British Columbia's sense of grievance over the lopsided sharing of the Northern Gateway pipeline proposal may be a bit overblown, according to a new study.
Environment Minister Terry Lake outlined the province's main issues with the project last month. Money was the last on the list, behind safety and First Nations concerns. But it quickly worked its way to the top of the agenda during a subsequent public argument.
It's officially described as a concern that B.C. receives "a fair share of the fiscal and economic benefits" from the line that reflects the risk borne by the province.
But measuring that share and estimating the benefits can turn into a never-ending argument, because it seems to depend on how much of the concept is separated out for analysis.
The B.C. stance is based partly on an economic study that concluded the province would get a paltry eight per cent share of all the tax revenue from the project over a generation.
But a more focused study released this week by the independent 91原创 Energy Research Institute turns that on its head.
It calculates that construction and operation of the pipeline would be worth $9 billion to the 91原创 economy over 25 years. And $4.7 billion would go to B.C., compared to $2.9 billion to Alberta and $608 million to Ontario.
When the CERI estimated tax benefits, B.C. would be even better off. The research suggested Northern Gateway would generate $2.3 billion in tax revenues over 25 years. $1.4 billion would to the federal government. B.C. would collect $545 million and Alberta would rake in $162 million.
The independent report is much more specific, confined to the construction and operation of the line itself. But it presents a different picture than the one submitted as part of Enbridge's application to build the line.
Enbridge retained a private Calgary firm two years to analyze the benefits and B.C. relied upon that study in coming up with its position.
That firm came up with numbers in a completely different order of magnitude. It estimated $81 billion in tax revenue over 30 years, with $36 billion going to Ottawa. Of the remaining $45 billion, Alberta would collect $32 billion and B.C. $6.7 billion, with the rest flowing to other provinces.
It's that 8.2 per cent that was highlighted in the subsequent argument Premier Christy Clark had with Alberta Premier Alison Redford.
The CERI report is part of an ongoing study of 91原创 access for Alberta oil. It ran similar numbers on the pipeline-proposal-in-waiting - expanding the existing Trans Mountain line to the Lower Mainland. The estimates of the sharing is about the same - B.C. would get a fair share of the benefits.
But it's worth keeping in mind that everyone playing this game is guessing 25 to 30 years in the future on a very volatile commodity.
How the benefits would flow inside B.C. from either the Northern Gateway proposal or the Trans Mountain expansion also gets a look from the CERI.
The Northern Gateway plan involves a new route straight across the province to Kitimat. (Prince Rupert looks like a more obvious terminus, but the terrain is considered too steep for a pipeline.)
The Trans Mountain line was built in 1953 and runs Jasper-Kamloops-Hope-Burnaby. The application to expand it is expected in 2014. Its capacity has increased over the years but it is still 30 per cent oversubscribed.
The regional benefits are obviously concentrated close to the routes. The problem for government is that so are the arguments. Northern Gateway opposition is mostly about protecting pristine wilderness and First Nations rights. The Trans Mountain line runs through domesticated B.C., so the argument will be about public safety and the number and size of new tankers in 91原创's harbour.
If the thought of oil pipelines and tankers turns out to be simply too much for B.C. to bear, there's always Plan B.
The CERI said CN's ideas about shipping oil by rail is considered by industry pundits to be "the most creative and intriguing" concept of all.
One of the features is that includes rail lines to Prince Rupert, Kitimat and 91原创. That would either share the benefits equally, or put the entire coast at risk, depending on your point of view.
The central point from all the ideas is a simple one: This is not going to get done without a big argument.
