Is Canada Turning Into The United States?

Jokes about the similarity of the two countries have gone on for decades, but some recent moves by the Conservative government of Prime Minister Stephen Harper do beg the question: is Canada turning into the United States?

Environmental and civil rights groups in Canada are up in arms over new proposals from Harper to reform the regulations that manage Canada's natural resources.  The Harper government says that the reforms are meant to reduce redundancy and streamline the approval process for projects in Canada's energy sector, which will benefit all Canadians through lower energy prices and increased exports; environmentalists say the changes are just meant to remove environmental protections, particularly those blocking the expansion of Oil Sands operations in Alberta.  Harper's plan will have the largest impact on a proposed pipeline that will run west from the Oil Sands region through British Columbia to the Pacific Ocean, where tankers can be loaded with the heavy Oil Sands bitumen for shipment to China.  Currently, the pipeline route would have to be evaluated for its environmental impact on each watershed it will cross, and there are many of them in British Columbia; the Harper proposal would mandate that environmental approval would only need to be sought where the pipeline crossed an “official” watershed, a far smaller number.

Harper is presenting this as a net good for Canada: increased exports that will boost the Canadian economy, more jobs and more domestic energy security; opponents say that it is a massive handout to Big Oil and that environmentally sensitive, though not federally-protected, lands will be destroyed by the pipeline.  The Harper government is also putting Canadian environmental groups under closer scrutiny.  Officially, the closer look is meant to uncover donations from foreign sources, which in many cases would be a violation of Canadian law; but again, opponents say that the official story is merely a smokescreen and that the investigations are simply an attempt to silence groups opposed to Harper's policies. 

These investigations come on the heels of a new law passed in Quebec that gives authorities the power to block public demonstrations.  The law follows weeks of street protests by college-aged youth in Quebec protesting hikes in the tuition at provincial universities.  Again, the government and civil libertarians take differing views of the new law: authorities in Quebec say that the law will only be employed in extreme circumstances, noting that the tuition protests have dragged on for weeks, with the protestors refusing to compromise on a proposed deal regarding tuition and that the continuing protests are having a negative impact on the economy in a number of Quebec's cities; civil rights groups though see the new law as nothing more than an attempt to limit the public's right to free speech and assembly and to eliminate dissent.

Meanwhile, Canada is also flexing its military muscles.  Canada is sending 1,400 military personnel, along with five ships and a submarine, to participate in the biannual “Rim of The Pacific” military exercise; all at a time, Toronto's Globe and Mail notes, when the Canada's Defense Department is cutting back on its overall budget.  Canada is also in negotiations for a place in southeastern Asia to host a military “hub” as they're calling it.  The hub would be a way for Canada to have a military presence in a region that is rapidly growing in economic and strategic importance; a likely candidate is reported to be a small port facility next to an airfield in Singapore. Canada's Defense Minister Peter MacKay said that the hub would signal “Canada's intention to reassert our credentials in the Pacific.”

MacKay's announcement followed on the heels of a statement by his opposite number in America, Leon Panetta that the United States was planning to base 60% of its naval forces in the Pacific by 2020. But when you pair Canada's desire for their own slice of the military pie in southeast Asia with Harper's pro-business, and according to critics anti-environmental, energy policy, and new laws that are having a chilling effect on public protests that employ some of the same strategies as the PATRIOT Act, you're seeing policies coming out of the Canadian government that are looking very American.

Kenya Joins The Big Oil Club

It looks like we can add Kenya to the list of the world's petro-states.

Kenya's President Mwai Kibaki made the announcement live Monday on Kenyan TV that a prospect well had struck a reservoir of crude oil in the northwestern part of the country.  The test well was drilled by Tullow Oil Plc, a Britsih company that specializes in oil prospecting and production in Africa.  Previously, Tullow discovered oil in neighboring Uganda, kickstarting the oil industry in that country.

It is still too early to determine the true value of the Kenyan oil reserve, more test wells will first need to be drilled.  But the early indications are positive – the oil drawn from the reserve appears to be of good quality, while Tullow said that the strike went “beyond their expectations”.  Kenyan officials, meanwhile, seemed to be incredibly optimistic during the press conference.  President Kibaki talked about Kenya becoming an oil exporter in three years, while Kenya's Energy Minister Kiraitu Murungi promised that: “we will make sure that the oil in Kenya is a blessing for the people of Kenya and not a curse.”

Murungi was referring there to the “resource curse” - the paradox that often strikes developing countries when a natural resource is discovered: rather than sparking the development of the nation as a whole, the resource often leads to the concentration of wealth in the hands of a few, widespread corruption, and rampant poverty for the masses.  We talked about the resource curse here recently when oil was discovered in the Puntland region of Somalia.

Kenya should be well-positioned to avoid the resource curse though.  The country has reached a fair level of development already and has a democratic government, albeit a somewhat flawed one, two factors that should help to ensure that any future oil revenues are distributed properly among Kenya's citizens.  A few weeks ago Kenya announced the construction of a multi-billion port facility outside the coastal city of Lamu, that will include an oil import/export terminal.  Originally this facility was meant to be at the end of a pipeline running from South Sudan, allowing the South Sudanese to export their oil without sending it north to export facilities in Sudan, since relations between the two nations are generally terrible.  But the facility at Lamu could also be used to export any Kenyan crude to eagerly-awaiting markets in Asia as well.

