PIPELINE – B.C. gov’t’s obstructionism on Trans Mountain disappointing

(Kinder Morgan photo)

An opinion released today, Feb. 1, 2018 by the Kamloops Chamber of Commerce on the B.C. government’s decision to restrict pipeline shipments of bitumen to current levels while it conducts spill response studies. 

THE KAMLOOPS Chamber of Commerce is disappointed at the ongoing obstructionism demonstrated by the provincial government.  Energy and its related products are a significant part of British Columbia’s and Canada’s annual exports.

Through development of expanded pipeline infrastructure, such as Trans Mountain Expansion Project (TMEP), our oil resources can create exceptional opportunities for B.C.’s small and medium-sized enterprises, serve as an important source of near-term and long-term job creation and generate lasting benefit for the province, municipal governments and their communities.

CoC Vice President

This infrastructure is critical to both the B.C. and Canadian economy, with the ability to transform Canadian oil producers from price takers to price makers in international markets.  In 2013, the Canadian Chamber of Commerce produced a study highlighting the fact that, due to the lack of infrastructure to markets other than the U.S., Canadian producers must sell their products at a discounted price, which can cost our economy up to $50 million a day.[1] This price differential, which takes away potential tax revenues that could be used to provide services for the people of Canada, should be a concern for everyone.

The $7.4 billion Trans Mountain Expansion Project is a key to unlocking that wealth. Through the expanded pipeline, oil producers gain increased access to tidewater and see their product transported to new markets that would pay world rather than North American domestic prices.[2] Despite a fallback in oil prices, the NEB estimates oilsands output will double by 2040 — and compensate for a long-term decline in conventional oil production. This demonstrates the ongoing need for the Project — producers need a safe, reliable and cost-effective way to get this oil to market, and a pipeline is the best option to support this growth.

Economic benefits generated during construction and 20 years of operations from the Trans Mountain Expansion Project include:

  • $46.7 billion in provincial/federal taxes including $5.7 billion to B.C.
  • $23 billion of GDP effects for B.C.

The Trans Mountain Project creates 189,000 person-years of work in B.C. through construction and 20 years of operations. Excluding construction, TMEP supports about 7,600 jobs per year. This includes jobs created when oil producers reinvest the additional oil revenue they earn as a result of access to world markets. In the Lower Mainland, job creation includes almost 1,100 full-time marine sector jobs as a result of the increase from one tanker call per week at Westridge Marine Terminal to one per day.

Local governments in B.C. along the Trans Mountain right-of-way will annually receive an additional $23.2 million in property tax payments. Those payments can support community services such as police and fire protection, recreation and infrastructure, and can also be used to reduce the size of property tax increases. Additional payments projected include:

  • $6.22 million to Burnaby
  • $1.304 million to Abbotsford
  • $1.278 million to Kamloops
  • $944,000 to Chilliwack
  • $594,000 to Hope
  • $513,000 to Clearwater
  • $441,000 to Surrey
  • $243,000 to Coquitlam

The Thompson-Nicola Regional District would receive an additional $7.484 million annually, followed by the Regional District of Fraser-Fort George (up $1.858 million) and the Fraser Valley Regional District (up $1.273 million).

Trans Mountain proposed, in a December 2013 Application to the National Energy Board (NEB), to expand its existing pipeline system, increasing daily capacity from 300,000 barrels to 890,000 barrels.

Following a 29-month review, the NEB, on May 29, 2016, concluded that the TMEP is in the Canadian public interest and recommended that the Federal Governor in Council approve the expansion. The NEB attached 157 conditions which address issues such as public safety, economic benefits, local job creation, emergency preparedness and emergency response, Aboriginal interests, environmental protection and safety along both the pipeline right-of-way and the marine tanker transport route. The NEB’s review was rigourous, involving a record 404 intervenors and more than 1,200 commenters.

On November 29, 2016, the Government of Canada accepted the NEB recommendation, noting that Canada needed to expand the markets for its oil products and saying that the Trans Mountain Expansion Project “will make that possible.”

On January 11, 2017, the Province of British Columbia announced that the Project had received its environmental certificate from the BC’s Environmental Assessment Office subject to 37 Conditions. The Province stated that TMEP met its Requirements for British Columbia to Consider Support for Heavy Oil Pipelines, known as B.C.’s Five Conditions. The project has met the pertinent environmental and social requirements.

It is clearly an important component in the ongoing health and success of BC’s economy.  We call upon the provincial government to recognize the due diligence conducted by the various regulatory and governmental bodies, and allow this project to move forward in a timely fashion.

The above statement was released above the name of Kamloops Chamber of Commerce vice president Joshua Knaak. 

About Mel Rothenburger (6753 Articles) is a forum about Kamloops and the world. It has more than one million views. Mel Rothenburger is the former Editor of The Daily News in Kamloops, B.C. (retiring in 2012), and past mayor of Kamloops (1999-2005). At he is the publisher, editor, news editor, city editor, reporter, webmaster, and just about anything else you can think of. He is grateful for the contributions of several local columnists. This blog doesn't require a subscription but gratefully accepts donations to help defray costs.

2 Comments on PIPELINE – B.C. gov’t’s obstructionism on Trans Mountain disappointing

  1. So to summarize what I read the author’s opinion to be on the matter: “As long as the money’s good, damn the torpedoes, let’s get it built!” Have I got that right?

    I saw no mention or explanation of why Alberta wants to sell raw material, rather than a value-added product after refining it themselves. If the economics are really aimed at helping the average Joe, you’d think selling raw product wouldn’t be a great idea. But perhaps selling raw product is better for the shareholders?

    I also saw no mention of the economic costs associated with a spill. The author should perhaps read the wikipedia article on the Kalamazoo River Oil Spill as a good primer for the impact of a dilbit spill. Estimates of that spill suggest around a million gallons of dilbit entered the river. ONE of the tankers currently in use apparently carries close to FIFTEEN million gallons of the stuff. If you want to talk dollars, ponder the costs associated with a spill of that magnitude. They spent over a BILLION dollars attempting to clean up that mess. In a river. Extrapolate that to an ocean scenario and potentially fifteen times the material to clean up. They ended up dredging the river. How do you dredge the ocean? What happens to BC’s fishing industry? What happens to the tourist industry? It isn’t just the cleanup cost at issue!

    Making decisions based entirely on dollars and cents is dangerous. It should instead be ‘dollars and sense’. Of course economics (dollars) are a reality in the decision making process, but that doesn’t mean we can afford to forget about the ‘sense’. Apparently Governor Inslee (Washington State) understands this, as he just denied an application for a permit to put crude oil on ships in their Vancouver port. Crude oil, not dilbit.

    Oil is our past, not our future. We need to understand and accept that reality…and make decisions that put us on the right track for what’s coming. To do otherwise will put us well behind the competition, which will ultimately cost us substantially more than what we (well, actually Alberta) might make on that dilbit today.

  2. If it is such a good idea why are the already connected (at Sumas) Phillips 66 and BP Refineries near Ferndale and the Tesoro and Shell Refineries west of Burlington in Washington State so quiet in this discussion?
    Keep the pipe clean so Kinder Morgan can fill it with water in a few years and import to the US barrels vs Nestle’s current litres at Hope which we may be beyond very soon.

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