Canada's northern natural gas pipeline project stirred up a hornet's nest of environmental protest when roving regulatory hearings made their sole foray into a big southern city, but project sponsors didn't shrink from the swarm.
Conservationists were rebuffed by a blunt rejection of their theory that the arctic natural gas scheme is a ploy by the Alberta petroleum industry to fuel its oil side. The protesters were told the oil sands rush of about C$100 billion (US$85 billion) in thermal bitumen extraction and processing projects will continue even if they delay or stop construction of the arctic gas development.
The two major branches of the fossil fuels industry are developing independently, Imperial Oil Ltd. executive Randy Ottenbreit testified at Edmonton hearings of the environmental joint review panel on the Mackenzie Gas Project.
He made the statement after green organizations mounted a flurry of protests in the Alberta capital, claiming the arctic project aims to tap clean Mackenzie Delta gas as fuel for polluting Alberta plants dedicated to exporting oil to the United States. The Edmonton hearings drew 26 interveners, led by national and international environmental societies.
By focusing on northern effects of the proposed Delta wells and 1,200-kilometer (750-mile) Mackenzie Valley Pipeline -- not least by staying in the Northwest Territories -- the regulatory review has overlooked national and international climate change caused by accelerating greenhouse-gas emissions, the protesters warned.
"Mackenzie gas will fuel expansion of the Alberta tar sands," predicted Stephen Hazell of the Sierra Club's Canadian branch. "The panel must assess global warming and other impacts associated with using Mackenzie gas to produce the most carbon-intensive oil on the planet," his group said, adding to the barrage of criticism.
"Assessing the impact of the pipeline without assessing the global warming impact of the gas it carriers is like trying to pretend cake doesn't have calories," said Julia Langer of the World Wildlife Fund's Canadian chapter. "Science tells us we need to be on a low-fossil fuel pollution diet. Consideration of a massive project that will increase greenhouse gas emissions all the way from arctic wells to California wheels -- without a rational, continental, sustainable energy strategy to guide it -- is totally unacceptable."
But arctic gas will be no different from other production flowing through about 1,200 entry and exit points on TransCanada PipeLines Ltd.'s Nova grid for collecting and distributing supplies from Alberta and British Columbia, Ottenbreit said.
Northern gas will cross Alberta into a North America-wide pipeline network to heat homes and businesses, generate power and become raw material for petrochemicals and plastics, he predicted. Imperial leads the Mackenzie Gas Project consortium.
Alberta oilsands plants have done without arctic gas since Suncor Energy Inc. started up the first one in 1967 and new bitumen projects will continue to be built regardless of whether they can obtain northern fuel, Ottenbreit said.
Within hours a separate joint review panel of federal environmental authorities and the Alberta Energy and Utilities Board approved an Imperial entry in the oilsands lineup. The decision authorized construction of the company's C$7 billion (US$6 billion) Kearl bitumen mining project about 70 kilometers (45 miles) north of Fort McMurray. The development plan calls for three 100,000 b/d stages.
Growth of the overall North American gas market drives the northern pipeline project, Ottenbreit told the arctic gas hearings. The continent's gas consumption is forecast to rise by more than one-third to 100 Bcf/d over the next 25 years, he added.
Projected oilsands use of up to 2 Bcf/d will only be 1-2% of total gas demand, he said, noting that even if the bitumen boom ended there would be a growing need for northern gas. The only caveat put on the project by its owners was economic rather than environmental. Arctic gas will only reach market if the consortium remains convinced the new northern supplies will be reliably competitive with liquefied natural gas from overseas.
The environmental critics were not convinced. Arctic gas will "quite likely" be used by oilsands projects, insisted Lyn Gorman, of the Council of Canadians. All of the Mackenzie project's sponsors -- Imperial, Shell Canada Ltd., ConocoPhillips Canada and ExxonMobil Canada -- also own interests in growing oilsands developments, Gorman emphasized.
Environmental critics who agreed with Gorman dominated the Edmonton roster of interveners who lined up to address the seven-member review panel of federal, Northwest Territories and aboriginal authorities. After 14 months of hearings, the environmental review is still at least four weeks away from completion and its C$10 million (US$8.5 million) budget will almost certainly be exceeded, panel officials said. The Mackenzie project owners are covering two-thirds of the review's expenses.
The joint panel will eventually report findings and recommendations to the National Energy Board, which has finished hearing evidence on economic, engineering and safety issues but continues to deal with procedural and jurisdictional issues. After 14 months of often critical and sometimes heated panel sessions, Mackenzie project leader Imperial Oil showed no signs of being ruffled by the Edmonton outpouring of protest.
"Most environmental effects will occur during construction but will be managed so that they are localized and short-term," Imperial said in a written submission to the Edmonton hearings. "Project effects on air, water, land, fish or wildlife will not last a long time or affect a large area."
But for the three-year duration of the mammoth construction effort, effects on the Alberta economy are forecast to be large and the project has generated considerable support outside the circle of environmental groups critical of the project.
New cost estimates are being generated. Currently the project expects to spend C$3.1 billion (US$2.6 billion) on Alberta supplies and services. The money is forecast to support more than 70,000 jobs and generate C$2.6 billion (US$2.2 billion) in wages in fields from "direct" employment, such as welding pipe, to "induced" work, such as selling boots to construction tradesmen.
Southern environmental criticism has yet to erode support for the gas project by its northern aboriginal part owners, including the Inuvialuit, Gwich'in and Sahtu Dene of the Mackenzie Delta and central Mackenzie Valley. At recent "socio-cultural impacts" hearings in Inuvik, the Gwich'in Tribal Council assured the review panel that northern communities most affected by the development plan can take care of themselves.
"Gwich'in has invested a great deal of time and effort to ensure we are ready to be full participants in the Mackenzie Gas Project," the council said. "We feel we can manage our own affairs and have set out a plan to do so. We understand how we can use the tools provided to us."
Northwest Territories political leaders were planning to respond to the Edmonton outpouring of environmental alarm within a few days.
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