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Canada’s oil industry — on the verge of a breaking point?

Canada’s oil industry

Creative Commons: 2010

From tumbling oil prices to leaky pipelines, Canada’s oil industry is looking bleaker by the day.

Increasingly concerned with the volatility of the commodity, global investors pulled $200 billion worth of investments from the oil and gas sector this week, of which 30% would have directly contributed to tar sands projects in Alberta.

According to a report prepared by the energy consulting group Wood Mackenzie, analysts expect to see a rollback in tar sands investments all the way through to 2017, arguing that “only those assets with the most robust economics can now expect to make the grade.”

Support for pipelines is also dwindling as oil spills become a more frequent occurrence, such as last week’s Nexen pipeline rupture, which spilled 31 500 barrels of an oil emulsion just a few kilometres from Fort McMurray, leading many to believe that “more stringent regulations” are inevitable.

The accident was just one of many very real examples of incidents that would continue bringing serious damage to communities.

Major cities, First Nation and Métis communities are located directly along pipeline routes like the proposed Energy East project, leaving them vulnerable to devastating oil spills.

Meanwhile with job growth in Canada’s green energy sector recently surpassing employment in the oil sands, the myth that dirty energy serves as the basis of Canada’s economy and quality of life is busted.

According to Statistics Canada, tar sands development contributes just over 2% toward Canada’s gross domestic product, less than 2% of employment, and 15% of net trade flow, just another sign pursuing a dirty energy strategy based on an industry with dwindling credibility is costly and risky .

With Canadian elections looming in the fall and the world more attuned to risks involving fossil fuels, it will now be up to federal candidates on the campaign trail to prove that they are on board with the ongoing transition towards clean energy.

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