Protecting Canada's Critical National Infrastructure from Terrorism

Abstract

In 200 2 the government of Canada introduced the national security policy, its first ever, which identified critical infrastructure protection as one of its priority concerns.1 Five years later, in August 2007, the government promulgated the emergency management act, which affirmed federal authority over critical infrastructure protection. Since then, Public Safety Canada has been working on a national strategy and action plan for critical infrastructure, which still awaits federal-provincial-territorial consultations, now scheduled for mid-2009.2 m *he interim, no further steps have been taken to articulate the details of a national strategy for the protection of Canada's critical national infrastructure against exogenous risks and threats.This study will provide an assessment of current threats to Canadian energy interests stemming from international terrorism and will examine the existing governmental architecture for the protection of this country's critical infrastructure. After identifying certain institutional and operational deficiencies in relation to the evolving threat environment, the article will explore new policy initiatives to enhance the protection of Canada's energy infrastructure from international terrorism.The energy sector is a lynchpin of the Canadian economy and a leading sector in the regional economies of Alberta, Newfoundland, and Saskatchewan. Oil and gas production contributed 4.2 percent of Canada's gross domestic product in 2003, the latest year for which data is available. In previous years the energy sector as a whole contributed over seven percent of GDP and accounted for annual investment of some $24 billion. To be sure, the oil price surge of 2004-08 greatly increased the energy sector's value added to Canada's economy. The activities of the sector encompass the production, refining, and delivery of petroleum and natural gas, and the generation of electric power from hydro, oil, gas, coal, and nuclear power plants. These energy resources are vital for interdependent industries, commercial facilities, public and social services, and household requirements.Canada's energy economy is closely integrated continentally with that of the United States through pipeline networks, electricity grids, and extensive commercial interactions among owner-operators in the industry. More than half of Canadian energy production, including petroleum, natural gas, and electricity, in terms of oil equivalents, was exported in 2002.3 Exports of energy products totalled $60.5 billion in 2003, or about 15 percent of Canadian merchandise exports.4 Of these energy sector exports, natural gas contributed $26 billion, petroleum $20 billion, and other energy products $13 billion. Canada's energy economy is closely interconnected through infrastructure links to an integrated North American energy market5 Over 99 percent of Canadian crude oil exports, and some 56 percent of natural gas exports, are destined for the US. By 2006 Canada had become the single largest international supplier of oil and natural gas to the US. Continental energy integration is further sustained by regional trading arrangements, formalized in the North American free trade area and reiterated in the security and prosperity partnership.The Canadian energy industry is critical for the national, provincial, and local economies, for consumers and user industries, and for public wellbeing generally. Oil, natural gas, and electricity production are operating at or near capacity, with little if any spare capacity or redundancy readily available. A sudden loss of production capacity because of terrorist attacks, or any other major damage to energy infrastructure, would bring about immediate shortages of supply, which in turn would cause prices to spike. Owing to interdependencies between energy and most other economic, social sector, and household requirements, any disruption to the energy nexus would inflict profound and far-reaching hardships upon Canadians. …