Athabasca River a case study in oil sands development

Governments are failing to balance the needs of the river with the demands of a thirsty industry

September 9, 2013

Simon DyerCALGARY, AB, Sep 9, 2013/ Troy Media/ – If you’re looking for a case study about the environmental management of oil sands development, take a look at how water from the Athabasca River is used in oil sands extraction.

This case study tells the story of how our governments are failing to balance the needs of the river with the demands of a thirsty industry, though no single company or project is to blame.

The narrative is complex, featuring a series of missed policy deadlines, competing statistics, and questionable facts.

But it could also be a good news story, with an economically viable solution waiting in the wings.

Let’s start with the water.

Oil sands extraction uses a lot of water. Producing a single barrel of bitumen from oil sands mining takes 2.4 barrels of freshwater, even after accounting for the amount of water that is recycled. In total, oil sands mines used the equivalent of over 800 million bathtubs of freshwater last year, most of it withdrawn from the Athabasca River. And industry’s water use will be far higher in the future as oil sands mining projects that have already been approved are constructed.

But the Athabasca River is a big river, so does industry’s water use necessarily mean the environment is at risk?

Well, that depends.

On rare occasions in the winter, the amount of water flowing in the Athabasca River can drop dramatically. When water flows drop, habitat availability for fish is reduced and the river contains less oxygen, and this can harm the eggs and fry of fall-spawning species such as Lake Whitefish.

Although the amount of water used to produce each barrel of bitumen from the oil sands has decreased over the years, rates of production and cumulative water withdrawals from the Athabasca River have steadily increased. This means water use must be carefully managed through introducing new rules to protect the river when flows are critically low.

It’s common to hear government or industry representatives say that the oil sands industry withdraws only about one per cent of the average annual flows from the river.

Unfortunately, statistics related to average river flows are not very useful in guiding decisions on water management. The average temperature in Fort McMurray may be above freezing, but that is definitely not useful information for making clothing choices on a cold January night.

And while companies are required to reduce water use during low flow periods, there is currently no period when protection of the river takes precedence over industrial withdrawals and water withdrawals are halted.

An Ecosystem Base Flow establishes a flow target in a river below which no water withdrawals are allowed – effectively protecting the river when it is most vulnerable. Ecosystem Base Flows are increasingly considered both a science and policy best practice.

Rather than requiring companies to halt production during low-flow periods, a balanced approach would be for companies to withdraw and store extra water during periods of higher flow, which they can use instead of making withdrawals directly from the river during low-flow periods.

Anyone who spent time in Fort McMurray this rainy June will appreciate that flow levels in the summer can be phenomenal. Rather than limiting production, therefore, the river’s seasonal variability provides an opportunity for government and industry to plan ahead and manage water use responsibly.

Companies like Total, Imperial, Shell and CNRL have already incorporated many months of water storage into their plans, and they have also incorporated the costs of the engineering solutions for water storage into their project budgets. According to industry data on water storage options, implementing a water management framework that includes an Ecosystem Base Flow for all operators would cost as little as 40 cents per barrel of bitumen produced.

By implementing a low-flow cutoff, Alberta and the oil sands industry would be taking a significant step closer to responsible oil sands development, and could answer their critics by demonstrating where real progress is being made on balancing environmental protection and energy production.

While the government has initiated various efforts to establish water management planning for the Athabasca River, those efforts have failed in several respects. A 2007 joint water management framework announced by the Department of Fisheries and Oceans and Alberta Environment took a first step by establishing a plan to account for water demand and establish rules about reducing water withdrawals, but it did not set an EBF limit at which point withdrawals would be halted to protect the river.

The government also promised to strengthen the management framework for the Athabasca River by January 2011, but so far no changes have been implemented. A committee made up of oil sands companies, environmental organizations, First Nations and Métis agreed in principle about the need for an Ecosystem Base Flow, but could not come to consensus.

A major stumbling block was Suncor and Syncrude’s reluctance to agree to halting water withdrawals during rare periods of extremely low flow. To be both fair and effective, an Ecosystem Base Flow limit on water withdrawals must apply to all companies.

In failing to make progress on setting a low-flow cutoff, both government and industry leave themselves open to criticism that they are not committed to developing the oil sands resource responsibly.

New oil sands mine approvals are being granted on the incorrect assumption that the Athabasca River is being protected. Earlier this year, the long-delayed Imperial Kearl oil sands project finally started operations. The independent regulator’s decision report – which weighed the merits of the project and was released in 2007 – underscored the importance of this issue when it concluded that the Kearl project would not likely result in significant adverse environmental effects, as long as an enforced Ecosystem Base Flow was implemented for the Athabasca River.

In other words, the decision that the Kearl project was in the public interest was contingent on rules being introduced that would halt river withdrawals during low-flow periods. It states:

The Joint Panel finds that the KOS Project is in the public interest for the reasons set out in this report. The Joint Panel concludes that the project is not likely to result in significant adverse environmental effects, provided that the recommendations and mitigation measures proposed by the Joint Panel are implemented.

The review panel’s specific recommendations included that, “Phase II of the Water Management Framework be implemented by January 1, 2011, in keeping with the stated commitments of the Governments of Alberta and Canada,” and that the Department of Fisheries and Oceans and Alberta Environment “incorporate an ecological base flow into the final Water Management Framework for the Athabasca River.”

So, in the circular reasoning that has become common in oil sands decision making, approval of the project was granted based on mitigation that hasn’t actually been implemented yet.

More than six years after regulators made these conclusions, the Athabasca River remains unprotected.

One would think the delays that Imperial experienced would have given the governments of Alberta and Canada extra time to implement the necessary changes to ensure the protection of the Athabasca River ecosystem, especially since the Panel identified such policies as the key to limiting the impact of the project.

While it’s promising to see some companies take voluntary actions to mitigate the impacts of their projects and continue to reduce per-barrel water use, such steps do not replace the need for government to protect the environment by establishing an Ecosystem Base Flow that applies to all companies.

While many in the oil sands industry grumble about the pace of oil sands approvals, spare a thought for the downstream communities and public interest intervenors who consider the pace to be lightning-fast compared to progress on environmental policies. It is common to have to wait years to see promises to protect the environment turn into policies — and by that point, significant damage may have already been done.

Whether it be water withdrawals from the Athabasca River, enforcement of tailings cleanup rules, or the protection of caribou or wetlands — the ongoing failure of governments to meaningfully address impacts and deliver on past commitments undermines the entire industry’s recent efforts to secure the social licence to operate.

While governments of Alberta and Canada talk a lot about responsible oil sands development, the delivery of solutions remains limited. Six years have passed since the Imperial panel recommended that a zero-withdrawal low-flow limit must be implemented to protect the Athabasca River and two years have passed since the government’s own deadline for implementing a new water management framework that protects the river during low flow periods.

A balanced approach would allow industry full access to river water but recognize cumulative effects and the need to protect the river during low flows. Although this approach is feasible, it has not been implemented.

As the world continues to look for evidence of environmental leadership in Canadian oil sands development, a major solution to one of the key issues of concern remains just out of reach.

Simon Dyer (@SimonJDyer) is Policy Director at the Pembina Institute. This column originally appeared in the September issue of Oil sands Review.

This column is FREE to use on your websites or in your publications. However, MUST be credited.

© Troy Media

Become a Troy Media online contributor. Click here.

Subscribe to receive our daily email updates. Click here.