The Trans Mountain crude oil pipeline.
Credits: COURTESY PHOTO
The Canadian Energy Research Institute (CERI) said Thursday the combined value from the construction of the proposed Northern Gateway pipeline and the Kinder Morgan pipeline expansion to the Lower Mainland will bring BC almost $10 billion in Gross Domestic Product (GDP), forecast over 25 years.
BC Premier Christy Clark sparked a rift with other provinces over her declaration that there's not enough financial reward to offset any risk for BC with the proposed 1,177 km Northern Gateway pipeline taking Alberta bitumen to the port of Kitimat, BC.
The construction and operation of the $5.5 billion pipeline alone will be better for BC, said CERI research director Dinara Millington.
"For both the pipelines, BC will see higher economic benefits than any other province in Canada. This is based on the fact that both will be operated and constructed in the province," Millington said.
Construction of the Northern Gateway would bring $4.7 billion in GDP for BC over 25 years, compared to $2.9 billion for Alberta, Millington said.
Construction of Kinder Morgan's TMX pipeline to Burnaby, BC, would bring in $4.4 billion in GDP for BC over the same period, compared to $2.2 billion for Alberta, she said.
The figures come from analysis of input and output as well as capital spending to construct and expand lines, she said.
Economic benefits accrued from increased upstream oilsands production are not calculated into the figures.
BC's Liberal Premier Christy Clark and BC Environment Minister Terry Lake were not available for comment Thursday, spokesmen for their offices said.
According to figures released by B.C. at the time of the Council of Federation premiers' meeting, of the expected $81 billion in royalties and taxes projected to be raised over 30 years between 2016 and 2046, BC is slated to receive about $6.7 billion -- that's 8.2%. And it's not enough, Graeme McLaren, assistant deputy minister at BC's ministry of energy and mines, said at the time.
"You can see from the numbers that BC's share is relatively small right now, so that's the nature of the negotiations, to find that more balanced fair share," McLaren said.
Clark, who's in a pitched pre-election battle with BC's anti-Northern Gateway New Democratic Party, gave five ultimatums for her province's OK on the Northern Gateway.
The pipeline has a number of environmental and First Nations groups up in arms, but Clark indicates she's willing to go there if the price is right and the province can get more help to offset environmental risks.
The stakes are rising in the bid for the Northern Gateway, seen by some as crucial to Alberta and the oilsands that function as an economic engine for the Canadian economy.
Northern Gateway's parent company, Enbridge, recently committed an additional $500 million for increased monitoring and safety measures on the pipeline.
The Alberta-based company took out full-page ads this week in several Canadian newspapers to tout their safety record after taking hits in a scathing July report from the US National Transportation Safety Board faulting lax monitoring in their Edmonton control centre that contributed to America's worst-ever land spill, near Marshall, MI, in July, 2010.
In July, Alberta Premier Alison Redford said Enbridge's efforts, combined with the fact that pipelines are still by far the safest means by which to transport oil, significantly mitigate the environmental risk and weaken the BC government's argument for compensation based on potential risk.
"As Alberta has said repeatedly, and as we saw in the recent report from the Senate's Energy, Environment and Natural Resources Committee, accessing new energy markets is a national imperative. It is essential for the economic benefit of Canada," she said.
Prime Minister Stephen Harper has been supportive of the Northern Gateway. Harper said Thursday the line's in the vital interests of both Canada and BC because of commerce with the Asia-Pacific region, but that science and not politics should determine the outcome of the joint review regulatory process underway with the National Energy Board.
B.C.'s four other conditions:
- Recommendation by the National Energy Board Joint Review Panel.
- World-leading marine oil spill response, prevention and recovery systems for BC's coastline and ocean.
- World-leading practices for land oil spill prevention, response and recovery systems.
- Legal requirements regarding Aboriginal and treaty rights are addressed, and First Nations are provided with the opportunities, information and resources necessary to participate in and benefit from the pipeline.