In the first quarter of 2009, with the world reeling from a global financial meltdown and entire nations declaring bankruptcy, the world’s largest oil companies (Big Oil) were reeling in some of their largest quarterly profits ever. The real irony is that while terms like “sub-prime mortgage” and “credit” crisis were being bandied about, this colossal collapse was being induced by the very same Big Oil and their hedge fund friends – in a rush to exploit one of the craziest debacles of our time – the Alberta Tar Sands.
The single largest industrial project in human history – the Alberta Tar Sands is likely to become the most destructive – if ongoing plans for investing hundreds of billions of dollars in their expansion continue.
Often called “The Saudi Arabia of the North,” the Tar Sands are the largest untapped oil reserves in the world, with potentially over 2 trillion barrels of oil in an area the size of the state of Florida. Since the start of the war against the Iraqi people, the Tar Sands has emerged as the number one source of US oil supply – a supply that comes at massive cost to planet and people. Located on Sovereign First (Indigenous) Nation territories, the extraction of tar sands crude oil serves to entrench Canada’s colonial legacy of destroying Indigenous communities and alienating them from ecosystems they have protected for millennia.
The Tar sands also represents:
? The most rapid-growing industrial climate change threat in North America – tar sands crude represents three times the carbon-intensity of conventional oil production.
? One of the highest deforestation rates on the planet (second only to Amazon rainforest destruction)
? Massive destruction of rivers and waterways – for each barrel of oil – five barrels of water are used. Additionally, for every barrel of oil produced, 4 barrels of toxic water are dumped into tailing ponds that have now flooded hundreds of thousands of acres of forest and peat-lands.
? Severe toxic impacts on Boreal wildlife and ecosystems – by now you’ve all heard the story about the 500 ducks that died on one of the toxic tailing ponds.
? Severe health impacts to local frontline (mostly Indigenous) communities, including high incidences of rare, often fatal, diseases.
? A massive drain on Canada’s public purse – a massive theft of Indigenous property.
How This Destruction Was Staged
Asking why such an industrial nightmare was allowed to happen is a moot point when facing the wealthiest, most powerful and least regulated corporations on the planet. What may be more revealing is how they went about creating it.
Since the rise of oil prices started in 2004, every major western oil company has jumped aboard the Tar Sands. This has also spurred the largest build-out of oil refineries and pipelines that the U.S. has seen in over 25 years. In order to gain both political and market support for this most expensive oil extraction scheme in the world, Big Oil got the ball rolling for the next round of NAFTA negotiations – the Security and Prosperity Partnership (SPP) and lined up some of their wealthiest friends on the planet to help prepare the markets.
NAFTA, Deep Integration and the SPP
Since the North American Free Trade Agreement (NAFTA) was ratified in 1994, it has primarily served to allow multinational corporations better access to valuable natural resources across the borders of Canada, U.S. and Mexico by eliminating any policies protecting the public interest. Under NAFTA, Canada cannot a) sell national energy resources at rates lower than sold to the U.S. and b) reduce Canada’s levels of export to the U.S. (NAFTA proportionality clause). As a result, Canada now exports 70 per cent of the oil and 61 per cent of the natural gas it produces each year to the United States while having to import 55 per cent of its domestic oil needs from Algeria, Venezuela and Norway. This monopoly of Tar Sands crude has been effectively sold to the U.S. Administration as a key strategy to establish U.S. energy “security” and “independence”.
Big corporations on both sides of the U.S.-Canada border continue pushing for further deregulation of their activities, lobbying for “deep integration” – a term used to define the dismantling of borders between Mexico, Canada and the United States and harmonizing (or neutralizing) policies governing food, water, energy, services and consumer commodities . One of the central strategies of the SPP is to expedite the infrastructure required to quadruple current tar sands oil supply to key industrial hubs in the U.S. Where military and business empires find common cause, speculative capital is quick to follow.
