Amid soaring U.S. domestic petroleum output, controversy has been building over the oil industry's demands for an end to the federal ban on exports of crude oil. In Canada, the nation's progressive movement uses the same anti-export argument against the Keystone XL pipeline. But if you think that progressives on both sides of the border see oil and pipelines the same way, think again.
In a development virtually unnoticed in the U.S. media, Canada's left-of-center New Democratic Party (NDP) has swung away from opposition to tar sands development and has embraced what is globally known as "resource nationalism."
The NDP opposes both the Keystone XL, which would go from the tar sands to Texas, as well as the Northern Gateway pipeline from the tar sands to the British Columbia coast -- yet not primarily because of their environmental risks but because the pipelines would export raw crude instead of value-added refined products. At the same time, the NDP strongly supports a plan for an all-Canadian pipeline, the Energy East, a 2,800-mile project that would send tar sands bitumen to refineries in Quebec and New Brunswick for supply to domestic and export markets.
And if you think the NDP's support for Energy East subtly reinforces one of the key arguments of Keystone XL supporters -- that the tar sands oil will find a way to get out to market, hell or high water and with or without Keystone XL -- you're right.
The NDP is little known in the United States but is a big deal north of the border. It is the second-largest party in Parliament after the ruling Conservatives, and it received 30.6 percent of the vote in the 2011 federal election. It is roughly analagous to the Elizabeth Warren wing of the U.S. Democratic Party.
“When we talk about sustainable development of our resources in Canada, we talk first and foremost about adding the value here, including the jobs,” he said Thursday.
“Keystone XL represents the export of 40,000 Canadian jobs. So as a matter of principle, we’re saying, since that bitumen is moving anyway, move it in Canada, create 40,000 jobs here, get a better price for the producers, more royalties for the producing provinces – oh, and by the way, take care of Canada’s energy security.”
(...) “As a matter of principle between something like Keystone XL, which as far as we’re concerned is a big mistake, and west-east, west-east is a better alternative,” he said.
At a minimum, Mulcair said, building the pipeline in Canada would create jobs here instead of south of the border. And domestic refining capacity could be expanded over the longer term, he added.
“As a matter of principle with regard to natural resources, we’ve got to move away from the traditional Canadian tendency to simply rip and ship and not add value here. Value-added jobs are the way to go.”
From an American progressives and environmentalists, it's a contradiction in terms. But for the Canadian left, it's simply Canadian.
Environmentalists are fighting back. The Pembina Institute, a Calgary think tank, released a report Feb. 6 (the same day as Mulcair's speech) projecting that Energy East would sharply raise Canada's greenhouse gas emissions by the equivalent of 7 million additional cars. First Nations along the pipeline's route are using their legal leverage over the permitting process to demand a big share of the project's revenues.
But Energy East is supported by Prime Minister Stephen Harper, a Conservative. Harper's government and oil industry spokespeople have pointed out that 96 percent of Canadian crude exports go to the United States, thus fetching a much lower price than it would receive on the open market globally. By providing for tar sands oil to be refined in Canada rather than exported as crude, Energy East gains a left-right base of support that is stronger than other pipeline projects.
Despite the inevitable regulatory delays and stretched-out process of First Nations consultations, Energy East's chances seem bright. For better or worse, the project has a huge advantage politically -- it flies the red-and-white flag of Canadian nationalism.