Conditions placed on approval won’t stop pipeline from shipping high-value jobs overseas

Edmonton – Despite the evidence that the Northern Gateway will be detrimental to the interests of Canadians, the National Energy Board’s Joint Review Panel has given the go-ahead for a pipeline that will transport hundreds of thousands of barrels of raw bitumen to refineries in China every day.

The approval, which places more than 200 caveats and conditions on the pipeline, was announced on Thursday. The province’s labour movement, which has provided research and evidence throughout the debate over the pipeline, took aim at the decision.

“This is a decision that Canadians will come to regret, and it’s a decision that ignores the evidence,” Alberta Federation of Labour president Gil McGowan said. “They’ve placed more than 200 conditions on this approval, but none of those caveats change the fact that this pipeline will siphon jobs out of Alberta, out of Canada and out of North America. It’s a monstrous bitumen superhighway which will send thousands of high-paying jobs in upgrading and refining out of the country. Instead of those jobs being created Fort McMurray or Fort Saskatchewan, they’ll be created in Shanghai or Bejing.”

McGowan vowed that the Alberta Federation of Labour will support First Nations and environmental groups that will almost certainly continue to fight against the pipeline.

The AFL has shown that pipeline project will only create 228 permanent jobs, and barely 1,500 short-term construction jobs. Meanwhile, more than 26,000 long-term high-value upgrading jobs will be farmed out to low-wage jurisdictions overseas.

The AFL has spent more than two years examining the Northern Gateway pipeline, sifting through evidence and participating in cross-examination on the economic benefits of the project. According to the research presented by the Federation, shipping an unrefined product overseas will be detrimental to existing upgrading in Canada, and will further undermine the pricing of Canadian natural resources. The pipeline will drive up costs for Canadian upgraders by more than $800 million dollars.

Other evidence submitted by the AFL and various experts shows that:

• Canada only captures about 35 per cent of the potential value of bitumen when it’s shipped raw, compared to 75 per cent of the value when it’s upgraded to Synthetic Crude (SCO) before being exported

• With the construction of new bitumen export pipelines like Northern Gateway, the Alberta government’s own studies show that the per centage of bitumen upgraded in Canada will collapse to as little as 23 per cent, compared to the 65 per cent that has traditionally been upgraded in the country.

“Governments at all levels pay lip service to wanting to keep good jobs in Canada, but they always end up putting the narrow interests of big energy corporations ahead of the broader public interests of Canadians,” McGowan said, adding this is this is the AFL’s fourth intervention against raw bitumen exports in recent years.

McGowan said he was pleased the review panel at least acknowledged that the AFL and the Communication Energy Paperworkers union (CEP) had raised “valid public interest considerations” in the arguments they made about lost Canadian jobs. But he was “disappointed and frustrated” by panel’s conclusion that private energy companies would build more upgraders and refineries in Canada if it was economic to do so.

“The panel is ignoring the fact that governments in both the U.S. and China heavily subsidize their refining industries. That’s why they’ve decided to rip and ship our resources and send them to refineries in their home countries. Given that these are resources owned by the Canadian public, the question that Canadians should be asking themselves is this: does it make sense for us to let other countries keep the jobs for themselves and leave us with the pollution and a few economic crumbs from the table?”

McGowan said the panel report demonstrates the need for a clear national energy strategy that puts the needs and interests of the Canadian public first.

“We shouldn’t expect bureaucrats like those who worked on the review panel to stand up to big oil companies,” McGowan said. “They can’t and they won’t. What we need, instead, are politicians with courage; politicians who remember that they work for Canadians citizens, not multi-national oil companies. More specifically, we need a made-in-Canada energy strategy that puts a priority on long-term job creation for Canadians and energy security for Canada. Every other energy-producing country in the world, including the U.S., has a strategy to protect and promote their own domestic interests. It’s time for our politicians to get their heads out of the oil sands, pardon the pun, and start standing up for Canadians, instead of caving in to the Exxons and Sinopecs of the world.”

For a particularly thoughtful analysis of the Northern Gateway debate, please watch the video recently prepared by independent economist Robyn Allan, who appeared as an expert witness for the AFL during the joint panel hearings. The video can be found at this address: http://www.robynallan.com/2013/12/09/pipelines-and-oil-tankers/

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MEDIA CONTACT:

Gil McGowan, President, Alberta Federation of Labour at 780-218-9888 (cell)

Olav Rokne, Communications Director, Alberta Federation of Labour at 780.289.6528 (cell) or via e-mail orokne@afl.org