At a time when Canadian officials are aggressively defending TransCanada's Keystone XL pipeline project, Alberta's Energy Department is quietly considering an Arctic alternative to carry their bitumen to market.
The department is spending $50,000 to study the pros and cons of building a pipeline from Alberta's oil sands extraction sites north to the small native hamlet of Tuktoyaktuk along the shores of the Beaufort Sea in northwest Canada.
The study, which is being conducted by the Calgary consulting firm Canatec Associates International, is the most recent option that the Alberta government has floated in its effort to ship oil sands crude to the world market.
"One of the biggest challenges we have here in Alberta is to get our product to tidewater and to markets where they can fetch a fair price for the resource," noted Energy Department spokesman Mike Feenstra.
"This is a feasibility study just to see if it makes any sense economically and what, if any, the physical limitations would be," Feenstra added. The final report is due this fall.
The oil sands pipeline would have to cross roughly 2,000 miles of Arctic tundra and wetlands to get to Tuktoyaktuk, population 930. The village's natural harbor would have to be upgraded to accommodate the increased commercial activity.
Tanker traffic would probably be limited to the summer months because the Beaufort Sea is iced in for much of the year. However, warming temperatures are keeping the Arctic ice-free for longer periods each summer.
A pipeline is likely to be welcomed by local government officials who are eager to develop the Northwest Territories' oil and gas reserves.
"The government of the Northwest Territories has expressed some interest in seeing more projects and development and would be interested, as well, in seeing what this report would say," Feenstra said.
But environmentalists vow to oppose the Tuktoyaktuk pipeline.
"Opposition to tar sands pipelines in the U.S. and Canada have obviously forced the government of Alberta to look at alternatives to pipe some of the dirtiest oil on Earth to one of the Earth's most vulnerable environments," said Danielle Droitsch, director of the Natural Resources Defense Council's Canada Project.
"Does it make sense to pipe tar sands to the Arctic? No. Is it evidence they are taking desperate measures because they have few alternatives? Yes," she added.
Is there support?
Droitsch said Northwest Territories residents are not likely to support the pipeline because of its potential impacts on groundwater in the region.
Environmental groups that are fighting the proposed Keystone XL pipeline are also campaigning against several other pipeline projects that would ship oil sand bitumen to Canada's east and west coasts.
Enbridge Inc. has proposed construction of the $6 billion Northern Gateway oil pipeline, which would carry 525,000 barrels per day of oil sands crude to the port of Kitimat in British Columbia on Canada's west coast.
But the fate of that project could depend on the results of the May 14 provincial elections. Polls show that the left-leaning, anti-pipeline New Democratic Party could prevail, essentially halting work on the gateway project (EnergyWire, April 18).
Enbridge is also considering reversing its Trailbreaker natural gas pipeline and using it to ship an estimated 200,000 barrels per day of bitumen to an East Coast port. The pipeline runs east to Montreal and then heads south through Vermont, New Hampshire and Maine, where environmental opposition is expected to be fierce.
Kinder Morgan Canada has proposed a $5.4 billion expansion of its Trans Mountain pipeline, which runs west from Alberta to Vancouver, British Columbia. The company is seeking to triple the capacity of the pipeline to 890,000 barrels per day (EnergyWire, April 24).
Meanwhile, TransCanada is proposing an alternative route to carry oil sands bitumen to the East Coast. Early this month, the company announced an open season on a project to convert its Mainline natural gas pipeline to carry oil sands bitumen.
The $5 billion Energy East Pipeline could carry 850,000 barrels per day of oil sands from Alberta to Quebec. From there, the company would build an extension to the port city of St. John in New Brunswick (EnergyWire, April 3).