The Oil Drum | Who has to conserve how much?

104 comments on Who has to conserve how much?

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WKO on May 6, 2006 - 2:01pm

The Canadian Federal Government signed away its rights to legislate preferential access or pricing of Canadian crude oil and natural gas when it signed the FTA and successor NAFTA agreements. Further, under clauses in Chapter 6, Canada cannot reduce its exports to the US to meet a shortfall in supply unless it reduces its own consumption in direct proportion.

While Canada produces more than it consumes, it exports most of that production (about 70%) to the US. To meet its own requirements it imports about half of what it consumes from off shore suppliers, primarily Europe. This liability is shared unequally. Western Canada is supplied wholly from Canadian sources (primarily Alberta), while Eastern Canada is supplied primarily from imports. There is currently no crude oil pipeline connecting western and eastern Canada that traverses wholly on Canadian territory; the only east-west connectors pass through the USA.

When it comes to energy, geopolitics can override national self interest, especially for a small nation adjacent to the world's greatest military power. In theory Canada could take back control of is energy supplies by withdrawing from NAFTA, but at what cost? If Canada were to attempt to curtail exports to the US, would the US invoke the Carter Doctrine?

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PhilRelig on May 6, 2006 - 2:21pm

To misquote Mao Tse-Tung (or so I was told when I previously posted this quote):

"The only kind of power that ultimately matters in this world is the power that comes out of the barrel of a gun."

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totoneila on May 6, 2006 - 2:35pm

Hello WKO,

Your points are extremely valid, and as a US citizen: I apologize for what our misguided leaders have done. I encourage Canada to withdraw from NAFTA if your country starts a huge biosolar habitat effort to do your best to extend your remaining supplies for internal use only for decades. This shrinkage in energy shared carrying-capacity to the US will help jumpstart conservation and the building of biosolar habitats in the NE & NW parts of the US, maybe elsewhere inside the US, too. The Carter Doctrine is only enforceable if our military has lots of energy, and the military knows that attacking Canada would be pointless because you could easily have detrito-terrorists constantly blowing up the pipelines and powerlines running south. The US & Canadian military should both understand that setting up mutual Earthmarines to protect the biosolars is much more energy efficient, humane, and protective of biodiversity and existing infrastructure than a continental war.

Bob Shaw in Phx,Az Are Humans Smarter than Yeast?

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Consume More on May 6, 2006 - 6:53pm

Hey man, a deal's a deal. Why even talk about invading Canada? Doesn't it mostly just seem to be another State anyway? Dare I say "puppet on a string?"

Why apologize for US actions? If Canada perceives it's sitting on the short end, who's to blame?

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BrianT on May 6, 2006 - 2:59pm

It is possible US usage could be inhibited by a currency collapse. Canada has to sell to the US at the market price-demand destruction on a major scale will occur in the USA if the currency collapses. It is unclear at this point if US citizens would support a military attack against Canada to seize oil reserves (it is felt to be unlikely).

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totoneila on May 6, 2006 - 4:01pm

Hello Brian T,

I cannot imagine the average US citizen being for our B-52s doing cluster-bombing runs on Canadian cities ala Dresden, nor for a blitzkreig military thrust to secure the Canadian energy resources. I would rather sweat to death in Phx than see our military attack Canada. The US should first prefer internal detrito-civil war between native-energy exporting states [Tx,La, etc] and non-energy states [Wa,Ma, etc] than to us attacking Canada or any other country cutting off our imports [as they inevitably will]. If our country adopts the 'Nuke their Ass--I want Gas' mindset of the '3 Days of the Condor' scenario and is willing to kill Billions for the non-negotiable American way of Life--I am ashamed to be an American. If all Americans understood Peakoil, we would proudly Powerdown from the 9gal/day avg to the Bangladeshi avg of 2cups/day, but Powerup biosolar energies to the maximum. Our wasteful burning of 25% of the world total detritus energy is unsustainable: America has a moral obligation to use this wealth to peacefully lead the world into the next paradigm. We can do it the easy way, or the world will impose it upon us the hard way. How much blood for oil will be lost before we get smart?

Bob Shaw in Phx,Az Are Humans Smarter than Yeast?

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BrianT on May 6, 2006 - 4:27pm

If America's politicians were on the ball they would attempt to bring Canada's resources into the US economy by annexing Canada peacefully. I'm not sure if it would be successful, but a large percentage of Canadians would vote to join up with the USA (mainly the ones that hate the weather).Having said this, the percentage (whatever it is) was far higher before GWB came on the scene.