War, Oil Prices & Global Economic Crisis
Big Oil’s control of planetary oil is as fundamental to the war economy, as industrial pollution is to climate change – acceptance of the former has not required a global scientific consensus. Hence, the assumption that an escalating war would boost oil consumption and demand that had otherwise stagnated in recent years is normal. Meanwhile, OPEC countries were enforcing caps on oil production and raising royalty rates – claiming a greater portion of revenues for the public purse under their nationalization programs. This served to dramatically reduce the global market share of Big Oil and in a desperate bid to regain this market share these companies began to seriously look to all remaining unconventional oil sources – the tar sands looked the most promising.
The only problem was that, despite the war effort, extraction of this oil remained expensive. In order for tar sands to be truly profitable, prices needed to jump significantly. And this is where Big Oil’s buddies on Wall Street stepped in. In coming years, there may be a growing number of queries about how oil price surges were largely induced through long positions taken by hedge funds. North American banks did their share by sending signals about “one of the most promising long-term themes buoyed by the rapid industrialization of emerging economies” – citing attractive value, return on equity and profit momentum from investment in oil drilling, refineries and marketers.
In short, Big Oil obtained the capital support required – and guided an investment frenzy squarely focused on figuring out how to get the dirtiest oil out of the hardest-to-reach places.
How We Stop this Insanity – Mobilizing a Network of Allied Communities
Communities across North America are rising up to take on the world’s richest, most powerful forces. A handful of small First Nations communities are leading the resistance in Canada. However, like many of their allied communities fighting refinery expansions and pipelines in the US, these folks lack the funding typically provided white NGOs. What makes them strong is their experience – history of resistance, ties to the land, and the futures of their children. However, just as Mother Earth needs their resolve, they need our support and solidarity.
Resistance has to be strategic. In short, seek to cut off the three factors of production:
1. Land – Don’t let the oil flow South
2. Labor- Build resilient communities with organized workforces
3. Capital. – Raise the costs of doing business
1. Land: The Tar Sands cannot expand without access to land…. pipelines by land and refineries on land. There are already a number of communities and groups in the U.S. opposing the plans, proposals and construction of this infrastructure. One may be in your very own backyard – seek them out and help them organize. If you need help finding them or need more on the Tar Sands: contact:
Indigenous Environmental Network: http://www.ienearth.org/cits.html
Global Community Monitor: http://www.gcmonitor.org/
Rising Tide North America: http://www.risingtidenorthamerica.org
Oil Sands Truth: http://oilsandstruth.org/
2. Labor: Unlike the big forest defense battles of the 80s and 90s, this engagement has many allies waiting to be engaged. Organized workers know that the writing is on the wall for refinery jobs. They also know that when the well runs dry, the Man ain’t stickin around. Its time that rank and file unions step up to their militant traditions – while the plants are still running. While they are – “The Boss needs you. You don’t need him!”
This is a time for change, not reform. Communities that take on Big Oil need to be communities that are willing to reclaim their economy – starting with a commitment to the poorest amongst them. Frontline communities need to awaken the sleeping giant in the House of Labor to discuss their common burden (health impacts) and promised benefits (just transition to green jobs). Find a union local near you…then find your local Environmental Justice group. And always remember – “An injury to one is an injury to all”
Some relevant labor centrals:
Communication, Energy & Paperworkers: http://www.cep.ca/
United Steelworkers: http://www.usw.org/
3. Capital: Even the richest (Big Oil) still need other streams of capital to build out the billion-dollar hardware downstream. Go after the banks, the investors and the insurers. In their time of shame, they have no further business gambling with people’s lives. While scaring away investors and insurers, remember to point out that Big Oil companies are the primary drivers of the economic collapse and should be held accountable – alongside Wall Street. For creative ideas check out: www.dirtymoney.org
While all of the above serve to raise the cost of doing business, there is one durable strategy for seriously equalizing cost for the planet – mass direct action. Mass direct action forced the elimination of subsidies to the Nukes in the 80s. This is what will effectively turn the tide against coal and Big Oil. A good place to plug into mass direct action would be this year’s Climate Action Camps – the West Coast camp will be targeting the Chevron Oil refinery in Richmond, Ca.
For more on Mass Action:
Climate Convergence: http://www.climateconvergence.org/
Mobilization for Climate Justice: http://actforclimatejustice.org/wp/