A University of Ottawa academic is urging Canada’s oil and gas producers to burnish their domestic image by refining tar sands/oil sands bitumen into value-added products at home before it is exported.
In a post on iPolitics, Robert Hage, a senior fellow at the U of O’s Graduate School of Public and International Affairs, points to the limited economic benefit of export pipelines as one of the arguments commonly raised against the industry’s determination to transport its raw product to tidewater.
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Some First Nations, in particular, might be less inclined to oppose proposals like Enbridge’s currently-moribund Northern Gateway pipeline, Hage speculates, if those communities saw a prospect of significant economic gain from the product they carry being refined on Canadian soil.
“What if the chief of the Haisla Nation in Kitimat, B.C., where Enbridge proposes to locate its pipeline terminal, said he is opposed to shipping bitumen — but would consider a proposal to refine bitumen in Kitimat before shipment?” Hage asks. The coastal B.C. nation, he adds, has been “eager to lease their Kitimat land for an LNG tanker terminal, and the jobs and revenue that would come with it.” Other First Nations have also signalled a willingness to consider pipeline proposals married to commitments to domestic refining.
Support from producers and shippers for domestic refining—something the industry has shunned, he says, because of its relatively low profit margins—might also disarm resistance from the federal Green Party, Hage suggests. He notes that the party’s platform only opposes “pipelines of unprocessed product to either coastline.”
Energy workers testified before the National Energy Board during hearings on Enbridge’s Northern Gateway application that “refining the bitumen before shipping it overseas could create an estimated 26,000 jobs in Canada,” Hage says.
“Two entrepreneurs,” he adds, “are advancing billion-dollar refining proposals for Alberta’s crude at either Kitimat or Prince Rupert.” Endorsing one of those plans might be a way for pipeline proponents or the Alberta government to change the terms of the national debate.
