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G. Joel Chury
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G. Joel Chury is a veteran investment columnist for Resource World Magazine and the Editor in Chief of VantageWire.com and author of the Bottom Line Report newsletter. His knowledge of both the mining and oil and gas sectors along with his ability to sift through TSX.V data and press releases... More
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  • Oil Sands Semantics: I Say Potato, You Say Po-TarSands 0 comments
    Feb 14, 2012 1:27 PM

    Political agendas openly on display with the vernacular chosen when describing Alberta's bituminous sands

    SOURCE: VantageWire.com - Based solely on the choice of a descriptor when talking about the retrieval of bitumen from the sands in the Athabasca basin in Alberta, it becomes obvious which side of the issue you take. Technically speaking the official term for this hydrocarbon source is "bituminous sands," but we rarely see this used in any main stream media article. Perhaps it's too cumbersome, or confusing, but it is the most accurate, as bitumen is indeed being extracted during the process. More commonly, the descriptor used falls into two categories: oil sands or tar sands.

    The former is the term more commonly used among industry types, and those who aren't politically charging the debate. It too is accurate, as ultimately, the goal is to pull oil, hydrocarbons, bitumen, energy from the ground, so to call it oil is to call it what it is.

    The latter, is disingenuous and is used to taint the discussion right from the get go. Companies like Alberta Oil Sands (TSX: AOS), Athabasca Oil Sands Corp. (TSX: ATH) and Connacher Oil and Gas (TSX: CLL) are all involved in oil sands operations, and would completely send the wrong image if they were to rename themselves Alberta Tar Sands, Athabasca Tar Sands, and Connacher Tar and Gas; And rightfully so, as they're not in the business of developing tar.

    To call it tar sands is to evoke the image of tar pits like those found in California and elsewhere. These pools of asphalt are not being developed for hydrocarbon extraction, nor will they be, because they do not contain the same levels of oil found in the Athabasca. No, to use the term "tar sands" is to evoke the negative, to smear, to stickify, to dirty, to sully, to essentially tar and feather the debate.

    It's a common tactic used by the green movement, and on many occasions it is quite effective. For those outside of the sector, the nomenclature becomes confusing, and the images are meshed together as one. From a PR standpoint, the outcome is quite detrimental to the oil and gas sector.

    But, even more aggravating is when government uses the t-word. We would hope that our leaders would be educated enough to use terms properly, with the proper pronunciation. This is why after 8 years of the Bush administration, hearing the word "nuke-u-lar" is akin to nails on a chalkboard.

    Today, a Reuters report according to a draft agenda suggests that European Union officials on Feb. 23 are expected to vote on a draft law designed to label fuel produced from 'tar sands' (there's that term again) as "more polluting than that from other forms of oil." Now, we're expected to believe that the EU is infallible, as their handling of the economy, and their own energy supplies have proven quite on the contrary. But instead of taking into consideration the ethics involved, the label is dished out to put the spin on the energy source.

    Now, of course, this is set to engage intense lobbying from Canada, where the argument has been made that the EU is unfairly discriminating against the country. The bill automatically labels most of the supply from the world's third-largest oil reserves as 'tar sands' in an effort to rank and label the most carbon-intensive options of supply.

    Perhaps it's the climate in Europe that's changing these minds. The sentiment has moved on from the "Not in my back yard" attitude when it comes to nuclear energy, post-Fukushima, and for natural gas fracking, after the documentary Gasland hit European theatres, to "Not in your back yard either" with this new labeling scheme.

    I don't agree with Canadian journalist/super pest Ezra Levant a lot, if at all, but I do agree with his argument about the concept of "ethical oil". NATO countries are engaged in countless violent campaigns in areas of the world that provide "cleaner" oil supplies. But yet, we ignore the human costs involved with securing these supplies, and paste the image of human rights and peacekeeping over the actual motives that are sending our troops abroad.

    Instead of embracing the fact that oil supplies from Canada are indeed safer when it comes to human sacrifice, or putting further research and development capital into cleaner oil sands technologies, we fight more difficult political battles in the Western world with ourselves. We argue over semantics, like oil sands vs tar sands. It's ridiculous.

    Complaints are heard about "big oil", yet the attacks very rarely are directed at OPEC. To be quite clear, Canada isn't a part of OPEC, nor will it ever be. It's incredible that this is the way friendlier oil suppliers are treated.

    Going forward, an anonymous source said to Reuters, "It's very unlikely (the EU bill will) get a qualified majority, which means that this will go the Council." At least there are still some European nations who are opposed to this unfair labeling, especially from the Netherlands (home of Royal Dutch Shell), the United Kingdom (home of BP) and France (home of Total).

    The drafted EU proposal would have 'tar sands' oil assigned a default greenhouse gas value of 107 grams of carbon per megajoule, thus informing buyers that it has more climate impact than conventional crude with 87.5 grams. If ratified, the ranking would attempt to reduce the carbon intensity of the EU's transport fuels by 6% by 2020 as part of wider goals to cut carbon emissions by 20% by 2020.

    Perhaps a compromise could be made, if lobbyists from Canada have any say in the matter. First, change the name from tar sands to oil sands, but keep greenhouse gas value for those who care about that sort of thing. Next, put an ethical value on the supplies, for instance informing buyers that Zero soldiers had to die for each megajoule of oil sands megajoule, whereas 12 soldiers and 4 civilians had to die for each megajoule of oil from unstable countries. Something like that would be a little more honest, don't you think?

    G. Joel Chury

    Editor in Chief

    VantageWire.com

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