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ENVIRONMENT: Companies Scramble for Ever-Scarcer Resources

Wolfgang Kerler

NEW YORK, Oct 1 2008 (IPS) - As humanity runs out of oil and minerals, the extraction of previously untouched deposits suddenly pays off – financially. But experts warn that it will likely further accelerate climate change and seriously damage the environment.

Back in the 19th century it was easy to discover an oil well: one could accidentally step in a puddle of “black gold” – it made its way to the surface voluntarily. But with conventional oil wells running dry, the industry is shifting to so-called “unconventional” sources like tar sands – but not without problems.

“It takes two to three times more energy to get a barrel back from tar sands than from conventional crude oil,” said Steve Andrews, co-founder of the U.S.-based Association for the Study of Peak Oil and Gas (ASPO), in an interview with IPS.

Hand-in-hand with the needed large amount of energy is significantly more carbon emissions, which is counterproductive in the global fight against climate change.

Other unpleasant byproducts are vast ponds full of toxic water, such as are used during the production of synthetic oil from tar sands. Hundreds of waterfowl have already died in those contaminated tarns.

Nevertheless, as the price of oil has more than tripled in the last few years – it is now around 100 dollars per barrel – the cost-intensive mining of tar sands has become more and more profitable.

With an estimated 173 billion barrels, the world’s largest deposits are found in Alberta, Canada, making the country’s oil reserves only second to those of Saudi Arabia.

But as Andrews said: “All barrels aren’t created equally.”

After four decades of excavation and engineering, the flow of oil from Canadian tar sands is still covering less than two percent of worldwide consumption, which is about 85 million barrels a day.

In contrast, Saudi Arabia accounts for 12 percent of worldwide production.

Andrews points out that all major sources of unconventional oil – which also include extra-heavy oil from Venezuela and oil shale from the United States – share the same problems.

He also warned that off-shore drilling or oil extraction in the Alaskan Arctic National Wildlife Refuge (ANWR) “will not be a saviour” of the United States’s energy problems.

Biofuels such as corn-based ethanol, which have been criticised for driving up food prices, are too land-intensive and will never be an adequate substitute for fossil fuels, he added.

“All those measures will only slow down the decline in worldwide oil production but they cannot stop it,” said Andrews. “The alternative which shows the most promise to reduce environmental problems is an electric-powered transportation system running on renewable energy.”

Andrews and other experts from ASPO are expecting global oil production to peak in the next two to five years – despite the various substitutes for conventional crude oil, and despite the fact that demand is still growing.

A study for the United States Energy Information Administration (EIA) is somewhat more optimistic, estimating peak crude oil production to occur between the years 2021 and 2112.

According to the BP Statistical Review of World Energy, the worldwide level of production has not significantly changed since 2005. It oscillated between 81 and 82 million barrels a day – with a small decrease in 2007.

But oil should not be the only matter of concern.

Studies from Australia and Italy point out that peaks in the production of some minerals are to be expected in this century, too – for example, of copper and gold. Others like mercury and phosphate might have hit their peak already.

The growing scarcity involves greater endeavours in mining which are again – as in the case of oil – doing greater harm to environment.

“The deposits we are going after now have lower concentration of minerals. And where concentration is lower, there is more waste,” Ramsey Hart, Canada programme coordinator of Mining Watch, told IPS.

Enormous quantities of waste rock loaded with heavy-metals and other toxic substances are left behind and contaminate water and air. Moreover, mining often leads to the destruction of natural habitats.

Lower concentration of minerals also means that much more energy is needed to extract it from the rock – hence, more carbon emissions.

“Recycling metals is much more energy-efficient,” said Hart. He also called for improved waste handling by the mining industry.

“Companies are now looking to areas that were previously considered to difficult for mining – politically and logistically,” said Scott Cardiff, international campaign coordinator of the Washington-based group Earthworks, which focuses on the destructive impacts of mineral development.

He told IPS that limited supply and high demand are the reasons for the expansion of mineral extraction – especially in the case of gold, which is increasingly seen as a secure investment.

“In many cases mineral extraction is also continuing to expand to new areas as the result of political developments, including promotion of extractive industries by donor countries and international financial institutions,” Cardiff said.

“Madagascar is an example of a country where mining is about to boom and where mining is affecting plans for new protected areas,” he said.

And he gave more examples.

If approved, a copper-gold mine project in southwest Alaska’s Bristol Bay could cause serious damage to the local ecosystem – which is of vital importance for the world’s stock of wild salmon.

According to Earthworks, another gold mine, which is planned in Ghana, would destroy over 180 acres of forest in the Ajenjua Bepo Forest Reserve.

Besides significant investments in renewable resources like wind and solar. Ramsey Hart offered a simple idea to solve the problems of diminishing natural resources, climate change and ecological destruction: “We just need to become more comfortable and satisfied with a lot less stuff.”

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