Comment: When oil is landlocked, so is prosperity


Imagine if Brian Epstein had never seen the Beatles. If John, Paul, George and Ringo had continued to play “undiscovered” in the Cavern Club, how many people would have heard them; what would their estates and copyrights be worth today?

Hard to imagine. Such squandering of natural gifts.

It’s not a lot different, when you think of it, for Canada’s natural resources. And squandering, in effect, is what we’re doing today with the economic potential of our oil resources. They are effectively landlocked due to the inability to get the barrels to seaport and a broader market. Alberta’s oil is locked to North America, especially U.S. distribution, which cuts the per-barrel price by about $14, as of August, when Alberta crude was selling for about $31 a barrel.

Without pipeline access to tidewater — and therefore to new international markets — Canada will continue to pay an economic penalty.

No one is saying this country, or its producers, should build pipelines without diligent consideration and mitigation of environmental impacts — protecting sensitive or at-risk territories, waterways and species. That’s not the Canadian way.

Recent approvals — the $36-billion Pacific Northwest LNG project, for example — should give all Canadians, including those whose communities and traditional lands are most directly affected, some comfort in the environmental review and vetting process. The Trudeau government recently gave the LNG project the green light, subject to 190 conditions.

The careful, public environmental review (combined with regulated monitoring and reporting during project development, construction and lifetime operation) illustrates the value Canadians place on their land, water and communities, and the respect for the constitutional rights of indigenous people.

But landlocking the country’s natural wealth is beyond misguided. It wastes Canada’s potential to realize economic growth and security — the lifeblood of our governments’ treasuries, revenues that support the social programs that make our standard of living the envy of the world.

It also stymies the development of the best human talent in science, engineering and industrial innovation. Why would we turn our backs on our youth, send them packing for careers elsewhere?

What, in hard numbers, are we “turning our backs” on? Here’s some idea:

• According to a 2015 Conference Board of Canada report, the $6.8-billion Trans Mountain pipeline expansion holds 678,000 person-years of employment.

• The Energy East pipeline would be worth $16.8 billion in GDP for the Canadian economy during the nine-year development and construction phase alone.

• Enbridge says its $7.9-billion Northern Gateway pipeline project would create as many as 3,000 jobs during peak construction.

Long-term employment connected to the three projects would be more than 38,000 total jobs per year.

I’m from Manitoba, a province that at first blush might not seem to have much skin in the game. But that’s entirely the wrong way to look at our country’s collective wealth and potential. All provinces, all Canadians, benefit from careful stewardship of our natural resources, which includes developing them in a responsible, rational and sustainable way.

This is important to the West, and to all Canada. Pipelines, as with all strategic infrastructure investments, are key to the country’s economic prosperity. They, like road, rail and marine assets, deserve to be supported through careful and wise public policy. They are what Prime Minister Justin Trudeau refers to when he talks about “nation-building” projects in his government’s infrastructure-investment plan.

These projects are the foundation for future wealth-generation to support jobs, good incomes and strong communities. They provide the silk for the fabric of our social-welfare programs.

Chris Lorenc is president of the Western Canada Roadbuilders & Heavy Construction Association and president of the Manitoba Heavy Construction Association.

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