June 26, 2010
Canadian coal exports to Asia continue despite carbon-busting bitumen ban
Calgary Sun
Prime Minister Stephen Harper’s pledge to ban bitumen exports to countries with lax environmental standards, especially China, may have trapped the government in a tricky spot.
Canada currently ships no bitumen to Asia. The vast bulk of Alberta’s oilsands product is shipped to the U.S.
Asia, however, is Canada’s primary market for coal exports. Coal is one of the worst offenders in terms of carbon emissions, and the appetite for Canadian coal in China, a country with weak environmental regulations, is growing.
Yet Harper’s government, which wants to turn Canada into a “clean-energy superpower,” isn’t considering restricting coal exports to countries with less stringent environmental standards.
Federal Environment Minister Jim Prentice said “that’s a different issue” because the coal Canada ships to Asia is metallurgical coal used for steelmaking rather than generating electricity or heat.
“There is no alternative, as I understand it, in terms of the steelmaking process, other than high-quality metallurgical coal,” Prentice said in an interview. It’s a different logic that applies to bitumen.
“Our policy is not to prohibit bitumen exports to China. Rather, we’ve said that we don’t want to see carbon leakage, we don’t want to see a loss of Canadian jobs. And we would not want to see our bitumen exported, in its raw form, to any country that has lower environmental standards than Canada,” Prentice said.
“We said very clearly that we don’t want to see people circumvent Canadian environmental requirements by shipping (raw bitumen) to a country that has lower standards.”
B.C. is the source of most of the coal Canada exports, followed by Alberta.
Alberta Energy Minister Ron Liepert said he doesn’t want to see any trade restrictions imposed on its resources.
“Well, I guess that’s probably true,” he said when asked if it wouldn’t make more sense to restrict coal exports to Asia rather than bitumen if the intent is to lower carbon emissions.
“But I do want to make sure that I’m not being misinterpreted: I’m not suggesting that any of it should be banned. We operate in a free-market environment. Those are market decisions.”
Liepert said “the better answer would be to stay out of it altogether,” noting, however, “I think we are a long way from getting into any kind of disagreement” with Ottawa.
NDP energy critic Nathan Cullen said Harper likely regrets his election pledge, made in Calgary in September 2008, to ban bitumen exports to countries with low environmental standards.
The Skeena-Bulkley Valley MP questioned the political logic of saying bitumen exports should be banned to countries with low emissions standards, while allowing coal exports to those same countries.
“If you’re doing one, you should do the other. The fact that the government won’t do that shows the bitumen policy is just a one-off, and probably something they’re hoping to undo,” Cullen said. “I think Harper had said it and then got trapped in the commitment.”
Unlike bitumen exports outside North America, the trade in coal is worth billions of dollars. In 2007, Canada exported 31 million tonnes valued at $2.9 billion. Most of it went to Japan, but China’s appetite is growing as the country’s economy expands.
“It’s increasing dramatically,” Cullen said, whose riding includes the coal-export terminal in Prince Rupert.
