Roughly 27% of all petroleum imported into the US is from Canada. Canada is the largest exporter of petroleum to the US. Roughly 49% of the total Canadian oil production is from heavy bitumen or oil sands . Canadian production of petroleum from oil sands is very important for the US in order to reduce dependence on oil from unstable countries. It is also important for Canada because petroleum production by oil sand mining has made Canada a substantial net exporter of petroleum . Hence, it is important to understand the environmental impacts of petroleum production from oil sands mining. (Photo credit : )
Crude from oil sands is a thick mixture of sand, dirt, water and bitumen that is semi-solid at room temperature. Transporting and processing this thick mixture of bitumen has to be done at high temperatures. Thus, extracting petroleum from such heavy crude requires lot of energy and water and in turn will result in release of significant amount of greenhouse gases . Overall, oil sands production is the single largest contributor of green house gases in Canada . The process of mining and refining also causes significant environmental impacts, including huge emissions of global warming gases, destruction of wildlife habitat, and impacts to air and water quality . It has been reported that the land reclaimed from oil sand mines are permanently affected and cannot be restored to their original quality. A study reveals that land reclamation has caused massive loss of peatlands and hence, the loss of their carbon storing potential . A report from Royal Society of Canada found the following environmental impacts  –
1) Contamination of downstream water and regional water supply
2) Contamination of ground water quality
3) Contamination and destruction of wildlife habitat from tailings pond
4) Impacts on ambient air quality and green house gas emissions
Apart from the above environmental impacts to Canada, the US is particularly in danger of high pollution from oil sands. The completion of the Keystone pipeline will enable the heavy crude to be refined more efficiently in the refineries of the Texas Gulf coast. This will lead to higher pollution in the already polluted Texas Gulf Coast jeopardizing air and water quality in places like the Houston Ship Channel  .
At the federal level, the Canadian National Energy Board has the authority to regulate the oil sands industry pursuant to three different environmental statutes viz. Canadian Environmental Protection Act, Canadian Environmental Assessment Act and the Fisheries Act . At the provincial level, the provinces have legislation related to environmental protection. In Alberta, where most of the oil sand production is concentrated, the government has enacted the Oil Sands Conservation Act (Alberta Regulation 76/88) to regulate the oil sands industry . Critics of the regulations say that existing regulation is not effective in protecting the environment but more regulation is necessary . Also, the studies that have been initiated to study affects of oil sands on specific wildlife/regions have not been completed in time and hence have not been effective .