The Liberal government used Earth Day earlier this week to announce what’s widely viewed as the most ambitious climate action plan in the country’s history. Canada now plans to reduce emissions by 40 to 45 percent below 2005 levels by 2030. Only we haven’t heard much about the government’s 2019 promise on the so-called “just transition” to a post-oil economy.
Part of the reason for that is political—the feds don’t want to further inflame anti-Ottawa sentiment out west, where massive job losses in the oil and gas sector have given rise to a nasty petro-nationalism.
United States President Joe Biden’s decision in January to cancel the Keystone XL pipeline sent shock waves through Canada’s oil and gas sector.
The project, which was slated to carry some 830,000 barrels per day of oil sands crude from Alberta to refineries in the Gulf Coast, was a wake-up call for the fossil fuel industry. But for Canada’s petroleum producers there’s more trouble coming down the pipe.
Michigan’s Democratic Governor Gretchen Whitmer has ordered Calgary-based Enbridge to shut down the operation of its Line 5 by next month. The 1,032-kilometre, dual pipeline carries some 2.5 million barrels of petroleum products per day (twice the proposed capacity of Keystone XL) to customers and refineries in the U.S. Midwest, including some 40 percent of the oil and gas processed at refineries in Sarnia, Ontario.
In a lawsuit filed against Enbridge, the state alleges that continued operation of the pipelines, which run underwater in the Straits of Mackinac connecting Lake Michigan and Lake Huron, poses an “unreasonable risk” to the Great Lakes. The suit says that Enbridge’s “persistent and incurable violations” of structural problems with the pipeline “imposed on the people of Michigan an unacceptable risk of a catastrophic oil spill in the Great Lakes that could devastate our economy and way of life”.
According to court filings, the Great Lakes are responsible for some 350,000 jobs in Michigan and generate some $1.2 billion a year in tourism revenue. Enbridge counters that the State can’t order the pipeline shut down based on the potential risk of a break, despite the fact the pipeline is 67 years old. The federal government has intervened on Enbridge’s behalf saying the shutdown of the pipeline is “non-negotiable.”
But Enbridge’s reputation precedes it—the company is responsible for the largest oil spill in Michigan history in 2010 when a section of its Line 6B ruptured and spilled some 1 million gallons (U.S.) of heavy crude contaminating a 40-kilometre stretch that feeds the Kalamazoo River. Clean-up of the river, which would take five years, cost more than $1.2 billion, making it the most expensive clean-up in U.S. history.
Greenpeace Canada climate campaigner Keith Stewart says signals coming from the U.S. should be a recognition of the fact that the days of sucking black tar out of the earth for fuel are numbered when you do a cost-benefit analysis. “We’re going to be producing less oil—and soon,” Stewart says. “So who exactly is going to be buying the oil?”
Enbridge actually has approval from the state to build a tunnel to replace Line 5. But the completion of that project is years away. And while some—in particular Conservative Party leader Erin O’Toole—have raised alarms about job losses in Sarnia over the proposed shutdown, in the short-term it will only mean Enbridge having to reroute some of the crude being carried by Line 5 now through other pipelines in the vast web of lines in the Great Lakes Basin.
The fact is, Stewart says, we don’t need the pipelines we have now given declining demand for oil and gas. Yet we continue to build them, stuck in the belief that only through building more infrastructure can we save jobs—even though the oil and gas sector accounts for some 2 per cent of employment in Canada.
That’s not a small number, but not the billions we’re spending on building pipelines like Trans Mountain, for example, when that money could be better spent helping oil and gas workers transition into green energy jobs.
But Stewart says it’s time to have a frank discussion with Canadians. Yes, the shift will be difficult for workers but CERB supports like we saw in the early weeks of the pandemic could be a starting point for a way to ease the transition for those put of the oil and gas sector.
European countries have recognized the need for a shift away from oil and gas. So has the automotive industry in Canada with its move to electric vehicles.
Stewart says that the need for climate action shouldn’t be seen as an attack on the oil sector. He says that “It’s the direction we need to be headed if our economy is going to survive.”