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Alberta's thirst for oil leaves a dry taste
Energy industry hogs water: report

PATRICK BRETHOUR

CALGARY -- The oil sands' thirst for water is far outstripping Alberta's projections, threatening to drain the Athabasca River as the pace of project development accelerates, a prominent environmental group says in a report issued yesterday.

And Alberta Environment Minister Guy Boutilier said the province will start charging for water use, if necessary, to curb consumption in an increasingly parched province.

Environmental groups have long warned of the peril posed by using water to separate bitumen from the oily sands of northern Alberta, but the figures released yesterday by the Pembina Institute for Appropriate Development indicate that the threat is more imminent than previously believed.

In situ projects, which use steam to melt bitumen before it is pumped to the surface, used almost three times as much water in 2004 as originally projected. That part of the industry used 27 million cubic metres in 2004, the equivalent of about 72,000 Olympic-sized swimming pools.

Projections from 2001 had shown the industry reaching that level of water use in 2015, with the level in 2020 not much higher. Now, with massive development projected for the oil sands -- particularly in the relatively water-intensive in situ category -- that total is likely to grow substantially over the next decade, intensifying worries that the flow of the Athabasca River will be compromised.

"I fear we're going to run out of water before we run out of bitumen in northern Alberta," said Mary Griffiths, senior policy analyst at the Pembina Institute.

The environmental group renewed its call for a moratorium on approving any new oil sands projects, and said the industry should start paying for the water it uses.

For the moment, Alberta is leaving the door open for such charges, as it looks at how to curtail its water use sharply in the coming decade. The province has set a preliminary target of a 30-per-cent reduction over the next nine years from the amount of water used provincewide in 2005. As part of that strategy, it is contemplating a series of "economic instruments" -- including direct fees for users.

Mr. Boutilier said he hopes to decide by the end of March what, if any, fees will be put in place. And he stressed that no one should expect a do-nothing strategy, given the province's long history of concern over water. "Whisky is for drinking, but water is for fighting over," he said, borrowing a quip from author Mark Twain often used in the century-old water debate in Alberta.

The oil industry, while acknowledging that the concern over water use is growing, says its consumption should not be singled out. Other industries, including agriculture, use significant volumes, as do the growing cities of Alberta. "Yes, we are users of water, but the province is seeing a tremendous economic return from that use," said Pierre Alvarez, president of the Canadian Association of Petroleum Producers. Mr. Alvarez said his industry does not support a moratorium, nor does it back the idea of fees being levied for water use. But reducing water use is part of a "big push" by the oil sands sector as it invests in new, more efficient technologies, he added.

Much of the quest for efficient technology is spurred by the increasing cost of natural gas, which is typically burned to create steam to free bitumen. However, some of the emerging technologies that could displace natural gas would have the environmentally friendly side-effect of reducing water usage.

Ms. Griffiths of the Pembina Institute said she is concerned not only about the volume, but also the type, of water being used by in situ projects. The projections from Alberta Environment contemplated an even split between fresh water (which includes flows drawn from the Athabasca) and naturally occurring saline water, which is too mineral-laden for drinking, irrigation or other non-industrial purposes. In 2004, however, (the most recent year for which statistics are available), more than 60 per cent of consumption was of fresh water.