China’s oil thirst may wrench Canada’s rule of law – the global race for energy

CNOOCWith China‘s Sinopec support, Canadian Premier Minister Stephen Harper‘s conservative government chose a wrong turn to the right, saving itself from a nasty brush with justice.

Approximately 70% of the world’s bitumen (aka “The Tar Sands”) deposits are located in Canada, mainly in the province of Alberta. Totals reserves there are about 176 billion barrels. (Wikipedia)

In Canada, national and provincial governments are scrambling to realise the incomes, once projected and in fact budgeted, that are now threatened by bottlenecks in moving the petroleum to a thirsty world market. Delays and strong controversy in the U.S. about the Keystone Pipeline, now at a standstill, have Canada’s oil producers trying to facilitate alternate (and controversial) shipping routes like a pipeline to the west coast of British Columbia for a projected ramping up in production from 2.2 mbd to 4.5 mbd .

Coupled with that are eye-popping jumps in domestic production levels projected for the U.S. – Canadian oil’s largest consumer – like a projected 25% increase in U.S. production (lead by the explosion in fracking technology) by 2014 and the probability that it could surpass Saudi Arabia as the world’s biggest oil producer by 2020. So who will buy Alberta’s (98% of the nation’s reserves) oil?

Come China and the nation’s thirst for energy…

China is making major international plays for oil supplies to fuel its industrial growth and burgeoning consumer appetite for upward mobility. This does not come without controversy. China continues to use Iran as a major source for petroleum. In Africa, China is pursuing murky oil deals while long-time exploiters (and competitors from the west) of these same third-world resources who tout their “transparency” and humanitarian sensibilities. In Darfur, 70% of the oil production from that war-torn area is routed to China. Be that as it may, China is indeed a real, feisty global competitor for energy resources and its tactics and strategies are on a par with the long-standing producer and development practices model of exploitation.

A relatively sparsely populated nation, Canada has many of those resources. Unlike much of Africa, or even Central Asia and Siberia, Canada has built, up until now, a robust rule of law that assumed government responsibility for First Nations and the environment. What will happen as Canada devolves its legal framework and human rights and panders to a resource-hungry global market?

The Northern Gateway Pipeline (proposed by now China-backed Enbridge) is being funded by Exxon (recently bought by China’s CNOOC) and by Cenovus Energy, a (still) Canadian producer. It’s planned to pump approximately 500,000 bpd to Kitimat on the British Columbia coast from landlocked Alberta.

But there is a big problem with these plans and agendas.

Canada and China have signed an agreement–the “Canada-China Foreign Investment Promotion and Protection Agreement (FIPA)”. By this act, Canada is reneging on binding treaty agreements with First Nations across the country. It is still pending adoption in Canada. Under the pact, foreign investors would be free of parochial regulation by national, provincial, and First Nation governments and in fact would be able to sue and recover “damages” to one investment/development scheme or another in Canadian courts.

Jurisdiction over waterways, rivers, lakes, and the environment is being rescinded as well as the government’s treatied responsibilities to protect First Nation territories and their development. These agreements, under Canadian practice going back to the British Crown, are being reduced or eliminated under a series of omnibus bills, in the Canadian Parliament. At best, the laws will lead to decades of legal and legislative battles across the country. At worst, Canada’s standing as a world leader in equitable governance will crumble. Is this what Canada wants? Is the third-world model of resource exploitation being imposed on the nation by a conservative government desperate to save its hide?

Canada is traditionally seen as a global champion of human rights and the rule of law. Immigrants throng the cities and political refugees from conflicts around the globe often can find a haven in the country. But not so much for the indigenous peoples.

Hidden No More

In this socially networked world, how can sophisticated nations like China and Canada even think slipping expedient, hackneyed agendas into law would go unseen? Global resistance to this is erupting around the planet. The IdleNoMore (Facebook) and movement is daily seeing flash-mob protests as far afield as the Ukraine and Egypt. First Nations Chief Theresa Spence is on day 30 of her hunger strike within sight of Parliament in Ottawa, much to the annoyance of Prime Minister Stephen Harper wants that government-to-government relationship with the Nations to just go away.

Just yesterday at an event at a DC think tank, a young woman next to me who was visiting typed a transcript of the talk on Afghanistan and the Taliban. I saw a tiny red Canadian Maple Leaf flag icon on her laptop. I asked if she was Canadian and she replied that yes, she was. The very first thing that she brought up as we chatted for a minute afterward was the IdleNoMore movement and her annoyance with the tactics of the conservative Harper government.

It is certain that, with broad public support, Canada could use some imagination to nurture cooperation among First Nations and environmentalists to build a model that would do both China and Canada proud going forward. Are these two nations, so important to one another’s futures, capable of forging respect, equity and vision into a world-class standard for an ever more globalized humanity and the resources we all need?

Disclosure: The author is a member of Kahnawake Mohawk Nation
I suggest you read Fallows, James M. China Airborne. New York: Pantheon Books, 2012 for a deeply nuanced account (and relevant to this discussion) of China’s maturing as it grows at a breakneck pace in another world-class arena, aviation.

Categories: Mining & Energy

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8 replies

  1. Reblogged this on Oyia Brown.


  2. Followup by post’s contributing author ( – Canadian activist group posts live tracking of Tar Sands oil shipments from Vancouver terminal and an existing pipeline from Alberta.



  1. China’s oil thirst may wrench Canada’s rule of law – the global race for energy | 2012: What's the 'real' truth?
  2. My posts at China Daily Mail | Suptweet's Blog
  3. Door opens for China’s massive takeover of overseas assets « China Daily Mail
  4. Door opens for China’s massive takeover of overseas assets | The GOLDEN RULE

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