It’s been a day since the National Energy Board recommended approval of the Northern Gateway pipeline, and some of the people who otherwise distrust government, want it out of the economy, and hate quasi-judicial independent appointed bla bla bla — are lining up to praise the probity and wisdom of the Joint Review Panel. Some of these folks are your friends and relatives. Some have a wider audience.
The words of the pro-pipeline press are worth reading today, because they point to both the true debate and the false debates that we will face going forward. Indeed, some of these conversations might come up over the holidays. If so, let’s make sure we don’t get lost in rhetorical cul-de-sacs.
For example, in a Toronto Sun editorial titled “Northern Gateway? Get on with it” we are told the “job of government” (executed to applause here by the JRP) is “to stand up to political pressure from green luddites, whose real agenda is to sell us on the idiotic idea of sabotaging our own economy. And to get us to buy their snake-oil claims that wind and solar power are capable of powering a modern, industrialized economy, which is nonsense.”
Fin. Mic drop.
1. The pipeline debate has nothing to do with where Canadians get their energy. That’s a completely separate conversation. Nobody is talking here about wind or solar — or burning snake-oil, which would be an interesting, if labour-intensive, bio-fuel. The bitumen in these pipelines will never heat your home or end up in your gas tank. These projects are purely for export.
2. The whole point is for bitumen producers to sell their product at higher prices. Right now the only customers for Alberta heavy crude are in the US, which is in the middle of its own oil-drilling boom and has no interest in our low-grade stuff unless it’s cheap. Refineries in Asia are in a different position. Supply is tighter (for now) and demand is higher (for now) so they’re willing to pay more (for now), if someone can get the product to them.
3. We can’t really say who stands to benefit. In the case of Northern Gateway, we don’t even know who all the investors are. We know China’s three giant state-owned oil companies are involved: Sinopec is a partner, PetroChina is bidding on construction, and CNOOC bought Nexen, which owns a 10% chunk of shipping capacity. Other confirmed shippers include France’s Total SA and Calgary-based Cenovus, Suncor, and MEG Energy. But four of the 10 shippers remain a mystery.
It’s worth keeping in mind that oil sands operations are 71% foreign-owned. Certainly the pipelines would generate a certain amount of revenue for government. And hopefully some of the profits would be reinvested in economic development that would benefit all Canadians. But nowhere is that guaranteed. This brings us to the real debate, which is about risk versus reward. Here I’ll quote Peter Foster, a columnist in the Financial Post, because he hits the nail right on the head:
“All wealth- and job-creating development involves risks. The point is that they should be acceptable, and accepted by those who might have to bear the consequences.”
Did you hear that, BC? A guy says you should accept the risk and bear the consequences. After all, this is what the Joint Review Panel said yesterday: “After weighing the evidence, we concluded that Canada and Canadians would be better off with the Enbridge Northern Gateway project”. And you know, in a way they’re right. If you set aside certain evidence and limit the scope of your inquiry, you could always find the nation-wide risk/reward ratio to be favourable, especially if a project mostly jeopardizes one province’s jobs, communities, and ecosystems.
You know what else? You could argue that Canada and Canadians, on average, would be better off if people in Quebec would just speak English. Or if people on PEI would give up on their tiny, ridiculous province. You could say it would make life easier if people on reserves would just move to the city and assimilate. But that’s not how our country works.
If British Columbians and First Nations along the path of these pipelines decide that for us, the risks outweigh the rewards, then too bad. The decision is not up to newspaper columnists in Calgary or Toronto.
4. Where you are, and who you are, will determine whether those risks are acceptable. Some people face more risk. Some people anticipate greater rewards. If you’re a company that has signed a shipping agreement with a pipeline that will let you sell every $60 barrel of oil for $90, then heck yes, the reward outweighs the risk. If you live east of the Rockies, any benefit is going to sound better than zero risk. If you’re the BC government, Enbridge promises to pay $1.2 billion in taxes over the next 30 years. So, forty million bucks a year, which adds up to $9.09 per person. Which starts to sound pathetic. And if your home, culture, food, job, health or climate is on the line, there might not be a price at which the monetary rewards outweigh the risks. You’re allowed to say that.
5. These pipelines are not charity projects. Even if your land straddles a pipeline route and you’re being offered straight cash, that amount of money is still less than it would cost them to go around you. Benefits offered by the proponent only increase their potential profit. If you’re a member of a First Nations band and your community is offered equity, great. If you’re a citizen of Canada and your government will receive taxes, royalties, and spinoffs, great. They might misplace or misspend the money, but hopefully some of it makes your life better. Just know that whatever numbers they flash, those of us standing between the producers and the customers will never be the big winners.
6. Each proposal will die the day it is no longer profitable. There are three ways this could happen: markets, laws, or physical opposition. This is where we come to a discussion of tactics. If you don’t think the risks of Northern Gateway or the Trans Mountain pipeline are worth the reward, then you have some options as a citizen. You can mutter darkly about bulldozers and tear gas. That’s certainly your right. You could also look at global energy markets and transport proposals and prices and timelines, then read up on economics and think about how those logical constraints might be leveraged and when. Or you could look at what those sex workers accomplished today in Ottawa, then read up on Supreme Court jurisprudence and think about how previous challenges and decisions might apply to this situation.
Whatever you do, I hope you don’t give up on representative democracy and the idea that we elect people to stand up for our local interests, even if sometimes we have to work pretty hard to hold them to it. Some politicians are already saying the right things. A few need reminding.
Let’s set aside the JRP decision and the pipeline ads and the national newspapers for a minute. What would you want to say to your local representative about risk and reward, and what questions would you have for them? Feel free to practice over turkey.