Sun 24 Feb 2008
Premier Ed Stelmach was lambasted Saturday for failing to stem the
flow of oilsands to the United States after regulatory approval was
given to another pipeline project that will ship Alberta bitumen
stateside.
“The Tories shrugged their shoulders and they’re
letting Albertans’ wealth go south of the border,” Alberta Liberal
Leader Kevin Taft said Saturday in Wainwright.
“They just let it go, and it’s a huge strategic opportunity (lost) for Alberta.”
On Friday, the National Energy Board approved the $3-billion Alberta
Clipper pipeline, which will initially ship up to 450,000 barrels of
bitumen a day out of Alberta to Wisconsin when it becomes operational
in mid-2010. The pipeline could accommodate up to 800,000 barrels a day
in the future.
The 1,600-kilometre Clipper pipeline is one of
several projects announced or approved in the past year that will see
oilsands upgraded or refined in the U.S., sending potentially billions
of investment dollars and thousands of value-added jobs down the
pipeline with the gooey, tar-like sands.
“It won’t be just raw
bitumen going down those pipelines — we’ll also be losing thousands of
high-paying upgrader and refinery jobs,” said Gil McGowan, president of
the Alberta Federation of Labour.
Stelmach has vowed since the
2006 Progressive Conservative leadership race that he’ll curb that
trend. He has compared the flow of bitumen and jobs to “scraping off
the top soil” from prime farmland.
But he has yet to implement any major proposals to achieve that end.
Campaigning
Saturday through resource-dependent regions in west-central Alberta,
Stelmach maintained he’s still committed to creating more value-added
jobs, but won’t force companies to follow his wishes.
He said
Alberta will continue to upgrade 60 to 65 per cent of its bitumen, as
oilsands development and processing grows in the future.
“It’s
one thing to say that we’re going to use a stick, but we have to
carefully look at what (free-trade) agreements we have in place,”
Stelmach told reporters in Hinton.
“We have to be very careful
how we proceed. The main thing is, we have to bring our costs down, and
that is by getting more tradespeople, and providing the housing and
infrastructure.”
Costs and growth pressures are slowing the
development of oilsands processing plants in Alberta and contributing
to more and more bitumen being exported, he added.
Stelmach has
previously suggested the bitumen processed in Alberta will rise to 72
per cent by 2016, spurred by new upgraders and the government’s
value-added plans, which are still in the works. The Tory leader has
also said it’s foolish to force energy companies to upgrade all their
bitumen in Alberta because it would sink the price of the product.
Alberta
produces about 1.3 million barrels of bitumen a day, with about 800,000
barrels, or 62 per cent, staying in Alberta and 500,000 barrels being
upgraded outside Canada.
Taft said the Conservatives have dropped
the ball by failing to bring in a comprehensive value-added policy that
would keep the jobs and oilsands in Alberta. He’d like to see bitumen
upgraded in Alberta, but said there’s benefit to shipping some of the
oilsands to other provinces, rather than losing it to the U.S.
But Greg Stringham, vice-president with Canadian Association of
Petroleum Producers, noted Albertans are receiving great benefits from
the oilsands processing already occurring in the province.
He
suggested the percentage of total bitumen processed in Alberta could
rise to more than 70 per cent by 2015, as the upgrading capacity comes
in line with oilsands development — about 3.5 million barrels per day.
“We’re
already getting great value here with the upgrading,” Stringham said.
“It’s going to come along with the oilsands development.”
Political observers, meanwhile, said the timing of the Clipper
pipeline announcement is like a slap in the face to Stelmach because
he’s been so public about the issue.
It shows the Tory leader
hasn’t been able to persuade big oil and gas companies to follow his
wishes, said David Taras, political analyst at the University of
Calgary.
“This was high on the hit parade during the leadership
race and now it seems to be a forgotten policy,” said Taras, suggesting
the energy board’s decision is another speed bump in Stelmach’s
campaign.
“One after another it’s become a nightmare campaign in
which almost two or three times a week there’s a shock to the campaign
and it always seems to be bad news.”
NDP Leader Brain Mason and
labour groups immediately went on the offensive, arguing Stelmach is
breaking one of his biggest political promises by sitting on his hands
while new pipelines are built to export an Alberta product.
The
National Energy Board has approved $10.4 billion in new international
oilsands delivery routes since September 2007, including the
$5.2-billion Keystone Pipeline by TransCanada PipeLines; the $3-billion
Alberta Clipper and the $2.2-billion Southern Lights projects, both by
Enbridge Inc.
The Keystone project alone will export 18,000 jobs
to the U.S., predicts a consultants’ report done for the federation
when it unsuccessfully fought the proposal at NEB hearings.
Among
major participants in the emerging international oilsands network,
EnCana Corp. ships bitumen to ConocoPhillips refineries in Texas and
Illinois.
Husky Energy scrapped a planned $2.3-billion addition
to its Lloydminster heavy-crude upgrader and will ship its bitumen to a
BP refinery in Ohio. Marathon Oil is expanding a Detroit plant to
handle newly acquired Fort McMurray production.
Jason Fekete, Gordon Jaremko,
Calgary Herald; Edmonton Journal; With files from Heath McCoy, Calgary Herald; and Archie McLean, Journal staff
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