Iran, The War, and Everything

Since it is now the Persian New Year (Happy Nowruz), it seemed like a good time to run the infographic below that illustrates how foreign powers nibbled away at the territory of Iran during the 19^th and 20^th centuries, which might just explain why the Iranians are rather particular about being ordered around by the international community.

 Meanwhile, Russia's Foreign Minister Sergei Lavrov has come to the same conclusion that I did several months ago – that any attack on Iran's nuclear sites will only drive Iran towards building a nuclear bomb, rather than dissuading them from it.  “I am almost certain that such a decision will surely be taken after (any) strikes on Iran,”  Lavrov said Tuesday on Moscow's Kommersant FM radio, where he also claimed that the CIA and other American officials have admitted to not having any hard evidence of any political decisions on the part of Iran's leadership to actually authorize a nuclear weapons program.  Lavrov also repeated assessments made by military analysts in the West that have concluded airstrikes against Iranian facilities could slow any research program, but would not destroy it as the Israelis did with Iraq's nuclear program, which was effectively ended by an Israeli airstrike in 1981.

But energy industry analysts are becoming more convinced that a conflict with Iran is in fact imminent, based in part on an executive order signed on Friday by President Obama that, among other things, orders executive departments and agencies responsible for plans and programs relating to national defense to “be prepared, in the event of a potential threat to the security of the United States, to take actions necessary to ensure the availability of adequate resources and production capability, including services and critical technology for national defense requirements.”  Get that? Analysts say that the order effectively would, in a time of national emergency, give the President effective control over the country's natural resources.  And the only national emergency the analysts see on the horizon is a potential conflict with Iran.  The White House tried to downplay the impact of the executive order on Monday, saying that it was similar to executive orders signed by several other presidents in the past and should not be taken as a sign of an impending war.

The New York Times meanwhile, is reporting that the Iranian conflict could prove to be quite costly for America.  A leaked war game scenario carried out by the Pentagon earlier in the month projected up to 200 American casualties after a US warship was attacked by Iranian forces in retaliation for Israeli airstrikes against their nuclear research facilities.  This attack then draws the United States into a large-scale conflict with Iran.  Pentagon officials stressed that this was one of a number of possible outcomes, but admitted that an Israeli attack would spark off a series of reactions that were both “unpredictable and uncontrollable”.

My prediction is that if the Israelis launch their oft-threatened airstrike, it will be before our November presidential elections.  The clock keeps ticking...

Somalia's Latest Problem: The Resource Curse

It is looking like Somalia may have another problem to soon deal with: the resource curse.

The first oil from a new well drilled in northern Somalia could flow to the surface just weeks from now.  As is typically the case when a new national resource is discovered in an under-developed nation, the new oil patch is being described as the cure for Somalia's ills – a domestic source of income that will promote stability and development for the nation that will bring the Somalia diaspora home.  The reality is much more problematic.

While Somalia's Transitional Federal Government (TFG) has signed deals for oil exploration, the oil field is actually located in the northern part of the country in Puntland, a semi-autonomous region of Somalia that has little to do with the TFG.  To further complicate matters, the TFG's mandate runs out in August (it is suppose to be a “transitional” government after all), so what will happen to their authority to enter into contracts such as this is a question.  And the presence of foreigners looking for wealth in their land has drawn the attention of Somalia's Islamist militants.  A little-known Islamist militia, which according to The Guardian is led by the ridiculously named Shiekh Atom, has pledged loyalty to Somalia's top terror group, al-Shabaab and has declared all oil contracts signed in Puntland to be null and void.

Some Somalis are also skeptical about the potential for oil to save their country.  It is a promise that seldom works out as well as promised, especially in Africa.  One only has to look at oil-producing countries like Equatorial Guinea and Nigeria, where the quality of life for the population in the oil-producing regions has actually gotten worse since the discovery of oil, for evidence of this trend.  A number of Somalis cited in articles about Puntland's oil are skeptical of the alleged windfall coming to their nation and worry that most of the wealth will wind up in the hands of foreign companies.

There also seems to be a little confusion over what's actually being drilled in Puntland in the first place.  When a potential new oil or gas reserve is discovered, it is practice to first drill a test well to analyze the quality and commercial viability of the field.  Yet in a conference on Somalia last week, British Prime Minister David Cameron said that not only was the first oil expected to flow from the Puntland well in the coming weeks, but that pipelines had also already been laid to the coast so that the oil could be exported – construction of a pipeline typically doesn't occur until you know you have a viable field on your hands, otherwise it is a lost investment.

The oil news out of Puntland also puts this story from December 2010 in greater context.  The government of Puntland had announced the signing of a deal with a shadowy private security firm; the deal was allegedly to fight pirates along the Somali coast, yet security efforts were focused inland.  The suggestion at the time was that firm's real purpose was to protect foreign workers who were prospecting for natural gas reserves in Puntland's interior.  

Kenya's Big Port Gamble

Amid much fanfare and in the presence of international dignitaries, Kenya broke ground today on a major port complex that, if successful, could propel the country into the ranks of “developed” nations and serve as a catalyst for regional stability.  Or it could also turn into a multi-billion dollar boondoggle for the East African nation....

