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Secretary of State Candidate Susan Rice Has a Major Financial Stake in Canadian Tar Sands

Rice holds significant investments in more than a dozen Canadian oil companies and banks that would stand to benefit from expansion of the North American tar sands industry.
 
 
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US Ambassador to the United Nations Susan Rice is seen in the US Capitol.
Photo Credit: AFP

 
 
 
 

This story first appeared in OnEarth.

Susan Rice, the candidate believed to be favored by President Obama to become the next Secretary of State, holds significant investments in more than a dozen Canadian oil companies and banks that would stand to benefit from expansion of the North American tar sands industry and construction of the proposed $7 billion  Keystone XL pipeline. If confirmed by the Senate, one of Rice’s first duties likely would be consideration, and potentially approval, of the controversial mega-project.

Rice's financial holdings could raise questions about her status as a neutral decision maker. The current U.S. ambassador to the United Nations, Rice owns stock valued between $300,000 and $600,000 in TransCanada, the company seeking a federal permit to transport tar sands crude 1,700 miles to refineries on the Texas Gulf Coast, crossing fragile Midwest ecosystems and the largest freshwater aquifer in North America.

Beyond that, according to  financial disclosure reports, about a third of Rice’s personal net worth is tied up in oil producers, pipeline operators, and related energy industries north of the 49th parallel -- including companies with poor environmental and safety records on both U.S. and Canadian soil. Rice and her husband own at least $1.25 million worth of stock in four of Canada’s eight leading oil producers, as ranked by Forbes magazine. That includes Enbridge, which spilled  more than a million gallons of toxic bitumen into Michigan’s Kalamazoo River in 2010 --  the largest inland oil spill in U.S. history.

Rice also has smaller stakes in several other big Canadian energy firms, as well as the country’s transportation companies and coal-fired utilities. Another 20 percent or so of her personal wealth is derived from investments in five Canadian banks. These are some of the institutions that  provide loans and financial backing to TransCanada and its competitors for tar sands extraction and major infrastructure projects, such as Keystone XL and  Enbridge’s proposed Northern Gateway pipeline, which would stretch 700 miles from Alberta to the Canadian coast.

In 2010, for instance, when Rice and her husband held at least $1.5 million in Royal Bank of Canada, the institution was labeled  Canada's most environmentally irresponsible company by the Rainforest Action Network for its support of tar sands development. Public pressure from environmentalists and Canada’s First Nations tribes convinced the bank to  stop funding tar sands projects earlier this year.

“It’s really amazing that they’re considering someone for Secretary of State who has millions invested in these companies,” said Bill McKibben, a writer and founder of the activist groups  350.org and Tar Sands Action, which have organized protests against the Keystone XL project. “The State Department has been rife with collusion with the Canadian pipeline builders, and it’s really distressing to have any sense that that might continue to go on.” Emails obtained by an environmental group last year show what critics call a “ cozy and complicitous relationship” between State Department officials and a lobbyist for TransCanada, who was also a former deputy campaign director for current Secretary of State Hillary Clinton's failed 2008 presidential bid. The agency also assigned an environmental impact review of the Keystone project to a  company with financial ties to TransCanada.

As ambassador to the United Nations, Rice has not been directly involved in the State Department’s Keystone XL review, which came to a head at the end of 2011. After initially indicating it would likely approve TransCanada’s application, the State Department  ordered a review of alternate routes to avoid putting critical water sources in Nebraska at risk. The move, which officials said would likely push the approval process back to the first three months of 2013,  was an attempt to spare the Obama administration a politically risky decision just before an election year.

 
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