Canada is renowned for its crude oil production. In fact, it is the fourth largest oil producing country in the world. Even so, our country still purchases crude oil from other oil producing powerhouses such as Saudi Arabia. So, why do we feed a market in another country that we already have in our own? Unfortunately, Canada does not have the infrastructure to transport resources across its provinces. Not only does this mean we are supporting a foreign market when we could be supporting our own, but by depending on imported resources, we are taking jobs away from Canadians. The building of pipelines would provide Canada with an abundance of employment opportunities and open the doors to potential investors interested in the industry; it could also provide a means for transportation as some Canadian refineries are not easily accessible to all oil producers. Needless to say, the Canadian oil industry is expectedly frustrated with the country’s hesitation to expand its infrastructure, as it could provide great support to ending the dependence on imported resources.
Take the Saint John refinery, for example, owned by Irving Oil and has zero access to any pipelines, which means it can only be reached by oil through tanker ship or train. The refinery saw close to $1.8 billion worth of Saudi oil alone between January and June of 2018. Although Canada has the product to be entirely self-sufficient, the truth is that Saudi oil is cheaper to purchase and cheaper to transport. Unfortunately, it costs significantly less to ship Saudi oil to Canada’s coast on a tanker than it is to transport Alberta’s oil by land; but, which is more important – cheap oil, or self-sufficiency?
In 2017, Canadian companies spent more than $3.54 billion on importing oil products from Saudi Arabia. In January of 2019 alone, oil coming from Saudi Arabia, made up for almost 10 per cent of Canadian oil consumption, which was previously sitting at eight per cent in 2017. Aside from our neighbouring country, the U.S., Saudi Arabia is the second most significant source for imported oil to Canada. Overall, imported oil from Saudi Arabia into Canada has consistently increased to a total of 66 percent in just five years. Through oil purchases, Canada is indirectly supporting the Saudi regime, a human rights concern for many Canadian activist groups that argue we should be looking to our own resources simply to deter unnecessary support for the Middle Eastern country.
The irony
Annually, Canada is importing more than $40 billion of petroleum products, 62 per cent of which are coming from the U.S. and happen to be transported by land. In recent years, Canada has implemented a number of environmental, social and economic standards that Canadian resources must abide by. However, imported resources are often exempt from these rules. The more that environmental activists spark opposition against Canada’s own oil sands, the more rules are created and enforced, which leads to unsolicited pressure on our own energy industry, but none on the oversized market of imports coming from the 79 different countries we have trade agreements with. In 2018 alone, the port of Vancouver saw over two million tonnes of imported oil.
Rationalizing the cause
Canada’s leader of the Conservative Party, Andrew Scheer, stands strongly behind the idea that if Canada were to completely depend on its own production of fossil fuels, our country would have the opportunity to respond to the world’s demand for energy. Similarly, the leader of Canada’s Green Party, Elizabeth May, feels that if Canada were to stop allowing the importation of resources, we would contribute to the elimination of human rights issues in the various countries we are taking fossil fuels from. Additionally, a move towards dependence on domestic resources could help Canada to find greener solutions for the world of energy. In contrast however, researchers argue that the carbon footprint of domestic and foreign fuel dependence has proven to be relatively the same.
Resources
Information on the above topic was pulled and summarized from the following articles:
https://www.cbc.ca/news/business/saudi-oil-imports-rise-canada-diplomacy-1.5096887
