Saturday April 19, 2014

Investment offers benefits

There was much talk last week of compensation after B.C. Premier Christy Clark and
Alberta Premier Alison Redford agreed that Victoria will keep its hands out of the pocketbook of its eastern neighbour.

Although the agreement was much ado about nothing — Ottawa, after all, has the final say on pipeline projects, including Enbridge’s Northern Gateway proposal — it offered a hint at how B.C. hopes to be compensated for pipelines carrying oil from Alberta to the coast.

Now that the ridiculous and unprecedented prospect of dipping into Alberta’s oil royalties is off the table, Clark suggested an oil-refinery project, pipeline tolls and even federal revenues as possible avenues for B.C. to get its “fair share” of economic benefits. Those benefits are a part of Clark’s five conditions to gain B.C.’s support for any pipeline.

Those so-called solutions, however, highlight the backwards thinking of dealing with major economic-driving projects.

First, a major project like Northern Gateway will automatically benefit B.C. and the rest of Canada through revenue-sharing programs.

Second, the Enbridge project is expected to pour billions of dollars into the provincial economy and create thousands of well-paying jobs — all without going to the company with palms open.

Still, from last week’s talk, it seems the province is likely to take demands for financial compensation directly to the oil and gas industry.

It’s a dangerous game to play, of course. Ask too much from a company and it may pull out stakes and try a different route.

Just look at TransCanada. The major oil firm has likely seen the headaches facing Enbridge by taking oil west for export, so it decided to reverse direction with its proposed Energy East Pipeline, which plans to carry 1.1 million barrels of crude oil to other markets via Eastern Canada.

While B.C. is taking on a lot of risk with pipelines and potential LNG projects, it should not be glossed over that the companies investing in the province are more than heartless, multibillion-dollar corporations — they, after all, are also taking on risk.

We Say editorials represent the viewpoint of The Daily News and are written by publisher Tim Shoults, city editor Tracy Gilchrist, or associate news editors Dan Spark and Mark Rogers.

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