The port complex near the town of Lamu on the Indian Ocean coastline in southern Kenya will be the country's largest-ever infrastructure project, with initial construction costs budgeted at a whopping $24.5 billion.  It will include berths for 32 ocean-going ships along with an oil export facility.  But the port will not just be for Kenya's benefit – a new railway, super-highway and oil pipeline will link Lamu to Ethiopia and South Sudan as well.

This last link is especially important.  When South Sudan left Sudan last summer, they took with them the bulk of Sudan's oil reserves.  The South Sudanese economy is almost totally reliant on oil sales for revenue, but all of the existing infrastructure links South Sudan's oil fields with refineries and export terminals in Sudan.  When South Sudan embargoed shipments of oil north to Sudan over a payment dispute earlier this year, there was some fear that the dispute could reignite fighting between the two sides – South Sudan previously fought a decades-long war for independence against the Khartoum-based government in the north.

For South Sudan Lamu represents nothing short of an economic lifeline, a way to export their only commodity while avoiding the bottleneck in Sudan.  South Sudan's President Salva Kiir was on hand for the official groundbreaking along with his counterpart, Ethiopian Prime Minister Meles Zenawi – Ethiopia lost their own Red Sea coastline following the independence of the region of Eritrea in 1993.  For their part, Kenya is banking on Lamu to help to move them towards their goal of being considered a developed nation by 2030.

There are, however, some problems with the Lamu project.  It is a huge expense for Kenya to undertake right now, despite the potential it provides for future economic growth; those projections though are speculative, Kenya is assuming that Lamu will become a transportation hub in the decades to come, something that is far from a sure bet.  Pristine mangrove forests and coral reefs are being destroyed so that the port facilities can be constructed, leaving environmentalists to worry about the long-term impacts the project will have on the local ecosystem.  And according to the BBC World Service, the indigenous Lamu people opposed the project as an unnecessary seizure of their historic lands.  The Lamu have also said that they have not been adequately compensated for their losses because land in their society was traditionally handed down through extended families by custom and without official land deeds, meaning official ownership of much of the land was difficult, if not impossible, to prove.

But the Lamu port project is moving forward, whether it becomes the catalyst for regional development and stability that leaders promised at the groundbreaking remains to be seen.

US Politics: Zambian Soccer and Gingrich's Gas Fantasies

I realized that I've been terribly remiss in shamelessly promoting my recent writing on other websites.

You've probably heard Newt Gingrich's claim that if elected president, he'll give everyone $2.00/gal gasoline.  I take on Newt's latest political flight of fancy over at PolicyMic and explain why market dynamics show that Newt's moonbase idea is more likely to happen than his $2.00/gal gasoline promise.

Meanwhile, over at The Mantle we take a look at the unlikely pairing of Zambian soccer and US politics.  Zambia's national team recently won Africa's Cup of Nations continent-wide tournament.  In their piece about the victory, CBS threw in some tidbits about Zambia's government.  Zambia is engaging in a series of social/economic reforms, reforms that are so sensible they don't have a chance of occurring in the United States.  See why over at The Mantle.

Canada vs. The Greens

Canada's Conservative government isn't making many friends among the environmentalists these days.  As a major United Nations conference on climate change opens in Durban, South Africa, there are persistent rumors that Canada is planning to withdraw from the Kyoto Protocols – the international agreement regulating the emissions of the greenhouse gases (GHGs) blamed for climate change.  While the Canadian government already announced last year that it wouldn't abide by its GHG commitments, “unsigning” the agreement would be a blow to the future of the Kyoto Protocols and would be a pretty heavy blow to the talks just underway in Durban.

Kyoto is scheduled to expire at the end of 2012.  Talks on a follow-up agreement to Kyoto have dragged on, in part because of a fundamental split between developed and developing nations.  Canada  has taken the position that any future agreement needs to include caps on emissions by countries like China and India.  For their part, China and India (and other countries) have replied that they are still “developing” nations and that hard caps on GHG emissions could stifle their economic growth, and add that since the developed nations are responsible for much of the existing levels of GHGs in the atmosphere, it isn't fair to hold the developing countries to the same standard (it is something of a dubious argument, but it is one they are sticking to).

Canada has yet to officially confirm that they are indeed dropping out of the Protocols, though that hasn't stopped critiques from the environmental lobby from rolling in against the Conservatives.  Canada has seen a jump in their GHG emissions since 2009, largely because of development of the Oil Sands reserves in northern Alberta, a project the Canadian government credits for much of the country's current economic health.  But the Oil Sands are also a prime target of environmental lobbying both in the United States and Canada since not only do the Oil Sands contribute to GHG emissions and disrupt the environment in northern Alberta, but they also represent a new and vast source of crude oil at a time that environmentalists are pushing for a “green” energy economy. The most recent fight over the Oil Sands has been the Keystone XL pipeline that would link the Oil Sands with refineries along the Gulf Coast of the United States. 

