Investment and Jobs
The proposed refinery will be the largest refinery on the west coast of North America and amongst the largest in the world. The refinery will be one of the largest single investments in the history of the country.
The refinery project will create 6,000 construction jobs in BC for five years.
The refinery will result in more permanent jobs than any project has ever created in BC. It will create approximately 1,250 full time equivalent direct jobs at the refinery with another 1,250 full time contract jobs to support the operations and maintenance. These will be skilled high value permanent jobs. These jobs will be required for the life of the refinery which should be in excess of 50 years.
Additional factories spring up beside all refineries to make use of by-products and chemical streams. Typically for each refinery job there is a second petrochemical job created nearby. Therefore there could well be another 2,500 petrochemical jobs created in the valley. These direct jobs will create thousands of indirect jobs in the area.
New Wealth and Taxation
There will be billions of dollars each year in economic spinoffs. The resulting taxes will help reduce government deficits and provide funds for social purposes.
A great deal of money will be generated each year for BC First Nations.
Creating a Market for BC and Canadian Resources
The refinery will be a large consumer of BC’s surplus natural gas, which will help BC’s economy in the northeast. At 660 million cubic feet per day, the consumption will be three-quarters of the amount proposed to be exported by the Apache Chevron Kitimat LNG plant.
The refinery will also consume 400,000 barrels per day of bitumen from Alberta that is in danger of being landlocked. This in itself is obviously useful, but changing the North American supply/demand situation will have the additional positive effect of moderating the $25 billion per year of existing sales discounts on all Canadian oil exported to US refineries, freeing up more profit for business and more income tax for governments.
Since the bitumen will all be refined prior to export, any risk of a supertanker spill of bitumen will be eliminated. Shipping gasoline, jet fuel, and diesel is much safer from an environmental point of view, since, while still toxic, these fuels all float and evaporate easily. Often little or no remediation is required. Oil, bitumen and diluted bitumen on the other hand are a huge risk. Once spilled, dilbit and bitumen set up like tar and are not affected by rain or surf. They coat the shore and after mixing with sediment can sink to the bottom of the ocean. We cannot clean them up adequately.
In addition the Kitimat refinery will use Fischer Tropsch (FT) technology and produce only two-thirds the CO2 greenhouse gas emissions of a refinery built in Asia, which would be a coking refinery. This refinery must be built somewhere. If it is built in Kitimat Canada the world’s environment will benefit.
Note that the Fischer Tropsch refinery CO2 saving is so substantial, it neutralizes the extra CO2 used in the oilsands for extraction. The implications of this to Alberta and Canada are significant. Even excluding all the CO2 emitted when coke is subsequently burnt to produce power, the wells-to-wheels CO2 emissions from oilsands bitumen when a coking refinery is involved are 114 grams per megajoule of gasoline (Jacobs study). The wells-to-wheels emissions when a FT refinery is used are 102 grams per megajoule of gasoline. According to Jacobs this is less than the wells-to-wheels emissions from the conventional oil in Iraq and Nigeria. Oil sands bitumen will no longer be labelled ‘dirty oil’ if it is refined at an FT refinery.
If inexpensive natural gas is available, all similar heavy oil plants, which produce refined fuels, should use FT technology in the future. This is a new patented Canadian process. It is carbon-efficient and economically efficient. The planet will be better off if it is used in place of coking units which generate large amounts of sulphurous coke as a byproduct. We will showcase the technology and prove its worth, encouraging others to adopt it.
Sidestepping Political Extremism
The BC public doesn’t want to see bitumen in tankers. It does want economic benefits from any pipeline project for BC. It also wants safe and green environmental practices.
Some opposition groups say they are against all tankers. Most people know that is impossible. Local First Nations on the Pacific coast and other local communities and fishing lobbyists recognize the difference between carrying oil or bitumen and refined fuels. They are used to the water delivery of gas and diesel to their villages and camps. But they are completely against bitumen shipments and say they will go to court to prevent them. Many other outspoken people say that they will do whatever it takes to prevent the shipment of bitumen. They look back with pride on public demonstrations in Clayoquot Sound which prevented logging there.
It makes sense for government to favour projects that avoid bitumen in tankers if possible. To do otherwise courts civil disobedience which is in no one’s interest.
This refinery project provides for a sensible political middle course. It allows for the development and export of natural resources while avoiding the tanker issue that most concerns the public.
KC’s proposed refinery is the only commercially viable approach to get Alberta oil sands product to the Pacific that is popular in BC.
A Positive Role for Governments
The public will give governments credit for helping to develop the KC project. It resonates on many fronts:
- building investment and jobs in Canada
- creating new wealth and taxation within the country
- helping First Nations
- getting shut-in natural gas and landlocked Canadian oil to the market
- keeping oil and dilbit out of tankers
- cutting refinery CO2 emissions by two-thirds
- promoting world-wide use of Canadian carbon-efficient Fischer Tropsch technology
- finding common political ground and avoiding possible civil disobedience
KC will approach the Federal government for an interest bearing loan guarantee of $10 billion. This is in line with precedents when a project is deemed to be in the national interest. For example, a loan guarantee of $6.6 billion was granted to the Muskrat Falls hydro project in Newfoundland recently. In another case, to jumpstart the Hibernia project, Canada provided a $1 billion grant as well as loan guarantees.