Is the Northern Gateway Project In Canada’s National Interest?

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Oil Pipeline Protest

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There has been much controversy surrounding the Northern Gateway Project, a lot of what has to do with the overall environmental impact it will have. Additionally, there has also been a strongly emerging debate as to whether the project is in Canada’s National interest in so far as jobs and economics are concerned. Proponents are claiming that building the pipeline from Alberta’s oil sands to Kitimat, BC where the oil will be shipped to China and the Asian markets via supertankers will create thousands of sustainable jobs along with billions in revenues well into the future. Nevertheless, opponents counter that Canada should first supply our domestic needs before increasing oil supplies to Asian markets which will inevitably result in local oil refineries not being able to compete with higher Asian bids on the open market. Local oil refineries such as Burnaby BC’s Cheveron Refinery that employs 250 workers is very concerned about this as their current supply from the Alberta oilsands will be threatened.

Robyn Allen a former CEO of the Insurance Corporation of British Columbia states,

“[there will be] a negative prolonged impact on the Canadian economy by reducing output, employment labor income, and government revenues.”

Enbridge, the company behind the 5.5 billion proposed Gateway Project has forecasted a $2-$3 annual increase per barrel in its application to the National Energy Board, something in which Allen claims that ,

“when the price of oil rises, that means consumers and businesses will pay more for anything produced by that oil. That will result in inflation, businesses being downsized and employees being laid off.”

Brian Lee Crowly, the managing director of the MacDonald-Laurier Institute, an independent non-partisan public policy think tank in Ottawa sees things differently. He claims that while on the surface it would make sense to create more jobs in processing oil before we export it, he points out that trying to do so would actually end up costing more in regards to having to compete with places like Jamnagar, India, who would be able to build a new refinery for $6 billion and have “a supply of workers and regulatory environment we can not duplicate.” A comparable new refinery in Canada would cost between $7-8 billion and will most likely face opposition that will become costly and stall our production output. Crowly doesn’t think it makes economic sense to even try, as building regulations and higher labor costs will not justify the potential revenues generated by processing the oil. Nevertheless, he did state,

“we could upgrade and refine some of our production facilities in the east (at Irving refinery in St. John for example) but they are already well supplied by world oil markets, whereas getting large quantities of Alberta crude to them would be costly for little benefit.”

Perhaps it is not in our national interest to have oil supplied to other areas in Canada to be processed in either new or upgraded refineries, however, it would be in our interests to utilize existing refineries such as Burnaby Cheveron that have the capacity to refine oil as well as potentially subsidize our domestic supply to allow our refineries to serve our domestic needs so that they do not close down. Nevertheless, it would mean that the Conservative Government must do what is right for Canadians and not export oil to the extent where our domestic needs are being sacrificed to the higher bids of the Asian market because this would only serve the interests of individuals who at the end of the day are using Canadian owned oil. If these individuals want more money they should get overseas permits in other oil rich nations and use their supplies to provide whoever they want and stop being greedy of wanting oil that belongs to the people and not a few groups who stand to significantly benefit by the pipeline at the expense of everyone else.

  • Samir Goel

    Samir is a freelance writer who lives in Delta, BC and who enjoys spending time with his family and friends. He is very happy to be able to talk about green initiatives and enjoys his time posting at greener ideal.

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