Speaking of the Oil Sands, Canada has possibly gained an ally in an ongoing fight with the European Union over the Oil Sands.  The EU has been openly discussing barring the import of any petroleum products from the Oil Sands on the grounds that it is a “dirty” source of oil and that the GHG emissions from Oil Sands extraction and production is unacceptably high.  The Canadian government has been aggressively pushing back, arguing both that the Oil Sands do not emit as many GHGs as critics claim and that it is unfair to single out the Oil Sands from other so-called sources of heavy crude oil, like imports from Venezuela, among other nations, since all heavy crude requires extensive processing to turn it into gasoline and other petroleum products.  According to a report, the United Kingdom though is “secretly” siding with Canada.  Liberal Democrat minister Norman Baker was quoted as basically agreeing with the Canadians, saying:  “We believe that means tackling all highly polluting crudes equally, not simply oil sands from one particular country. These certainly represent a problem, but so do other crudes, and it makes no environmental sense to ignore these.”  Canada currently doesn't send any Oil Sands products to Europe, but it does not want to lose Europe as a potential market and the government fears that an EU ruling could set a precedent that would make Oil Sands products more difficult to sell on the open market.  And while I can't imagine China for one caring much about the GHG footprint of the Oil Sands, they could demand steep discounts for Oil Sands products if they know Canada doesn't have many other viable markets.

Africa's New “King Cobra”

Ok, I have to admit that I didn't pay a lot of attention to the recent elections in Zambia, I'm guessing neither did you. I saw that presidential elections were held and that there were protests when the vote counting was taking a suspiciously long time; I was surprised then to read that the challenger won, since long vote counts usually mean that it's just taking the ruling side more time than expected to fill out thousands of bogus ballots. After that, I just filed the Zambia story away and moved on.

That was too bad, since, thanks to this story from The Australian, it turns out the situation in Zambia is far more interesting than a few headlines would make you believe. The elections were indeed won by the challenger, the populist candidate, 74-year old Catholic Michael Sata, who is also known as the “King Cobra” for his sharp tongue, The Australian explains (and just to make the situation a little more interesting, Sata ran on a ticket with Guy Scott, a white Zambian, as his running mate). The main issue in the election turned out to be China.

Zambia is rich in minerals, minerals that China covets to keep their industrial machine rolling. China has had a relationship with Zambia that dates back to the 1970s, but Chinese efforts in the country have exploded in recent years as China's economy continues to grow – more growth means more and more need for the minerals that Zambia has in abundance. This need, combined with some heavy-handed Chinese business practices, has led to a growing wave of anti-China sentiment in Zambia, a sentiment that Sata was able to tap into to draw a line between himself and now-former President Rupiah Banda who is staunchly pro-Chinese. Sata used terms like “infesters” and “bogus” in describing Chinese businessmen in Zambia and played up on ill feelings left by the Banda regime's failure to prosecute Chinese managers who shot Zambian coal miners during a strike.

The situation in Zambia is a big example of a growing unease in Africa about just how deeply China is penetrating into the continent. While many African regimes have welcomed Chinese investment – especially regimes under international pressure like Sudan and Zimbabwe, since Chinese investment typically comes with no strings attached – there are also fears that the Chinese are acting like a new wave of colonists. Chinese projects typically extract raw materials – gold, coal, oil, etc. - either using African unskilled labor under Chinese management, or sometimes with imported Chinese labor. The result is a system that builds little value for the African nations beyond fees paid for the minerals themselves, which reminds some Africans too much of the old colonial days.

For his part, Sata seems unafraid of the mighty Chinese; unlike, perhaps, the South Africans, who canceled a scheduled visit by the Dalai Lama thanks to Chinese pressure. In addition to his sharp words directed at Chinese business interests, he also recently referred to Taiwan as a “country”, a reference that greatly upset Beijing. It will be interesting to see if other African leaders start to follow Sata's lead and look at China a little more skeptically.

Parochial Pipeline Protest

Even though its most famous resident is currently not at home, dozens of people are camped outside the White House, many with the express purpose of getting arrested, all to protest the construction of the proposed Keystone XL oil pipeline. The US State Department is expected to issue their official recommendation on the Keystone XL pipeline, which, if approved, would bring up to 700,000 barrels of oil from the Tar Sands region in northern Alberta, Canada, to waiting refineries along the US Gulf Coast, every day. The White House protests are being organized by an umbrella group called Tar Sands Action, which claims to have 1,500 people signed up to get arrested outside of the White House. The group also has the support of a number of celebrities, while some well-known politicians, including California Representative Henry Waxman, have also voiced their opposition to Keystone XL to both the White House and State Department.

Environmentalists on both sides of the border are up in arms over Keystone XL, since they say it will lead to a massive expansion of operations in Alberta's Tar Sands region. While the Tar (or Oil) Sands contain vast amounts of bitumen, getting it out of the ground and transformed into usable petroleum products is a labor-intensive, and polluting, process. Traditionally, oil sands deposits near the surface were strip mined and the bitumen was “cooked” out of the dirt; today producers more often are employing a method called Steam-Assisted Gravity Drainage (or SAGD), which injects high-pressure steam deep below the surface to liquify the bitumen so that it can be recovered like a traditional crude oil deposit. While SAGD has far less impact on the surface of the Alberta prairies, it uses vast amounts of water, much of which returns to the surface contaminated and in need of treatment. The bitumen pumped to the surface also either needs to be mixed with other petroleum products to make it liquid enough to ship through pipelines or processed by “upgrader” units on-site to turn it into synthetic crude oil (SCO), which looks and acts like traditional crude. The whole process has turned swaths of the rural prairie into industrial sites, with some of the indiginous First Nations tribes in the region reporting spikes in cancer rates and other illnesses, which they blame on the Tar Sands industry.

