Pipeline will spill profits
Shipping crude to China via B.C. fetches higher price
Oil executive Brian Ferguson isn’t taking sides on the means by which crude from the Alberta oilsands is transported across B.C. for shipping to the lucrative Asian market.
The chief executive officer of oilsands producer Cenovus Energy Inc., who paid a visit Wednesday to the editorial board of The Province, is supportive of the controversial Northern Gateway pipeline proposal being pushed by Enbridge but he’s also willing to ship his product in the Trans Mountain pipeline if it doubles its capacity.
Environmentalists and First Nations are rallying against the Northern Gateway, fearing the ecological horror of a pipeline leak or a tanker spill.
Ferguson just wants to be able to ship more crude oil from northern Alberta to a port in B.C. where his company can get a price currently $20 a barrel higher than if shipped to the U.S.
His company profits rise but B.C. and Canada also reap the benefits.
“Do you want a growing economy or not?” he said.
“If the industry makes money, it means the industry is producing more energy, which means that all of us benefit because there’s more tax revenue, there’s more job creation,” said Ferguson.
He contended that 5,500 permanent jobs are created for every additional 35,000 barrels a day that Cenovus can ship.
That doesn’t include construction jobs associated with expansion.
Unlike the surface mining of oilsands, which has earned a black reputation with environmentalists, Cenovus pumps steam from saline groundwater sources into underground deposits.
The steam softens the bitumen, which is pumped to the surface and cleaned.
More than 90 per cent of the water used is recycled and Cenovus is working on improving its methods — saving money at the same time as reducing environmental impact.
Ferguson admits a barrel of Cenovus’ oil doesn’t have the lowest greenhouse gas emissions to produce but it’s not as bad as portrayed in some quarters.
“That barrel of oil is essentially no different that any other barrel that is consumed anywhere in the world,” he said.
There’s no shortage of that oil in Alberta because the oilsands represent the third largest oil resource on the planet.
What’s not competitive is that most of it shipped to the U.S. through the existing pipeline — although Cenovus sent its first shipment of crude oil, about 250,000 barrels, to energy-hungry China earlier this month.
Kinder Morgan Energy Partners has begun design work on a $3.8 billion project to double the capacity of its existing Trans Mount pipeline from Alberta to Vancouver, from its current 300,000 barrels per day.
If the project goes ahead, it should be complete by 2017.
The Northern Gateway project, which could ship 525,000 barrels per day, is currently going through a tortuous approval process.
Also scheduled to be complete by 2017, it was initially proposed to terminate at the deep-water port of Kitimat.
But there has also been discussions of moving the pipeline to the more sheltered harbour of Prince Rupert.
No matter where the pipeline winds up, it’s created a storm around the northern coast of B.C. The downtown core of Prince Rupert had to be shut down Feb. 4 when more than 1,000 protesters took to the street in opposition to Northern Gateway.
Public hearings and the federal review of Northern Gateway is expected to last until 2013.