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Pivotal decisions pending on resources in Canada’s coastal waters East is East and West is West and the twain are meeting in Canada around the issues of the environment and land claims Gary Park PNA Canadian Correspondent
Two of Canada’s richest waters, while separated by six time zones, are immersed in the final rounds of a pivotal clash between big oil and government, on one hand, and coalitions of environmentalists, fishermen and aboriginals, on the other.
Within the next few months, regulators take crucial decisions on the eventual future of Georges Bank off Nova Scotia and the Queen Charlotte Basin off British Columbia’s northern coast. The verdicts are bound to be inflammatory as the pressure builds to lift moratoriums on exploration and development of two of Canada’s most inviting oil and gas deposits.
For the petroleum industry, the two regions represent an opportunity to extend or open up new frontiers. For both the Nova Scotia and British Columbia governments, the oil and gas potential represents a viable and long-term economic alternative to ailing forestry, fishing and mining sectors.
But for the federal government, Georges Bank and Queen Charlotte are an impossible challenge in satisfying those conflicting interests. While reluctant to show its hand conclusively, the British Columbia government continues edging towards lifting a 13-year moratorium on exploration of the 55 million acres of Queen Charlotte basin, where the oil and gas reserves may be 15 times greater than those of the 615-million-barrel Hibernia field off Newfoundland. British Columbia potential vast In recent months, British Columbia Energy Minister Dan Miller has engaged in a nervous shuffle as he tackles the recommendations of a task force representing communities of northern British Columbia, who insist that opening up the basin to oil and gas exploration is their last, best hope of economic revival on any worthwhile scale.
With its own approval rating stuck around 10 percent, the British Columbia government is desperate to find remedies to Canada’s worst-performing economy of recent years, acknowledging that its mainstay fisheries, forests and mines have little chance of an early turnaround and may even be irretrievably off course. That leaves just oil and gas, where the province has taken bold steps over the last year to lower royalties and ease land use regulations as it pursues C$25 billion in new investment and a doubling of production by 2008.
The petroleum potential of the area near Prince Rupert and around the Queen Charlotte Islands is vast, according to a Geological Survey of Canada report issued in 1998. Total reserves are estimated at 9.8 billion barrels of oil and 46 trillion cubic feet of gas.
Support for the task force’s campaign has gathered momentum over the last two years since a report quietly commissioned by the province gave its full backing to development.
The Canadian Ocean Frontiers Research Foundation concluded that the moratorium, imposed in response to worries of a second Exxon Valdez, is no longer needed. “In broad terms,” the foundation said, “it has been found that technological progress and regulatory requirements for equipment and safety certification have alleviated many of the panel’s concerns to do with seismic surveying and drilling operations.” Haidas take case to court Miller said the province agrees it has an “obligation to examine” the issue of exploration in the region and has promised an early response. His hesitancy stems from a certain knowledge that other environmentalists and 6,000 Haida Indians are mounting strong opposition to the development proponents.
To that end, the government is holding talks with five aboriginal tribes to draft referral procedures for oil and gas applications that will respect treaty rights. But the Haida have undermined that effort by abandoning formal negotiations on their claim to 3,600 square miles of land and ocean and taking their case to court.
Haida president Ron Brown said government talk of allowing exploration triggered the land-title lawsuit. “We’ve got nothing against progress; we just want to be part of it,” he said. He was adamant that, apart from the overall land claim, there must be agreement on management of fisheries, forests and shellfish aquaculture before exploration is permitted.
The Haida’s stance is further strengthened by a landmark Supreme Court of Canada ruling last year which confirmed natives’ title to their traditional lands and said courts could be forced to resolve disputes if negotiations with governments fell through.
The Sierra Club has warned of “incredible” resistance to opening the offshore resources to development. “We’ve had oil spills creating total havoc on our marine life,” a spokeswoman said. “It would be a time bomb waiting to explode.” She said the area is an earthquake zone, creating the risk of a massive disaster.
Meantime, Chevron Canada Resources, with 12 million acres, Shell Canada and Petro-Canada all hold leases in the Queen Charlotte basin and favor some certainty over the future of those lands.
A spokesman for Chevron, which has a deal with Shell to do more exploration, said his company is reluctant to get involved in the public debate without some positive signals from both the British Columbia and federal governments.
“We’re not going to raise the specter of exploration unduly if we think the governments are going to say ‘you guys are absolutely nuts, we’re never going to lift the moratorium,’ ” he said. “But if the moratorium was lifted, sure, we’d be interested.”
Federal Natural Resources Minister Ralph Goodale said he is prepared to discuss development if British Columbia raises the issue, but indicated some support for exploration if companies are ready to abide by the recommendations of a mid-1980s federal-provincial panel which suggested imposing 92 conditions before exploration took place. Also East Coast conflicts Environmentalists and fishermen are also pitted against petroleum companies on the East Coast, where a panel appointed by the federal and Nova Scotia governments is holding public hearings to examine the environmental and socio-economic impact of petroleum exploration on Georges Bank. The panel must deliver a recommendation by July on whether to end, or extend the exploration ban when it expires Jan. 1, 2000.
The Canadian Association of Petroleum Producers, along with leaseholders Chevron, Amoco Canada and Texaco Canada, wants a 1998 moratorium lifted, arguing the impact on marine life can be mitigated. A coalition of environmentalists and fishing organizations has called for a 12-year extension on the drilling freeze, arguing exploration work could discharge toxic substances into a fishery worth C$100 million a year.
The bank, covering 27,000 square miles of sand-bottomed shallows, actually straddles the Canada-U.S. boundary — a complicating fact for Canadian regulators since President Bill Clinton ruled the U.S. portion off-limits to exploration until 2012, as part of a wider ban covering offshore leases outside the Gulf of Mexico. Reserves estimated at 2 billion barrels David Lincoln, a geologist working for the Massachusetts Fishermen’s Partnership, warned the joint federal-Nova Scotia review panel that if Canada lifts the moratorium and a spill occurs the United States “will not forget.”
No well has yet been drilled on the bank, but the Geological Survey of Canada has estimated reserves at 2 billion barrels of liquid hydrocarbons and 10 trillion cubic feet of gas — numbers it believes could soar if the industry gained permission to use its latest drilling techniques.
Debora Walsh, CAPP’s East Coast manager, said the industry accepts Georges Bank is a special place, but “that doesn’t mean you can’t have the oil and gas industry and the fishing industry coexisting.”
She said strict regulations by the Canada-Nova Scotia Offshore Petroleum Board limit the release of oil-based drilling lubricants to 15 percent of the total discharge. In addition, technological advances in areas such as seismic and drilling techniques mean less time is spent drilling fewer wells. Scientists, however, have countered that any releases are highly toxic to scallops, lobster and haddock, while seismic blasts may pose an even bigger danger.
CAPP’s director of strategic planning Chris Peirce said the panel’s verdict is important because of the 350 trillion cubic feet of gas reserves some experts believe the Nova Scotia offshore contains. It is that prospect of a domino effect that has opponents worried about an open season on all fish-rich areas.
Peirce told the review panel that the current moratorium is a “regulatory blanket that suffocates economic activity.” He argued it was the job of governments to apply their regulatory structures and balance the different priorities of economic interests.
Canada’s offshore petroleum industry was in the process of establishing itself and “we are concerned about getting the principles right as development unfolds.” CAPP also contended that the U.S. offshore moratorium was not connected to Georges Bank, where there was no specific process of assessment. Peirce said the United States was more concerned about activity in the mid-Atlantic and West Coast.
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