EDMONTON – The Alberta Federation of Labour is worried Imperial’s $8-billion Kearl Lake oilsands project will send most of the bitumen – and good jobs – to the U.S. once the construction is complete.

“Kearl Lake will create a couple of thousand short- to medium-term construction jobs, and in the current economic climate, that’s a welcome thing,” AFL president Gil McGowan said in a release.

“But over the longer term, this project is deeply troubling because it’s focused exclusively on the extraction and export of raw bitumen. The real money – and the real jobs – in this business are in upgrading and refining. Unfortunately Kearl will be sending all of those benefits down the pipeline to Exxon refineries in the U.S. Midwest and Gulf Coast,” he said.

McGowan points to a study released by the AFL in March entitled “Lost Down the Pipeline,” which shows that energy companies are expanding U.S.-based bitumen refining capacity at a furious pace. In the report, the AFL identifies 10 refineries in eight American states that are currently being retooled to process bitumen from Alberta. Once completed, these refineries will have the combined capacity to handle 2.8 million barrels per day – more than double the total current output from the oilsands.

Under provincial regulations, Alberta’s 25 per cent royalty under BRIK (the Bitumen Royalty In Kind program) can be collected in bitumen and resold to local upgraders. But the balance can be exported.

Kearl will produce 110,000 barrels a day when it opens in 2012, and between 300,000 and 345,000 barrels a day when all three phases are in operation.

Up to 3,000 people will be employed during construction, with more than 1,000 permanent jobs created.

Kearl is 70 kilometres north of Fort McMurray.

Edmonton Journal, Wed May 27 2009
Byline: Dave Cooper