Tankers called threat to coastal ‘wealth’
Native group prepares to fight Gateway
Aline of yellow buoys marking the boundaries of a scallop farm outside Prince Rupert, B.C., presents the biggest challenge Enbridge Inc. may face in its bid to connect the oilsands to Asia.
The aboriginal communities on British Columbia’s northern coast, already a port for ships to load grain and coal sent by rail from Canada’s interior, are expanding shellfish farming and ecotourism, says Art Sterritt, executive director of Coastal First Nations. The native group seeks to develop an economy based on renewable resources and has attracted investment from former prime minister Paul Martin and Chinese companies.
Coastal First Nations plans to fight any attempt by Enbridge to bring oil tankers to the area, said Sterritt.
“The real foundation of who we are on the coast is shellfish,” he said from a boat bobbing on 10-foot waves outside Prince Rupert’s harbour. “That’s really what created wealth on the coast.”
Wildlife conservationists and native groups like Coastal First Nations are already preparing legal action to stop Calgary-based Enbridge’s $6 billion Northern Gateway pipeline, potentially delaying it should Enbridge win approval to begin construction. Hearings to determine the environmental impact of the proposed pipeline began this week in Prince Rupert, where regulators were told for the first time about marine concerns. The regulator has until next December to make a recommendation.
The debate pits local groups against one of Canada’s largest companies and what Enbridge says is an effort to help Canada earn more money for its oil, which trades at a discount of $34 to the benchmark U.S. crude.
That makes Northern Gateway a decision about Canada’s economic “prosperity,” said Enbridge executive vicepresident Janet Holder.
“This isn’t about Enbridge,” she said. “This is really about Canada and improving the value of our number one export — oil.”
Enbridge, Canada’s largest pipeline operator, last month reported third-quarter net income of $189 million compared with a loss of $5 million in the year-earlier period, helped by higher volumes on its liquids pipelines and a smaller loss from derivatives contracts.
Enbridge has already heard from opponents further inland along the pipeline route, which stretches almost 1,200 kilometres from west of Edmonton to the port of Kitimat. With a majority of British Columbians against the project, the pipeline operator also faces a backlash from investors, said Vancouver-based fund manager John Clark.
About 57 per cent of British Columbians are opposed to the Northern Gateway project while 53 per cent would “definitely” or “probably” ban oil tankers in coastal waters, according to an online poll of 800 British Columbians by Angus Reid Public Opinion.
“People remember the Exxon Valdez and they remember the pictures of the ducks and the wildlife that were soaked in oil,” said Clark, president of Pacific Spirit Investment Management Inc. “They don’t want to have that in British Columbia’s waters, especially since it’s an area that would be very difficult to clean up once it happens.”
“More and more, the clients are giving me a look and a question, ‘Do we need to hold Enbridge?’ ” Clark said at an energy investment conference in Toronto. He recommends investors hold the stock because of its growth opportunities.
Enbridge has already tried to accommodate concerns expressed by groups in the mountainous central region of the province and may do so again as criticism about the marine shipping plan surfaces in the hearings, said Holder.
“What we have offered so far has been an evolution so we have already made commitments over and above what we would have originally thought of four years ago,” she said. “And we will continue to evolve that as we feel it’s appropriate and as people raise things that we may not have contemplated.”
The company in July said it would spend an additional $500 million to use thicker steel and increase monitoring on the proposed Northern Gateway pipeline in response to criticism about the risks of an oil spill.
Similar kinds of improvements to protect the marine environment are “meaningless” because of the scale of the potential damage from a spill like the 1989 Exxon Valdez, said Brian Falconer marine operations co-ordinator at Raincoast Conservation Foundation.
“It doesn’t matter how many times things don’t go wrong,” he said. “It matters when it does.”
Ocean-based industries currently contribute as much as $1.2 billion to communities along the northern coast where Prince Rupert, with a population of about 12,500 people, is the largest town, according to a study published this week by University of British Columbia researchers Ngaio Hotte and U. Rashid Sumaila.
Paul Martin’s Capital for Aboriginal Prosperity and Entrepreneurship fund invested $5 million in Coastal Shellfish LP, a venture of three aboriginal groups that also has support from China’s Dalian Blossom Group.
Prime Minister Stephen Harper has emphasized the significance of diversifying Canada’s oil exports with Asia, punctuated last week with the approval of CNOOC Ltd.’s takeover of Nexen Energy Inc.
The federal government, including the prime minister and his cabinet, holds the final say on whether the Enbridge pipeline goes ahead or not.