Opponents of Keystone XL and the Tar Sands in general have a point - operations in the Tar Sands reserves have an obvious impact on the environment – though some claims made by their opponents, such as calling the Tar Sands the largest source of greenhouse gas emissions on the planet, are wildly overstated (the Tar Sands produce a fraction of the GHG emissions of the US coal industry). But exploitation of the Tar Sands has been a boon to Alberta's economy and has helped not only to position Canada as a major energy exporter, but also to bring the Canadian dollar to parity with the currency of their southern neighbors. And that's where the parochialism kicks in. Implicit within the American protests against Keystone XL is the idea that if TransCanada is not allowed to build a new pipeline to reach refineries in the American south then the brakes will be put on expansion of Tar Sands operations. This is ridiculous. With global demand for oil growing and traditional super-large fields in places like Saudi Arabia and Kuwait maturing, more attention is falling on non-conventional deposits like the Tar Sands. So as long as oil prices remain above the $50-60 range (roughly the breakeven point for Tar Sands production) the folks in Alberta will keep the Tar Sands reserves in production. The only question will be where that oil goes. Proposals already exist to build or expand pipelines westward from Alberta to Canada's Pacific coast where Tar Sands bitumen or SCO can then be loaded on tankers headed anywhere, but most likely to China. In fact some in Canada are arguing that even if Keystone XL is approved by the State Dept. that a Pacific Coast outlet is a wise business move so that Alberta will not be subject to the whims of the American market.

So in short, protests by groups like Tar Sands Action aren't going to actually stop oil production in the Tar Sands, but they may succeed in preventing America from getting access to a needed source of crude oil from a close and stable ally.

Green Energy Perspectives

I recently spent a few days up in the Lake Ontario/1,000 Islands Region of New York State (and if you ever have the opportunity to visit this beautiful area, you really should), while I was up there for a vacation, I managed to have several very interesting talks with local residents about energy issues, specifically green/renewable energy projects in the area.

The one topic that seemed to come up in every conversation was wind power. Several major projects are being proposed for the area. On one hand, installation of the wind turbines is being touted as a job-producer for a region that has seen its manufacturing base ebb away. But most of the people I spoke to were opposed to the turbines. Some of the opposition were the expected complaints that wind turbines are big and ugly and that scattering them about the area would have a significant aesthetic impact on a region that now relies heavily on tourism as an economic driver; one man, and avid bird-watcher, also worried about how the turbines would affect the local and migrating bird populations. But a lot of the critique went beyond simple NIMBY-ism; another common complaint raised was the fact that wind turbines just aren't terribly efficient: while wind turbines obviously can't produce electricity when the wind is not blowing, they also can't produce it if the wind is blowing too strongly – in this situation, the turbine will go into a “safe” mode to avoid rotating too fast and literally tearing itself apart; as a result, a wind turbine will typically only generate 35-40% of its rated electrical output, not a terribly efficient form of generation. I had one discussion about other wind generation technologies that are not being as actively pursued as turbine development, such as using kites to generate power, which has shown promise in experiments.

In fact, rather than just saying no to wind, the people from the region that I spoke with had a number of suggestions for other methods of generating power. Hydroelectric was obviously one alternative discussed. Rather than constructing dams, run-of-river plants are one alternative, another discussed were subsurface turbines. At its outlet from Lake Ontario, I was told, the St. Lawrence River has a current flow of about four knots, and unlike wind in the area, this flow is constant. Turbines placed along the river's shipping channel, which is more than 100-200 feet deep, could provide a constant source of power, while going unnoticed by tourists to the region. A demonstration turbine project along New York City's East River, utilizing the river's (which is actually an estuary) daily tidal flow has show promising results. A local politician also told me of her suggestion that biofuel crops be grown in the region. Biofuels typically have been problematic – while they are a truly renewable fuel source since more fuel can be grown each year, in practice biofuels have taken arable land out of food production and anecdotal evidence indicates that biofuels have caused a rise in food commodity prices. But the 1,000 Islands region has numerous farms that have been abandoned; the land has already shown it is arable, so if these abandoned farms were reclaimed for biofuel production, they could grow biofuel crops without negatively impacting the region's food supply.

Finally, there's nuclear. The region is already home to the Nine Mile Point Nuclear Generating Station, the cooling towers of the plant can be seen looming above the shore of Lake Ontario. Grudgingly, most of the people I talked to said that expansion of nuclear power may be the best alternative; nuclear clearly provides the best EROI (energy return on investment) of all the options presented. The plant has operated in the region for years without incident. And despite the the recent events in Fukushima, Japan looming over the nuclear industry, everyone I spoke to said that the chances of a tsunami in Lake Ontario were pretty remote. There remained a certain wariness about nuclear power, but also a realization that, when properly designed and maintained, nuclear power plants can operate safely and efficiently.

There were a couple of takeaways from the energy discussions I had during my trip. The first is, as a friend put it, that there is no “silver bullet” in the energy picture, no one single solution to meeting our growing demands for power, so advocates of wind, nuclear, or even an old standby like drilling more oil wells, cannot present their pet project as THE solution. Second, the average citizen knows far more about sources of energy and has a much clearer view of the energy picture in this country than they are generally given credit for having by the so-called experts, and they also can have some pretty innovative suggestions for meeting our energy needs.

