What We're Doing: Balancing the Economy and the Environment

A subject that has generated considerable interest is the need to balance the demand for energy with thoughtful, responsible resource development.

Our economy is, fundamentally, driven by supply and demand. Countries around the world are increasingly demanding affordable, secure and reliable energy, and the oil sands are being developed to meet demand.

As demand for energy increases, so does the need to address the impact that an increase in energy development has on our air, land and water.

The oil sands industry recognizes that harder-to-extract oil is needed to fill the supply gap. Responsible resource development is a central, guiding philosophy for the industry.

"It is clear that sustainable development is critical to everyone's future and our success. Tomorrow's projects will be even more difficult, complex and capital-intensive. All will bring environmental and social challenges, with climate change foremost among them. Shell's ability to develop new technologies and to manage these projects in ways that reduce impacts and deliver local benefits in the communities where we work will be vital to winning new business and delivering existing projects."

Jeroen van der Veer, Shell's Chief Executive

 

The oil sands industry is working to address the challenge of balancing the economy and the environment. Some say that it isn't possible to develop the oil sands while adequately protecting the environment. Others believe it is possible as long as everyone – industry, government and people – commits to meeting the challenge.

According to a Corus Radio/Angus Reid poll conducted in October 2008, the majority (71%) of Canadians think it is possible to have a strong oil and gas industry while at the same time protecting the environment. Slightly over half say the Alberta oil sands have been good for Canada overall. 

However, 58% think the oil and gas industry has a bad record when it comes to environmental performance. Canadians want the government to introduce new regulations focused on energy conservation and regulating energy use and prices.

These results are consistent with a poll that was conducted on this website, which also found that Canadians believe balance is possible, but not being achieved today. For full results, click here.

Economic Impacts of the Oil Sands

A new economic study projects that oil sands investment will generate $1.7 trillion in economic activity and at least $306 billion in federal and provincial tax and royalty revenues across Canada over the next 25 years. The report by the Canadian Energy Research Institute projects that more than 456,000 jobs in Canada will be directly or indirectly linked to the construction and operation of oil sands facilities. 

The chart below illustrates the impact the oil sands will have on jobs across the country.

 

Government regulations

Oil sands development is controlled by strict, government-approved environmental standards that are among the most comprehensive in the world. All projects must be approved, and environmental assessments must be completed before every project. The environmental assessment process includes a comprehensive cumulative effects assessment, stakeholder review and input, a regulatory review and public hearings.

Before any project is approved, the operator must agree to significant monitoring and reporting – required by both government and industry – and agree to participate in regional multi–stakeholder forums. Operators are accountable for their commitments, and subject to ongoing inspections and compliance reviews. Once a project is approved, the approval must be renewed every 10 years.

Provincially, three key regulators oversee the environmental performance of oil sands operations:

  1. Alberta Environment
    • Air, land, water, reclamation
  2. Alberta Sustainable Resource Development
    • Surface access, timber harvest, wildlife management
  3. Energy Resource Conservation Board
    • Environmental performance is key to passing the Board's public interest test

Federally, the regulators include:


Steps to development in the oil sands

  1. A private company purchases mineral rights for a specific area.
  2. The company consults with First Nations groups in the area.
  3. The company makes an application for development to the Alberta Energy Resources Conservation Board (ERCB), which regulates safe, responsible and efficient development of Alberta's energy resources.
  4. An environmental impact assessment, water use request and socio–economic impact study are submitted by the developer to the Alberta government.
  5. Public hearings may be held.
  6. A decision on the project application is made in the public's interest by the ERCB.
  7. If approved, development proceeds based on terms set out in the project approval.
  8. Annual reporting and 10–year renewal required.

Source: http://environment.gov.ab.ca/info/library/7925.pdf