Thwarted on US oil pipeline, Canada looks to China

By Rob Gillies

Associated Press

Published: Saturday, Jan. 28 2012 12:00 a.m. MST

FILE - In this Monday, Aug. 22, 2011 file photo, environmental activists gather outside the White House in Washington as they continue a civil disobedience campaign against a proposed oil pipeline from Canada to the U.S. Gulf Coast. The plan was blocked by the Obama administration in January 2012, citing environmental grounds.

J. Scott Applewhite, Associated Press

KITAMAAT VILLAGE, British Columbia — The latest chapter in Canada's quest to become a full-blown oil superpower unfolded this month in a village gym on the British Columbia coast.

Here, several hundred people gathered for hearings on whether a pipeline should be laid from the Alberta oil sands to the Pacific in order to deliver oil to Asia, chiefly energy-hungry China. The stakes are particularly high for the village of Kitamaat and its neighbors, because the pipeline would terminate here and a port would be built to handle 220 tankers a year and 525,000 barrels of oil a day.

But the planned Northern Gateway Pipeline is just one aspect of an epic battle over Canada's oil ambitions — a battle that already has a supporting role in the U.S. presidential election, and which will help to shape North America's future energy relationship with China.

It actually is a tale of two pipelines — the one that is supposed to end at Kitamaat Village, and another that would have gone from Alberta to the Texas coast but was blocked by the Obama administration citing environmental grounds.

Those same environmental issues are certain to haunt Northern Gateway as the Joint Review Panel of energy and environmental officials canvasses opinion along the 1,177 kilometer (731 mile) route of the Northern Gateway pipeline to be built by Enbridge, a Canadian company.

The fear of oil spills is especially acute in this pristine corner of northwest British Columbia, with its snowcapped mountains and deep ocean inlets. People here still remember the Exxon Valdez oil spill of 1989, and oil is still leaking from the Queen of the North, a ferry that sank off nearby Hartley Bay six years ago.

The seas nearby, in the Douglas Channel, "are very treacherous waters," says David Suzuki, a leading environmentalist. "You take a supertanker that takes miles in order to stop, (and) an accident is absolutely inevitable."

Prime Minister Stephen Harper says Canada's national interest makes the $5.5 billion pipeline essential. He was "profoundly disappointed" that U.S. President Barack Obama rejected the Texas Keystone XL option but also spoke of the need to diversify Canada's oil industry. Ninety-seven percent of Canadian oil exports now go to the U.S.

"I think what's happened around the Keystone is a wake-up call, the degree to which we are dependent or possibly held hostage to decisions in the United States, and especially decisions that may be made for very bad political reasons," he told Canadian TV.

Republican presidential candidate Newt Gingrich quickly picked up the theme, saying that Harper, "who, by the way, is conservative and pro-American ... has said he's going cut a deal with the Chinese ... We'll get none of the jobs, none of the energy, none of the opportunity."

He charged that "An American president who can create a Chinese-Canadian partnership is truly a danger to this country."

But the environmental objections that pushed Obama to block the pipeline to Texas apply equally to the Pacific pipeline, and the review panel says more than 4,000 people have signed up to testify.

The atmosphere has turned acrimonious, with Natural Resources Minister Joe Oliver claiming in an open letter that "environmental and other radical groups" are out to thwart Canada's economic ascent.

He said they were bent on bogging down the panel's work. And in an unusually caustic mention of Canada's southern neighbor, he added: "If all other avenues have failed, they will take a quintessential American approach: Sue everyone and anyone to delay the project even further."

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