IPO and debt financing fees. The oil sands have produced two of the fastest growing pipeline companies in the world (Enbridge and TransCanada), they have allowed several large Canadian oil companies to become players on the world stage, Suncor (Petro), CNRQ, Cenovus and Husky, they have spun off internationally marketable technologies for heavy oil extraction such as the THAI process, innovative SAGD processes among others, and several other technologies, which are now in the late development phases. They have fed the oil field service sector, the temporary housing sector, the steel manufacturing and pipe building and welding sectors. Even projects which are owned by foreign companies pay high royalties on every barrel of bitumen removed from the ground, they also pay shipping costs, corporate taxes on profits from the sale of that bitumen in the US to provincial and federal governments, land lease fees to explore for and devlop the bitumen deposits, and most of the large refineries in the US that process bitumen into gasoline and other refined products, such as Wood Buffalo near Chicago, or Lima, Ohio are 50% owned by Canadian companies as part of joint ventures wit major multi-nationals to vertically integrate the supply chain and protect against price fluctuations between bitumen and upgraded crude contracts. In fact, the biggest reason that bitumen is shipped to the US is that Venezuelan production is falling, despite having larger reserves than Canada, a product of nationalization of heavy oil fields and corruption in the government there, which some argue was a result of greater state ownership of oil. The lack of heavy venezualan crude feeding refineries along the gulf coast has left these refiners looking to Canada for supply of heavy oil. A major pipeline called the southern access pipeline is being built to bring in that heavy oil from the oil sands.
Third, the oil sands are an extremely low-margin oil business, and very risky when the price of oil fluctuates so greatly on a daily basis. It is no wonder Canadians prefer to invest their money in safer ventures, as these developments, on top of being very costly, are very risky as well. One of the largest concerns with the oil sands, from a financial point of view is the turnaround costs for upgraders. Despite what you mght have heard, a large majority of the upgrading takes place in Alberta, not in the US. But these upgraders require constant maintenance due to the eroding nature of the water/sand mixtures which are processed within them. The piping is constantly eroded and needing replacement, as the effect of passing sand mixed with water through them is similar to rubbing sand paper against a wall constantly. These turnarounds take months and result in inconsistent suplpy of upgraded curde to the pipeline, which is also costly. Another significant reason for shipping the crude to the US or offshore is the environmental impact. Upgrading and refining are extremely GHG intensive processes, and refineries and upgraders are notorious polluters, emitting noxious gases sulphur dioxide, nitrous oxide into the air and polluting underground aquifers with all froms of petroleum hydrocarbons. Canada is in enough trouble just trying to get it out of the ground, with up coming GHG accords. Add to that that it is essentially impossible to get environmental approval for new refineries in Canada, and you are left with the only logical route to market for any company operating here. This is not necessarily a bad thing, as the refining business is not a profitable one of late. I would urge you to look at the last three years of financial results of Valero Energy, the largest oil refiner in north america, who has almost broke even over that period because the 3:2:1 crack spread is so low, it costs more to refine it then the added value you get after selling it.
Lastly, with respect to migrant workers, the government is encouraging skilled trades to come work in Canada, because that is where the shortage lies, but it doesn't stop at the oil sands projects, it includes mines, infrastructure, ports, highways, electrical transmission lines, and hydro-electric dam projects across Canada, all of which are planned to start in the next two years. These poeple are builders, and as builders, they help make building in Canada affordable, and they are more than welcome to stay and contribute IMO.
 

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Discussion Starter · #6 ·
Thank you for your input Coral Builder. I agree with some of what your saying and your post helped me to better understand the situation in Alberta.

Even projects which are owned by foreign companies pay high royalties on every barrel of bitumen removed from the ground
Ed Stalmech and Alberta's conservative government continue to slash away at royalty payments for Alberta. They're at an all time low.

http://www.cbc.ca/canada/calgary/story/2010/11/25/calgary-alberta-oil-gas-royalty-report.html

Danny Williams was a great premier for Newfoundland. He made sure Newfoundland recieved higher royalty payments for it's oil, which is why the big oil companies hate him so much.


The good news on this front is that in fact, a large majority of the workers are Canadian, and the presence of the oil sands projects has acted as a spunge to soak up the excess labour pool in Alberta, Saskatchewan, Manitoba, B.C. and Atlantic Canada.
That's quickly changing. More Newfoundlanders (who made the majority of Canadian born oil sands workers) are now staying in Newfoundland to work on the new oil prospects off the coasts of Newfoundland.

