Economist Robyn Allan is speaking in Burnaby this month about the economics behind major pipeline proposals, including Kinder Morgan's plan to twin the Trans Mountain line that runs through the city.
According to Allan, who's reviewed information from Kinder Morgan and Enbridge, the industry's plan to ship raw bitumen to foreign markets will drive up the domestic cost of oil while reducing the number of value-added jobs.
"This is not a program that's going to have economic benefits. It's going to have economic costs," Allan said. "Oil sands producers in Canada want to get our oil to Asia so they can charge us that higher price on every barrel, ... higher than it would be if we are following a strategy that would upgrade the oil in Canada and ship it to Eastern Canada."
In 2011, the Canadian Energy Pipeline Association's member companies provided 8,000 full-time jobs in Canada and collectively paid more than $500 million in property taxes. According to the association, the pipeline industry will invest more than $22 billion in pipeline projects over the next five years, expanding networks to access Asian markets.
But according to Allan, Canadians will face higher costs for oil and greater environmental risks so that oil producers can ship the country's raw resources abroad.
"We're being given a benefits case that is slanted towards the benefits to companies," she said.
Allan, a former CEO with ICBC, is an economist who's worked in the public and private sectors. She was also an expert witness in hearings for Enbridge's Northern Gateway proposal.
Allan became an outspoken critic of the oil industry's plan to expand pipelines through B.C. after a conversation with her son piqued her interest.
"As I started to explore the documents, I was shocked at how the analysis was slanted towards one story and one message, and the benefits were exaggerated, and it's a bogus economics case," she said.
According the Allan, multinationals decided to export raw bitumen and forgo value-added benefits in 2008, when the global financial crisis hit.
"You're hollowing out the resiliency of the oil sector," she said. "These pipelines, whether it's Kinder Morgan, Northern Gateway or Keystone XL, they represent a cannibalization of our oil sector."
Exporting raw resources and losing value-added job will raise the value of the Canadian dollar, which will put a strain on every sector that relies on exporting, she added. Allan said she would like to see the oil sands developed in a way that benefits Canada without threatening the environment or crowding out legitimate economic activity in British Columbia.
According to Allan, Canada will not have a strengthened oil sector to fall back on when prices fluctuate in volatile international markets.
Allan's talk is on Wednesday, March 27, at Confederation Seniors Centre, at 4585 Albert St. Doors open at 6:30 p.m., seating is limited and admission is free. Allan's presentation will be hosted by a number of groups: the SFU's Institute for the Humanities, Unitarian Church of Vancouver's environment committee, ForestEthics Advocacy, and Burnaby Residents Opposed to Kinder Morgan Expansion.