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BOP on May 6, 2006 - 7:52pm

Surely you are joking!!

Give up our funded health care?? Give up our funded pension system? Give up our system or elected representatives who are actually elected by we the people rather then appointed by wealthy corporate lobbyists and then formalized via the electoral process?

What does the USA have to offer? A society engaged in class warfare where the top 25% of the earners get tax breaks and the bottom 25% go homeless? A country overrun by wacky religious fundamentalists? A country that turns its back on science and such scientific findings as global warming? That undermines its educational system, that has the highest incarceration rate in the world, that has a corrupt and biased press, a militaristic society that engages in jihad and crusade, one that condones and encourages state sponsored terror and undermines global institutions and conventions? Why would we want to be part of this?

My fear is that global warming and NG shortages will combine to make the southern states uninhabitable and Americans will migrate north. But you will not like it here at all, honestly. We are all gay and have abortions on demand, we drink mostly tea and we all speak french and our money looks funny.

Given the billions you are investing in Iraq, I suggest you move there.

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wkwillis on May 7, 2006 - 11:42am

Do you understand that if Canada was annexed by the US, that the Canadians would control American policy by being the swing voters?
We would have the Candian medicine program overnight. Think what more than a dozen senators would do to the Democratic/Republican balance in the Senate.

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LevinK on May 8, 2006 - 12:30pm

No more than Iraq is a swing state now.

Regarding the healthcare - wish I had your optimism! The elites are already busy dismantling the safety net worldwide. USA becoming like Canada - wish that was possible... No, Canada will become like USA, guaranteed.

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WKO on May 6, 2006 - 8:33pm

Americans may find it hard to believe, but few Canadians want to join the US. You should remember that many of the early immigrants to the eastern provinces were "United Empire Loyalists", refugees from the American Revolution. There is a quiet but strong sense of rejection of American vision of the world in many Canadians. If there weren't Canada would have long ago been absorbed into the American Union. We do things diffently here. And don't forget Quebec. Quebecers are more interested in leaving than joining!

Even if Canadians were interested in joining the US, it's unlikely that the current administration would welcome them, since most Canadian provinces would enter as "blue" states. That would upset the current balance of power in the US. It's easier and cheaper for the US to get what it wants by indirect means. Simply threating to slow or halt Canadian (non-energy) exports is enough to terroize Canadian politicians and businessmen into making concessions, but we do tend to be stubbornly difficult about it. There is no need for military intervention.

Most Canadian politicians do not know or are not yet willing to acknowledge it, but energy prices and security are about to become major, divisive issues. When the Canadian government attempted to introduce a two price system and energy security strategy in response to the seventies energy crisis -- the National Energy Policy -- Alberta rose up in arms. There is no dirtier word in Alberta than "NEP".

At that time Albertans promised to "let the eastern bastards freeze in the dark". In a sense, NAFTA has become the instrument to make good on that promise. Albertans may yet get their wish.

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astronomer1 on May 6, 2006 - 7:41pm

Why should Canada be expected to obey NAFTA agreements when the US has not met agreements on the importing of lumber from Canada?

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dinaz on May 8, 2006 - 8:59am

Until this clause in NAFTA is actually challenged it is difficult to say whether it will be honoured or not. Energy has already been invoked as a possible means of retaliating against US' softwood trade barrier - it is very very unilkely to be used. Most operations in ALberta/BC are US owned and the simple fact is that Americans have the cash to pay top dollar and, oh yeah, pipelines in place to ensure prompt delivery payment and return on investment. There just ain't no better customer. Personally I don't see the NAFTA deal as much of a problem for Canada. So long as we are a net exporter high domestic energy prices will encourage further conservation. This is simply necessary given the eventual realities all human society will face. Of course it is possible that the US will seek to control Canada more directly than it already thinks it does. Any increase of political control will be heavily resisted by domestic US industries since they are the primary shareholders in our economy and don't want to be undermined by their own government's market intervention. Then there's the fact that like any proud citizen of a distinct nation there will be resistance. Some may say we'd fight for oil, water and wheat but this would only be a means to the end of self determination. When push comes to shove over material resources could our red, white and blue brothers engineer a little 21st century Anschluss of Canada? They haven't won a war against us so far...

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