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Energy Answers Await At Our Doorstep

Daniel S. Sullivan, Assistant Secretary for Economic, Energy, and Business Affairs, and Thomas A. Shannon, Assistant Secretary for Western Hemisphere Affairs
Op-Ed in Investor's Business Daily
Washington, DC
June 23, 2008

Canada is our single-largest energy supplier, providing 17% of U.S. oil imports. In 2007, Canada provided more petroleum than the two next top suppliers. Canada is also our top supplier of natural gas (16% of total supply in 2006) and a major supplier of electricity.

Canada's mature democracy, open investment environment and strong rule of law make it an exceptionally stable and reliable energy supplier.

The annual Energy Consultative Mechanism meeting that U.S. and Canadian officials convened on June 10 exemplifies the enduring strength and mutually beneficial nature of the U.S.-Canadian economic and security relationship.

During these meetings we discussed the potential impacts of U.S. energy legislation on our continued energy relationship, as well as ways to facilitate the development of proposed pipelines to bring Alaska's natural gas to the lower 48 states.

According to current estimates, when oil sands are included, Canada's energy reserves are second only to Saudi Arabia's, with a reported 179.2 billion barrels of proven oil resources.

The bulk of these reserves (over 95%) are oil sands deposits in the Canadian provinces of Alberta and Saskatchewan. Canada produces up to 2 million barrels of oil a day from the oil sands deposits, which have become vital to North American energy security.

Canada has also been working to reduce the greenhouse gas emissions from these deposits by using carbon capture technology and through more efficient use of natural gas in production.

Additionally, oil sands producers are now recycling 90% to 95% of the water used in production and have instituted aggressive land-reclamation programs. The Canadian province of Alberta, where the majority of oil sands deposits are located, is the only jurisdiction in North America to legislate industrial reductions in greenhouse gas emissions. They project that these and other measures will yield a 50% reduction in absolute emissions over 2005 levels by 2050.

But U.S.-Canadian ties go much deeper than energy. Canada is our top export market. Since the signing of NAFTA in 1994, total trade between Canada and the United States has grown by 250%, U.S. employment has increased by 25 million jobs, and U.S. manufacturing output has increased by 63%.

At the North American Leaders' Summit in New Orleans this April, President Bush, Canadian Prime Minister Stephen Harper and Mexican President Felipe Calderon called on our governments to enhance cooperation to strengthen energy security and protect the environment.

The leaders agreed to enhance our electricity networks, increase vehicle fuel efficiency and develop clean energy technologies, while noting steps already taken to harmonize energy efficiency standards for key products.

In addition, the recently concluded Energy Consultative Mechanism meetings led to an agreement between the U.S. and Canada to stay in close contact and to establish a working group focusing on economic and environmental aspects of the world's largest bilateral energy relationship.

Ultimately, increasing U.S. energy security involves looking for new sources of oil, developing alternative energy sources and improving energy efficiency through technology. But as energy challenges for the U.S. mount, it's reassuring to know that part of the solution is found with our good neighbor, Canada.

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