The Federal Government at Abasand

The Abasand Oils Ltd. plant was located on the Horse River, on land reserved for use of the Canadian National Parks Branch (now Parks Canada). Control of this land was not transferred to the province of Alberta with the passage of the Alberta Natural Resources Act in 1930. Even when it became obvious that oil sands was not suitable for paving roads, the federal government retained the reserve. As a consequence, Abasand Oils Ltd. did not have to pay royalties to Alberta or deal with any provincial regulations. Furthermore, when the federal government decided to take over operation of the plant in 1943 as an emergency wartime measure, there was no need to consult the province.

Karl Clark, and others interested in the development of the oil sands, were initially pleased that the Canadian government was getting involved.

A Federal government effort on an Alberta government resource in relation to the war effort could be expected to make use of all available facilities, according to my thinking at that time. However, it did not work out that way. A change of attitude was noticed very quickly…Relations were getting worse rather than better…[By] the fall of 1943 the provincial government was not so sure it was pleased. Things were going in a screwy fashion at the Abasand plant and there were serious grounds for fearing that the outcome of it would be detrimental to the development of the bituminous sands. The province could not afford to let things drift without doing something itself to counteract a fiasco at Abasand.

A number of events caused alarm. A parade of knowledgeable and experienced staff members was let go by the new management, until no one with any significant first-hand knowledge of the oil sands remained. A new, untested separation process was selected to replace the McClave hot water process, and the government staff and private companies hired to implement the expansion of the plant did not consult with staff of the Research Council of Alberta on any aspect of the work. A great deal of money was expended on the construction of accommodations and improvements to camp living conditions, but little seemed to be happening in the plant.

The Hon. William A. Fallow, Alberta’s Minister of Public Works from 1935 to 1948, was incensed at the lack of progress being made at the Abasand plant, especially in light of the vast sums of money being spent on it. It was reported that as much at $2,000,000

was expended to upgrade and convert the plant, but after more than a year, it was still not operating.

Fallow took to the floor of the Alberta legislature to voice his outrage. He went so far as to characterize the actions of the federal government at Abasand as sabotage of the effort to develop the oil sands resource. Clark was more subdued in his response, and described the Abasand “fiasco” as the result of bungling, ineptitude and ignorance, rather than malicious intent.

Partially in response to the situation at Abasand, the provincial government entered into an agreement with Oil Sands Ltd., the successor to Robert Fitzsimmons’s International Bitumen Company Ltd., to develop a pilot plant at the other privately-owned oil sands separation operation: Bitumount.

The Abasand Plant burned to the ground in the spring of 1945 and was not rebuilt.