Putin's Got Gas (Problems)

If Barack Obama were thinking of heeding the call of Donald Trump (and others) to order gas prices down, he needs to look no further than Russia, where Russian Prime Minister Vladimir Putin has become a one-man gas crisis, to see what a colossally-bad idea that is. Russia has been facing widespread gasoline shortages, with two dozen regions reporting serious shortages and some places in Siberia running dry for awhile, all apparently thanks to Putin's efforts to wrest control of the nation's gasoline prices away from the open market.

Russia's problems started a few months ago when Putin signed a decree raising the taxes on gasoline in Russia. Of course Russians didn't like the increase at the pump and with presidential elections less than a year away, Putin felt a need to polish his populist credentials. Putin being Putin though, his solution was in February to simply order Russia's gas companies to lower their prices to make up for the rise caused by the new taxes. But the gas companies soon realized that they were getting the short end of the deal and that they could make far more profit by exporting gas to Europe rather than selling it at a loss or near loss at home, so they began to divert shipments from Russian gasoline stations to wholesalers in Europe. Soon stations across the country were experiencing shortages, with some in the Altai Region of Siberia where half of the gas stations ran completely dry.

This caused even more anger among Russia's driving public, so last week Putin stepped in again, this time “suggesting” that Russian oil companies halt gasoline exports for the month of May to put more product into the distribution system at home, state-run firms Rosneft and Gazprom, the giants of the Russian petroleum sector, soon complied, easing the shortages.

But one has to wonder if this is just kicking the can down the road a bit, since once June rolls around and the May moratorium ends, companies will still see the same profit in selling gas abroad (though Putin also ordered a raise in gasoline export taxes to cut into these profits). The reality is that gasoline prices are a function of market forces largely beyond government control. It is a good lesson for Putin, Trump and anyone else who thinks they can just “order” fuel prices around to learn.

Why No Love For Canada?

They had national elections in Canada this week, but unless you're a Canadian this news likely comes as something of a surprise to you. The elections received barely any coverage in the United States, which is disappointing since they turned out to be something of a game-changer for our neighbors to the north: The Conservatives, led by Prime Minister Stephen Harper, won a solid majority in Parliament; the perennially third-place New Democratic Party (NDP) became the official opposition party after the near collapse of the once powerful Liberals; meanwhile the separatist-minded Bloc Quebecois (which advocates independence for Quebec) lost almost all of their seats, while the Green Party elected a member of Parliament for the first time ever.

All in all, it was a pretty momentous election, which makes the lack of any meaningful coverage in the United States all the more confusing. The United States and Canada share the world's longest demilitarized border, and Canada is the United States' top supplier of imported oil - you would think that we in the US of A would then at least care a little bit about what's going on up there. But the United States has long had a parochial attitude towards Canada, as if their main responsibility was to dance to our tune, or as Homer Simpson once quipped when Bart suggested they go to Toronto: “why should I leave America to go to America Jr.?” From the other side of the border, the Canadians have also had fun with the idea of living in America's perpetual shadow, the comedy show Kids in the Hall once did a skit where a character described Canadians to an unknowing foreign foil as “an American without the gun.”

Unfortunately this comical attitude has a way of affecting serious issues, like our political discourse. Take for example recent moves by some members of Congress to block the construction of the Keystone XL oil pipeline. As proposed, the pipeline would carry synthetic crude oil from the Oil Sands region of Alberta to refineries along the US Gulf Coast. But the crude production from the Oil Sands region has a reputation for being hard on the environment in northern Alberta and for being a major source of greenhouse gas emissions (though this claim is actively disputed). Environmentalists in the US, with the backing of a group of Senators, have been working to block the authorization of construction of Keystone XL on environmental grounds, with the implicit assumption being that without access to US markets, this crude from the Oil Sands just wouldn't be produced. The Canadians though have a different take on the matter and now are just looking into an alternative pipeline route that would carry the production from the Oil Sands westward instead to the Pacific Ocean and eventually onto China.

The point here is that despite our perception of Canada as our over-polite, over-eager little brother who is always glad to follow in our footsteps, Canada is in fact its own country with its own culture, motivations and politics. And their path isn't necessarily the same as ours, so maybe we ought to pay a little more attention to them.

AU: Seal Off Somalia

Though they haven't been in the news lately, it seems the Somali pirates haven't given up their pirating ways. Over the weekend pirates seized a German cargo ship and a Singapore-flagged liquefied gas tanker heading from Kenya to the Seychelles Islands. There has been some confusion in the press reports over whether the Singapore ship, the MV York, was carrying liquefied natural gas (LNG) or a type of liquid gas, like gasoline. For the pirates it probably doesn't make a difference, their standard operating procedure is to hold a ship and crew for ransom, not to try to offload and sell the ship's cargo.

The capture of the two ships likely points to a seasonal uptick in piracy off the Somali coast, which tends to increase at the end of the year when the weather patterns in the Indian Ocean become more favorable to the pirates. The attacks also mark some of the furthest the pirates have ventured fropm Somalia so far – the German ship was seized nearly 1,200 miles from the coast of Kenya, while the MV York was taken 170 miles from Mombasa, which is near Kenya's southern border – far from Somalia. The European Union Naval Force, which is helping to coordinate anti-piracy patrols in the Indian Ocean said they believe the Somali pirates currently hold close to 20 ships and nearly 400 sailors.

