It was Canadian Prime Minister Pierre Trudeau who once announced, “Canada is a country whose main exports are hockey players and cold fronts. Our main imports are baseball players and acid rain.” Yet the head of state’s wry humor belies the significance of the U.S-Canadian relationship, and how this relationship is destined to shape – and to be shaped – by the posture that the United States takes towards the explosion of unconventional oil production occurring because of the Canadian oil sands.
Conventional wisdom would suggest that the prospect of a nearly 2,000 mile long pipeline between Canada and the United States, the TransCanada Corporation’s “Keystone XL” project, should be welcomed as a harbinger of closer ties and safer energy supplies. Under the surface, however, lies a complex geopolitical and commercial logic that suggests it is Canadian producers – not American consumers – who stand to gain most from the project.
Our neighbor to the north will hardly ever receive the bursts of attention or scrutiny that Saudi Arabia or China garner in present times, but it is this bromidic consistency on Canada’s part which places it squarely, albeit quietly, as a foundation of US energy policy. The US has been Canada’s largest market reaching back to the beginning of the Cold War, and the two are currently the world’s largest trading partners. Canada has the world’s second largest oil reserves – after Saudi Arabia – and is the United States’ number one source of oil imports, almost doubling the volume of its closest competitor – Mexico. In 2008, Canada provided 90% of US natural gas imports, and also boasts one of the world’s largest reserves of high-quality uranium. Were the country anything other than a stable Western democracy sharing a similar colonial heritage with the United States, our deep interdependence with such an energy superpower might prove alarming. Instead, it is often cited as a source of strength.