“There are times when governments have to give industry a helping push.”
That according to former New Brunswick premier Frank McKenna, during a
conference in Sarnia, Ont., aimed at making sure the rest of Canada
gets a piece of the economic pie from the oil sands development.
The Bitumen: Added Value conference drew about 150 industry leaders
from Sarnia-Lambton, Ontario and Alberta to talk about how the country
can not only pull the thick bitumen from the ground and export it to the
US but to refine it here, bringing more jobs to Canada. “Theoretically,
we could lead the world in growth if we could just get this off the
launch pad,” McKenna told the group.
McKenna said the TD Bank Group, of which he is the deputy chair,
estimates Canada is losing between $25 and $30 billion each year by
failing to upgrade the bitumen in this country.
Jim Stanford, the Canadian Auto Workers chief economist, said, “You
don’t have to be a PhD in economics to see there is a potential problem
there…Canada’s over-reliance on a staples economy has been with us since
Stanford said the resource needs careful development. “We need to
actively manage the resource wealth to increase its benefits…we have to
be cautious of how it is developed and abandon the Gold Rush effect,” he
said, adding it drives up costs.
Stanford said the federal government needs to take a key role in that
by creating a national energy policy — a term most politicians shy away
from since it still holds bad connotations from Pierre Trudeau’s
National Energy Policy in the 1980s. But he believes that is changing.
“I think the federal government realizes the limitations of a
reliance on raw bitumen exports; they’re open to an alternative vision
of added value in Canada.” McKenna said the federal government has to get behind the industry and offer financial help to make refinery projects feasible.
Clem Bowman, founder of the Bowman Center for Technology
Commercialization, agrees. He noted that Prime Minister Stephen Harper
said in 2006 that Canada would be an Energy Superpower. But he says the
federal government needs to inject cash into the industry just as
governments in the past supported visionary projects like the St.
Lawrence Seaway and the national railway.
“The risk is high for visionaries to take,” said Bowman, adding the
politics of that risk is part of the reason the federal government has
yet to provide support to build upgrading facilities. “Someone has to
put up some upfront money at the start.”
Stanford said the federal government could increase the wealth
generated by the oil sands by insisting on Canadian content rules. “We
have wasted the opportunity to use Canadian equipment,” he said. “We
have obviously wasted the opportunity to add value to bitumen.”
Stanford added federal and provincial governments need to work
together to grow the wealth and hold the petroleum industry accountable
on its costs, including its costs to the environment.”
McKenna said simply moving the bitumen to the East Coast would be a
good start. “Pipelines are perhaps the clearest value-add to build,” he
said. “They provide lower priced commodities and allow for larger
profits.” McKenna added pipelines “allow companies access to more
competitive markets and that makes industry more valuable.”
— HEATHER WRIGHT, Sun Media News Services
About 50 people joined a protest on the steps of Sarnia City Hall Tuesday opposing Enbridge's Line 9 Project. The company plans to use an existing pipeline to carry diluted bitumen from the Alberta tar sands, through Sarnia to Eastern Canada.