The African Union meanwhile has formally requested that the United Nations endorse a military mission to completely seal off Somalia's borders from land and see. Under the plan suggested by the AU, a UN-led naval force will engage in a total blockade of Somalia's 1,500 miles of coastline both to try to halt piracy in the Indian Ocean and to stop the flow of weapons and foreign fighters into Somalia. On land a contingent of 6,000 AU peacekeepers is fighting a running battle with Islamist militias in the capital, Mogadishu, all in an attempt to keep Somalia's fragile Transitional Federal Government (TFG) in power. The AU would like this peacekeeping force bolstered to 20,000; funded in large part by the United Nations. So far the AU troops have had their hands full trying to maintain control over just a portion of Mogadishu; expanding this security operation out into the countryside will be impossible without additional troops and funding, and so long as Somalia remains without a functioning government, Somalia will remain a haven for pirates and possibly al-Qaeda-linked militias.

The African Union plan is supported by the Somali TFG's foreign ministry, no word yet on whether the United Nations will throw their support behind the plan as well.

Brazil, Kenya, And The Future Of Energy

In another sign of Brazil’s growing global clout, President Lula di Silva made a visit to Kenya a key stop on his whirlwind tour of Africa; the Brazilian president is trying to build ties with Kenya, which Brazil feels could serve as an anchor that the South American country could then use to build ties with the rest of the East African Community – a trading bloc that includes five nations and 125 million people.

One specific area where Brazil is willing to lend a hand to Kenya is in the area of biofuels. Brazil is one of the world’s top producers of biodiesel (diesel fuel made from plants rather than crude oil), a distinction that has allowed Brazil to become energy independent while maintaining a strong rate of domestic growth. Biofuel production is currently only done on a very small scale in Kenya, but the Kenyan government is eager to change that and Kenyan farmers have been turning more of their land over to the production of biofuel crops in recent years. Of course that might not be a good thing and if you watched 60 Minutes this past Sunday, you probably know what I’m getting at here. 60 Minutes did a story on what they called The Great Migration, the annual trek by millions of animals across the Maasai Mara plains in Kenya, the last migration of land animals of this scale left on the planet. But the Great Migration may be in danger; the Mara River, the source of the water that grows the plants that are the cause of the migration is drying up. And the most likely reason for the Mara drying up is the deforestation of the lands at its source, deforestation occurring so that the land can then be cultivated. While Kenya is now trying to preserve the forests at the Mara’s headwaters, increased demand for biofuel crops will only encourage farmers to clear more land for cultivation and reduce the amount of water the land is able to capture in seasonal rains and then funnel into the Mara River.

Along with help in producing biofuels, Presidents di Silva and Mwai Kibaki of Kenya talked about Brazil assisting Kenya in building ports, hydroelectric plants and rehabilitating Kenya’s dilapidated network of highways. Kenya’s long-term goal is to be considered a “fully developed” nation by 2030. Brazil, meanwhile, is trying to establish itself as a fully-fledged player in global politics, and sees development deals, like the one struck with Kenya, as a way of displaying their clout on the world stage.

Ethiopia Charges Ahead With Electric Car

Electric vehicles have been all the rage at the New York International Auto Show this past week, but an Italian firm chose a place half a world away to unveil their entry into the electric market. Freestyle PLC has finalized plans to start production of the Solaris Elettra in Ethiopia; a move they hope will help to spark a “green revolution” in Africa.

The battery-powered Solaris Elettra is expected to have a range of between 50 and 100 miles on a full charge and should cost between $12,000 and $15,000. Freestyle says that production will begin slowly, with only six cars being built each week for the next several months until a new factory in the capital, Addis Ababa, is completed. Once the factory is operational, it will produce up to 30 Solaris Elettras per week and will eventually employ 350 people. Freestyle, which builds renewable energy power systems, hopes that the cars will eventually be exported across Africa and perhaps even to Europe. Their slogan for the Solaris Elettra is “from a green country to a green world.”

But auto industry analysts who spoke with the BBC are skeptical of Freestyle’s rosy projections, saying that the cost of the car – coupled with the 100% tax levied on new vehicles - would put a Solaris out of reach of most Ethiopians. And they question whether an electric-powered car is even practical for Africa, given the spotty electrical service available in much of the continent and the long distances between many African cities, which could make travel in an electric car impractical. Freestyle counters by saying that a hydroelectric dam currently under construction on the Omo River will give Ethiopia a cheap, reliable and plentiful source of electricity. The country expects that the hydroelectric plant will make Ethiopia a net exporter of electricity in Eastern Africa in the coming years.

The Politics of Pipelines

My latest post over at The Mantle and World Policy Journal takes on Europe's need for natural gas and the politics that surround the supplies. Right now Europe gets a significant portion of their natural gas from Russia - a situation that the European Union would like to change and that Russia would like to maintain. Read about the lengths that each side is willing to go to meet their goal, and the role that Turkey could one day play in the gas supply drama.

