Pipeline official worries about effect of delays

Canada’s image as trading nation at risk, Reicher says

In a world hungry for energy, Canada can be a petroleum powerhouse with its bounty of oil and gas reserves.

But fights over export pipeline approvals could derail that potential while costing the economy billions and tarnishing Canada’s image in the global marketplace, Phillippe Reicher, vice-president of the Canadian Energy Pipeline Association (CEPA), said Thursday.

“I believe over the next two or three years, whatever is going to happen with pipeline approvals (affecting the Keystone XL to Oklahoma, the Northern Gateway to Kitimat and the TransMountain expansion to Vancouver) will have some long-term implications about how we are going to be perceived as a trading nation,” he told the Economics Society of Northern Alberta 2013 outlook conference.

CEPA represents the major pipeline firms that carried 1.2 billion barrels of Canadian oil worth $100 billion last year. In years past, pipelines were generally ignored by the public.

“But now we are seeing people resisting pipelines and it is way beyond pipeline safety, because if I tell you our reliability is 99.998 per cent, which is what it is, that number means nothing to most people,” Reicher said. “Pipelines are the safest way to move oil and gas, but it seems that fact does not convey comfort and trust.”

Opponents of the oilsands who were unable to halt production in Alberta have taken their tactics of exaggeration and fear and applied them to pipelines, he said.

“We are dealing with a very sophisticated campaign and we were unprepared for this,” Reicher added. “People are focused on consequences. On the West Coast they will say the only acceptable pipeline is one that can ensure that there will never be a spill. But we can’t do that; to say so would be intellectually dishonest.”

CEPA hopes educating the public about the wider issues — like pride in building difficult infrastructure projects, which Canadians have done with national railways, the St. Lawrence Seaway and now major pipelines — might help.

Or helping the public understand the brutal economics of losing about $50 million a day and $17 billion a year because Canadian oil that can’t reach tidewater is heavily discounted, might convince some opponents to compromise.

“It would be a historic mistake if this country was unable to take advantage of global markets,” he said.

Tim Quinlan, an economist with major United States bank Wells Fargo, told the conference that shale oil production in the U.S. “could be a game changer” for the struggling American economy.

He said his bank studied counties in Pennsylvania, that had shale-oil drilling and fracking and those that did not.

“We found the shale-oil activity was a boon across the spectrum of employment and really put these parts of the state on a totally different economic trajectory,” he said.