- Developing Alberta's Oil Sands: From Karl Clark to Kyoto
Developing Alberta's Oil Sands is a well-researched, well-written, tightly argued book. In Part One (to 1945) the author reveals the early history of the sands and the complicated manoeuvres carried out by the federal and provincial governments over its development. Until 1930, Chastko points out, the federal government controlled research on the tar sands and retained ownership of the resources of Western Canada, and this led to countless disputes over who could or could not carry out experimentation on, and then refine them. Acrimony between the two levels of government marked these years, but there was a bright spot – Karl Clark at the University of Alberta and the Scientific and Industrial Research Council. As a result, in large part of Clark's work on the hot-water extraction process, both levels of government saw the sands as a practical source of energy as the Second World War approached. Absand, a private concern operating with the permission of Ottawa, ran a problem-plagued operation during the war, but did show that oil could be abstracted from the sands. The plant's future was anything but secure as long as Ottawa ignored Alberta's expertise and brought in outsiders, who insisted on separation techniques that were certain to fail. In the end (1945), Ottawa washed its hands of the oil sands project.
The provincial government continued to invest in the oil sands for two reasons: It believed the project was feasible and there was no alternative. As the author points out, until the early 1970s, the sands were left to Edmonton to experiment with and to exploit. The problems were many, and although the oil strikes at Leduc and elsewhere drew attention away [End Page 162] from synthetic fuels, Edmonton continued with the project. Chastko leads his readers through the labyrinth from the late forties until the early seventies, backlighting the passage of events in Alberta with the image of the United States and its position in the international energy market. One important question dominated the discussion: Could a barrel of oil sands oil compete with a barrel of conventional oil? If it could not, the oil sands project made no sense. When commercial development of the sands began in 1960, it sprang from the union of American interest, American capital, and access to American markets; the Americans believed that at some future date synthetic oil would be able to compete.
The Social Credit government of E.C. Manning had walked a narrow path between developing the sands for the future and ensuring that conventional oil would not be displaced by it. Manning, looking ahead, encouraged the Syncrude group (1968) to submit a plan to exploit the sands. The 1973 OPEC oil embargo demonstrated the wisdom of his decision and added urgency to the development of the sands as a viable energy source. Peter Lougheed's Conservative Party took power in 1971 and, as the author points out, immediately indicated that his government would not be handling the conventional oil companies with kid gloves. Moreover, Lougheed was prepared to tackle Prime Minister Pierre Trudeau over energy questions. Chastko effectively analyses the Ottawa-Alberta shoving match, the creation of Petro Canada, and the National Energy Policy. The NEP tinkered with the price of oil as well as the conditions under which it could be sold and introduced new taxes to skim off billions of energy dollars and direct them from the province to Ottawa. Ottawa also took away the structure capable of establishing the true value of synthetic crude and invented its own, causing investors to back away from synthetic fuel projects. Oil sands development could not afford to turn back or go forward. In Chastko's words, 'In effect, the NEP gutted the oil patch and severely jeopardized the country's energy future.' Furthermore, he claims, it set the development of the oil sands back by five years.
The eighties and nineties, says the author, marked a new beginning for the oil...