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Canada lags behind resource boom
Gary Park For Petroleum News
Canada’s pace of natural resource development has been outstripping measures to protect the environment, the government’s Environment and Sustainable Development Commissioner Scott Vaughan said Feb. 5.
In a series of audits that wraps up his five-year appointment, he was critical of the government’s efforts to safeguard ecosystems from oil spills, the use of toxic chemicals and the rapid increase in hydraulic fracturing.
Vaughan said that “given the central role of natural resources in the Canadian economy, it is critical that environmental protection keeps pace with economic development. I am concerned by the gaps we found in the way federal programs related to natural resources are managed.”
The findings coincide with a host of major developments, including expansion of Alberta oil sands production, greater use of hydraulic fracturing in shale oil and gas deposits and pipelines to support the export of bitumen and LNG to Asia.
Audit sees imbalance He identified an imbalance between government financial incentives for the petroleum industry and what it is doing to protect the environment, noting that although the level of federal subsidies is declining, the Canadian government over the past four years has made more than C$500 million in direct grants for research and development and given C$1.47 billion in tax breaks, mainly involving accelerated write offs for oil sands producers.
But the government has failed to establish more protected marine areas even as offshore resource development proceeds, he said.
The audit also said the federal-provincial offshore petroleum boards in Newfoundland and Nova Scotia lack coordination in monitoring oil and gas activities and are “not systematically tracking measures to prevent or reduce environmental impacts.”
Vaughan also urged the government to develop a better understanding of the risks associated with hydraulic fracturing given that the 200,000 fracking wells in Canada are expected to double in the next 20 years.
The audits were issued a week after Environment Minister Peter Kent said the government is on the verge of introducing “significant” changes to liabilities for offshore spills, which are currently C$40 million for the Beaufort Sea and C$30 million for the Atlantic Coast.
Government sources have said the liability cap could be raised to “billions of dollars” and that the industry would have to either buy insurance or self-insure.
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