There are fewer and fewer Canadians working in the oil sands and therefore the conservative government is bringing in more foreign temp workers here.
 

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Discussion Starter · #7 ·
^^ most countries are more "Federally" focused than in Canada with the highly divisive Federal/Provincial share of power. To further nationalize oil would have Western Canada up in arms even moreso than it already is. There is still resentment in Calgary over Petro Canada.
The provincial division in this country is our biggest weakness.

Canada vs Quebec
Canada vs Ontario
Canada vs Toronto
Alberta vs Ontario
Alberta vs Canada
Eastern Canada vs Western Canada
Rural Canada vs Urban Canada

I wish the provinces would quit acting like seperate nations with their own interests and start realizing they're just a piece of the puzzle that makes up Canada.
 

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There is a Vancouver tv producer type who is now proposing that Vancouver separate from the rest of Canada.
I propose we seperate him from Vancouver and then throw him in a cold, hard, icy, dark, lonely ditch in he middle of nowhere in Canada. Them ban him from Vancouver if he manages to make his way back.
 

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I think it will be interesting to see how the revival of the Mackenzie Valley pipeline will affect this debate. It will connect the oil sands to the Mackenzie Delta, which will no doubt see a frenzy of construction and other activity come back to the area. They just finished their application in late december of '09.

I wonder if they will hire locally, or if stakeholders involved will bring in their people from outside the country to take away more potential Canadian energy jobs.
I know the APG (aboriginal pipeline group) is involved in the entire process, so I'm sure they will reinvest in native communities located in northern Alberta and the Northwest Territories.
 

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There is a Vancouver tv producer type who is now proposing that Vancouver separate from the rest of Canada.
It's hard to believe that anyone who wants Vancouver soverignty wouldn't want to take the rest of BC along with it. Vancouver isn't Vancouver without... BC.
 

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^^ most countries are more "Federally" focused than in Canada with the highly divisive Federal/Provincial share of power. To further nationalize oil would have Western Canada up in arms even moreso than it already is. There is still resentment in Calgary over Petro Canada.
As I mentioned in another thread, I think this is perhaps the biggest weakness of Canada. We have a very unfair and inefficient way of sharing resources in this country and a lot of barriers that make it hard for Canadian cities and businesses to compete globally because they are often restricted to smaller provincial marketplaces.

Albertans should have a right to the value of their labour but not an exclusive right to natural resources they had no hand in creating.

If natural resources were federally managed there would also be more steady revenues and it would be less political. There would be no decisions of what rights to give to which provinces and there would be no threats from businesses of pulling up and moving to other jurisdictions that offer them better deals (corporate welfare competitions are terrible).
 

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Personally I believe that the provinces are too big. I think that we should split B.C., Alberta, Saskatchewan, Manitoba, Ontario and Quebec in two. Making essentially an upper Alberta and a lower Alberta and so on.
 

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It's not that they're to big. It's just that they're to SPARSE! We need more resource rich, northern cities to help the provinces. Problem? No exploration.

It's like some humans have completely lost there sense of exploration.
 

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Discussion Starter · #16 ·
It's not that they're to big. It's just that they're to SPARSE! We need more resource rich, northern cities to help the provinces. Problem? No exploration.

It's like some humans have completely lost there sense of exploration.
You have got to be kidding me. Every mining and oil company out there is spending billions exploring every nook and cranny on this earth in search of natural resources.

Oil companies are spending even more money now on exploration because they have to dig even deeper under ground in order to find oil.
 

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You have got to be kidding me. Every mining and oil company out there is spending billions exploring every nook and cranny on this earth in search of natural resources.

Oil companies are spending even more money now on exploration because they have to dig even deeper under ground in order to find oil.
I'm talking about government exploration or government funded exploration. I also said up north, not down south. I'm talking the northern part of every province and all of the territories. I mean like EVERYWHERE!
 

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The country has known about oil reserves and diamond desposits in remote places like Nunavut and the Northwest Territories since the 1950s. I'm sure they know about all the other substantial resources deposits too. It's not a matter about exploration, it's a matter of extraction costs. Deposits only become viable to extract when their commodity price outweights the price to exract them.
 

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People should type this in there google maps browser and hit enter.

57.024401, -111.505852

That River must be hurting from all of this.









This was caught in Lake Athabasca, it has two mouths.




If you search around the area I gave you a google maps ID for you see hundreds of these, and if you look closely the tiny little squares in the wood have them as well. Who knows what this is doing to the water table.





 
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