Social Damage

Tar sands industry growth is being completely unmanaged by the Alberta government, leading to problems in housing, services, and the overall standard of living for many Albertans. Additionally, residents are seeing very little benefit from the resource exploitation through royalty rates. The only benefactors of industry growth have been corporations and those already in the top income bracket. Low income residents have seen a decrease in living standards, mainly due to increases in rent and living costs and no significant increases in wages to compensate.

Alberta people and their Heritage Fund receive among the world’s lowest royalty returns on the extraction of oil from the tar sands. Alberta's budget painted a bleak outlook for the future of the province's oil and natural gas royalties. The new royalty structure, which will come into effect in 2009, doesn’t improve the bleak picture by much. The amount of royslties the government receives will still decrease over the next few years, even as production is surging and energy companies are booking their best-ever profits.

Insufficient priority has been put on upgrading Alberta’s oil production for long term development by stimulating, for example, petro-chemical manufacturing and stopping raw bitumen exports. Additionally, the Keystone Pipeline has been approved to eventually export 1milliion barrels per day of oil to the United States for upgrading; reducing the control Albertans have over their energy future, jobs, and resources. Foreign ownership of the petroleum industry in Alberta by major U.S. oil companies substantially reduces the ability of the Alberta government to ensure that development priorities and conditions are met.

Haphazard development, due to the rapid dispersal of production permits for the tar sands has led to the overheating of the Albertan economy and an uneven pattern of economic growth.

The boom and bust pattern of development has been generating serious social damage for the people and the local economy and society of Ft. McMurray and surrounding Wood Buffalo region. Social services are collapsing in the region where local governments have had to cope with a rapidly growing population along with severe housing shortages, poor garbage clean-up, rundown schools and health facilities, rising crime rates and bad roads.

Lastly, cheap labour practices allow oil companies operating in the tar sands to cut their labour costs by hiring non-unionized workers and workers from other countries, thereby circumventing the building trades unions and proper work standards in Alberta and skewing the skilled trades’ pool and wages in Ontario, Quebec and Atlantic Canada.