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not all is equal. what choice will you make?

Ethical oil is too important for Clark to play games with

Jamie Ellerton July 26, 2012

Not that long ago, British Columbia was what Canadians refer to as a “have-not province” — that is, it was a net recipient of transfers from other provinces under the country’s equalization formula. It wasn’t a lot compared to what some other provinces received: a half billion dollars a year in 2006/2007, compared to nearly $5 billion for Quebec. But it was something, and it was Alberta that shouldered the heaviest equalization bill to bail out its “have-not” sisters out. Not once in those tougher fiscal years did B.C. refuse the extra help.

Things have changed in B.C. It is, thankfully, today a much healthier province, economically. But with her province’s good fortune, B.C. premier Christy Clark seems to have overlooked the spirit of interprovincial cooperation underpinning the Canadian federation. Alberta wants to bring its oil to overseas markets and requires pipelines that run to tanker ports on B.C.’s coast. Clark, however, is suddenly demanding that Alberta cough up its energy royalties before she’ll let the oil pass.

Yet even Clark herself acknowledges that the proposed Northern Gateway pipeline is “good for Canada.” And it is: the pipeline is expected to pump, in addition to ethical oil headed for markets stuck relying on conflict oil, an additional $81 billion in tax revenue into the Canadian economy. Plus, as federal natural resources minister Joe Oliver has noted, opening markets beyond the U.S. to Canada’s ethical oil will create here at home “hundreds of thousands of new jobs” and “trillions [of dollars] in economic benefits.” All provinces will benefit handsomely from the successful development of the oil sands industry — in jobs and tax transfers — as the Canadian Energy Research Institute has exhaustively detailed; British Columbia will help us all by helping the oil sands — or at the very least not blocking the way.

It’s no secret that Christy Clark’s Liberal party is struggling to connect with voters in advance of an election next May. But playing a dangerous political game with a project of such profound national importance is a seriously misguided maneuver. Especially since virtually all of Clark’s demands are already in the process of being addressed.

Clark has insisted that for B.C. to agree to allow Northern Gateway into its province, it must pass the National Energy Board’s environmental review. But getting a passing grade from Ottawa has always been a precondition for the pipeline proposal to proceed.  She wants Enbridge, the company behind the proposal, to prepare “world-leading” response plans to any spills that might occur on land or sea. Already pipelines are the safest form of oil transportation available, anywhere, but Enbridge is also preparing these response plans, as part of its application to the N.E.B.

Another of Clark’s demands is that Enbridge address the rights claims of First Nations and ensure they, too, benefit from the pipeline project. But again, she’s insisting on something well underway. As it happens, Enbridge reports that 60% of aboriginal groups within 80km of the pipeline route have now agreed to sign on as equity partners in the project, meaning they’re already set to enjoy a share of the revenues from Northern Gateway.

The only demand not already in the process of being addressed is Clark’s new insistence that B.C. get their “fair share.” This explosive political rhetoric was void of details. If she’s referring to oil royalties, they constitutionally belong to Alberta. Michael Percy, the former dean of the University of Alberta’s business school,  warned such a precedent would be “so destructive to Canadian federalism.”

The repercussions of such a bizarre and unheard of arrangement aren’t hard to imagine. Pipelines are, after all, just another mode of transport. If Clark would hold Alberta’s exports ransom in exchange for a cut of royalties, then other provinces could do the same to B.C., commanding, for instance, royalty payoffs for allowing trains or trucks carrying B.C. minerals eastward.

Would Clark really redesign our federation into one where provinces interfere with the mobility of one another’s goods in order to extract maximum kickbacks? That isn’t just a depressing vision for a nation, but an economically destructive one — and this coming from a province that once heartily, and wisely, embraced lowering interprovincial barriers, even signing in 2006 a groundbreaking free-trade deal with Alberta aimed at doing just that.

In fact, B.C. has been home to pipelines from Alberta for years. More than half a century, actually: Since 1953, when Kinder Morgan built its Trans Mountain pipeline to carry crude oil and refined products from Alberta to the coast. Right now, that pipeline is delivering 300,000 barrels of ethical, Canadian oil for export to tankers at the Burrard Inlet — just as oil tankers are right now ferrying up and down B.C.’s coast (despite the fictional claim of a coastal tanker “ban” promoted by anti-oil groups). Kinder Morgan, by the way, has applied to expand the capacity of Trans Mountain to 750,000 barrels a day, and would invest $4.1 billion into the Canadian economy to do it.

That proposal and the Northern Gateway plan are significant opportunities for Canada’s economy. But they also represent a critical step to opening world markets to a new, massive, and ethical source of oil from Canada, further weakening the stranglehold that conflict oil producers like Iran and Saudi Arabia have held over oil importers for decades. The more ethical oil we can get to tankers on Canada’s west coast, the more international buyers can choose our oil — produced in a secure, peaceful, environmentally responsible way and to the highest standards of human rights and workers’ rights — over conflict oil from nations supporting terrorism, war, misogyny and repression. Getting Canada’s ethical oil to market is too important for Canada, and for Canadian values, to let political game-playing stand in the way.

Comments (3)

  1. Richard Murray July 26, 2012 at 12:02

    Premier Clark needs to purge her advisory team and get some smart people in there.
    There is no question that Enbridge, due to their stupidity in reaction to the Kalamazoo breach and others not as harmful, need to be held to a high standard. They seem to me, to be quite lackadaisical in the response to emergencies.
    The demand for revenue for transit of materials through British Columbia, however, is way off mark.
    This situation needs to be taken out of the media glare, with reasonable people on both sides to negotiate a fair deal for all concerned.

  2. The dirty Tarsands bitumen and the diluent has little to no chance of coming through BC. Christy and Alison both, are simply posturing to their base. Christy knew that Alison would not agree to a share of royalties and so Christy is able to say that without that sharing of revenue agreement, the pipeline is a ‘no go’. Now both premiers can save face. John Cummins of the BC Conservative Party has said the pipeline will not go ahead as has Adrian Dix of the BC NDP. This was all an exercise in political posturing and saving face. Neither Alberta nor Enbridge would be responsible for any spills from the tankers from Kitimat, which is another huge concern to British Columbians in our coastal waters. These waters are the fourth most dangerous in the world. Super tankers may be state of the art with double hulling etc. but it is a matter of ‘when’ not ‘if’ a spill would occur. There is absolutely no way to effectively clean a bitumen spill – it sinks, it doesn’t float.

  3. Sure is nice to see such honest reporting! It not one sided, not narrow minded, it must have been inspired by God right!

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