Total, the big French oil company and its two partners, announced it is cancelling its $11 billion Joslyn tar sands project due to rising costs.
In classic corporate gobbledygook here are the words of Andre Goffart, head of the Canadian operations, as reported by the Globe and Mail: “We are still in the cycle within this industry where cost inflation in general is going much faster than price adjustments. We know that there is a rebalancing that needs to be done.”
A rebalancing you say? This could be good news. Despite endless misleading statements from Big Oil and Canada’s Harper government, we know the Keystone Pipeline is the great enabler of the tar sands sector. If Keystone doesn’t get built many more costly oil projects will be mothballed. But the Obama Administration won’t be bullied into approving it and I have argued before the project is all but dead.
Here is a statement from Environmental Defence:
”Tar sands are high cost, high risk, and high carbon. Josyln North’s mothballing is the latest in a developing trend that doesn’t bode well for the industry’s future. The economics of the tar sands are marginal today. And in a carbon constrained world, they become increasingly unviable.
It’s no coincidence that this announcement follows the indefinite delay for the Keystone XL pipeline. Oil company Total was a major partner on the Josyln North project, and was also registered as a shipper on theKeystone XL pipeline.
The question is, will Canadians see the writing on the wall and unsaddle our energy and economic strategies from growth of a sector that comes with high risks and rewards that are far from secure? It is time to invest in clean and safe energy for the future of our environment and our economy.”
Canada, we need to find a more sustainable path for economic growth. Canada: it’s time.