Energy Company's Boast About Melting Glaciers

Today energy companies fund huge advertising campaigns to promote just how environmentally-friendly (or "green") they are, but that wasn't always the case. Check out the ad below, it's a glossy two-page magazine spread from the early 1960's where Enco (a subsidiary of Humble Oil, which later became part of ExxonMobil) boasts about supplying enough energy to melt seven million tons of glacier each day.


Of course 40-odd years later, if Enco were still around, they'd likely be running spots on TV touting their bio-fuels research efforts and employing lobbyists to question whether there really is a link between fossil fuels and global climate change. Funny how times change...

Is Iran Really a Threat?

That is the question the Compass Blog over at RealClearWorld is asking, at least in regard to America's security. Writer Greg Scoblete cites an article in London's Daily Telegraph that argues Iran is a bigger threat to global security than even Afghanistan or Pakistan. Scoblete notes though that Iran's threat isn't global but instead aimed at two specific regions/goals - Israel and disrupting the flow of oil out of the Persian Gulf, and there have been no acts of terrorism on American soil - actual or attempted - that have been traced back to Iran.

Meanwhile a media event staged by the Pakistani military this morning to tout their recent offensive against terrorist groups in their Waziristan region turned up passports of militants linked to both the Madrid train bombings of 2004 and the 9/11 attacks.

It does make you wonder...

Fox News "Expert" Shows She's Clueless On Russia, India

Every time I need inspiration to do this site I happen to see something like the the exchange I saw this morning between Fox News anchor Bill Hemmer and FNC "foreign policy expert" KT McFarland, a former deputy assistant secretary of defense for public affairs and speech writer during the Reagan administration.

Bill and KT were breathlessly discussing the "breaking news" on Fox that the Russians were developing some kind of super-missile. I figured out that they were talking about the BrahMos supersonic cruise missile, a weapon so secret that it has its own page on Wikipedia. Not only that, but this only counts as "breaking news" if this is, say, 2003 - India and Russia have jointly been developing, and now producing, the BrahMos for several years, in fact the missile is currently in service with the Indian military. Bill and KT wondered aloud why, since President Obama "reset" relations with the Russians, were they even developing new weapons in the first place? (Probably for the same reason the US, China, Great Britain, France, Israel, etc. keep developing new weapons systems...)

But KT wasn't done flaunting her ignorance yet. She went on to say that Russia now had a stranglehold on energy supplies to Europe thanks to their new Nord Stream and their second "southern" pipeline. The problem here is that construction on Nord Stream, which will run under the Baltic Sea from Russia to Germany, won't even start until next year. South Stream (the "southern" pipeline) is still on the drawing board and facing stiff competition from the Nabucco Pipeline (also still in the planning stages), which would link Central Asia and Europe, bypassing Russian territory entirely.

She then went on to chide Obama for cutting funding for the anti-ballistic missile shield bases in the Czech Republic and Poland, leaving us vulnerable to the new Russian super-missile (which the ABM system would have been useless against anyway since the BrahMos is a cruise missile that flies just meters above the ground, not a ballistic one that flies in a high, arching trajectory - the target of the ABM system). Finally she said (and Bill agreed) that India's decision to work with Russia on the BrahMos was because Obama had "weakened" America on the world stage - apparently ignorant of the fact that Russia (and before them the Soviet Union) had been a major arms supplier to India for decades, and that among other systems, Russia is in the process of supplying India with an aircraft carrier, and once the Nerpa completes its sea trials, a nuclear attack submarine.

That's an awful lot of misinformation to pack into just three minutes...Frankly, I don't blame Hemmer so much for this ridiculous segment - he's just a typical news channel talking head, someone who looks pleasant and can read a teleprompter, but who has no real knowledge about, well, anything. McFarland though is another matter. Someone who was deputy assistant secretary of defense for public affairs should know a little something about two of the world's larger military powers. Next time Fox News wants to put on an "expert" on foreign affairs, they should find someone who knows what they're talking about in the first place.

China's New BFF, East Timor

We've written here before about how China is throwing around huge sums of money in Africa in return for access to the resource wealth of a number of African nations. Now China is courting a new friend closer to home, the tiny nation of East Timor (or Timor Leste as it's known in Portuguese).

East Timor has a tumultuous recent history. The largely Roman Catholic former Portuguese colony finally won its independence from largely Muslim Indonesia after three decades of brutal occupation by the Indonesians. That occupation left between 100,000 and 200,000 Timorese dead and the country largely in ruins. So along with being one of the world's newest countries, East Timor is also one of its least developed.

But East Timor does have potentially huge oil and natural gas reserves, along with valuable mineral deposits, so in comes China. So far the Chinese government has spent more than $50 million on East Timor - a fraction, Reuters points out, of the $700 million in aid East Timor's main patron, Australia, has spent so far on the country - but China has spent its money in high-profile ways, building government buildings that include the new Presidential Palace, the Ministry of Defense and the Foreign Ministry headauarters. China is also investing in building two power plants in the capital, Dili. Chinese entrepreneurs are also heading to East Timor, opening stores in Dili and building on a cultural link between the two countries that dates back 500 years when Chinese sailors first set up a trading post in Dili.

In return, China is hoping that their state-run oil company, PetroChina, will be allowed to sign lucrative deals to drill in the potentially rich oil deposits off the coast of East Timor. Of course Chinese officials say that their foreign aid isn't meant to influence the Timorese government when the time comes to award the oil and gas contracts.