Conditions placed on approval won't stop pipeline from shipping high-value jobs overseas

Edmonton – Despite the evidence that the Northern Gateway will be detrimental to the interests of Canadians, the National Energy Board's Joint Review Panel has given the go-ahead for a pipeline that will transport hundreds of thousands of barrels of raw bitumen to refineries in China every day.

The approval, which places more than 200 caveats and conditions on the pipeline, was announced on Thursday. The province's labour movement, which has provided research and evidence throughout the debate over the pipeline, took aim at the decision.

"This is a decision that Canadians will come to regret, and it's a decision that ignores the evidence," Alberta Federation of Labour president Gil McGowan said. "They've placed more than 200 conditions on this approval, but none of those caveats change the fact that this pipeline will siphon jobs out of Alberta, out of Canada and out of North America. It's a monstrous bitumen superhighway which will send thousands of high-paying jobs in upgrading and refining out of the country. Instead of those jobs being created Fort McMurray or Fort Saskatchewan, they'll be created in Shanghai or Bejing."

McGowan vowed that the Alberta Federation of Labour will support First Nations and environmental groups that will almost certainly continue to fight against the pipeline.

The AFL has shown that pipeline project will only create 228 permanent jobs, and barely 1,500 short-term construction jobs. Meanwhile, more than 26,000 long-term high-value upgrading jobs will be farmed out to low-wage jurisdictions overseas.

The AFL has spent more than two years examining the Northern Gateway pipeline, sifting through evidence and participating in cross-examination on the economic benefits of the project. According to the research presented by the Federation, shipping an unrefined product overseas will be detrimental to existing upgrading in Canada, and will further undermine the pricing of Canadian natural resources. The pipeline will drive up costs for Canadian upgraders by more than $800 million dollars.

Other evidence submitted by the AFL and various experts shows that:

• Canada only captures about 35 per cent of the potential value of bitumen when it's shipped raw, compared to 75 per cent of the value when it's upgraded to Synthetic Crude (SCO) before being exported

• With the construction of new bitumen export pipelines like Northern Gateway, the Alberta government's own studies show that the per centage of bitumen upgraded in Canada will collapse to as little as 23 per cent, compared to the 65 per cent that has traditionally been upgraded in the country.

"Governments at all levels pay lip service to wanting to keep good jobs in Canada, but they always end up putting the narrow interests of big energy corporations ahead of the broader public interests of Canadians," McGowan said, adding this is this is the AFL's fourth intervention against raw bitumen exports in recent years.

McGowan said he was pleased the review panel at least acknowledged that the AFL and the Communication Energy Paperworkers union (CEP) had raised "valid public interest considerations" in the arguments they made about lost Canadian jobs. But he was "disappointed and frustrated" by panel's conclusion that private energy companies would build more upgraders and refineries in Canada if it was economic to do so.

"The panel is ignoring the fact that governments in both the U.S. and China heavily subsidize their refining industries. That's why they've decided to rip and ship our resources and send them to refineries in their home countries. Given that these are resources owned by the Canadian public, the question that Canadians should be asking themselves is this: does it make sense for us to let other countries keep the jobs for themselves and leave us with the pollution and a few economic crumbs from the table?"

McGowan said the panel report demonstrates the need for a clear national energy strategy that puts the needs and interests of the Canadian public first.

"We shouldn't expect bureaucrats like those who worked on the review panel to stand up to big oil companies," McGowan said. "They can't and they won't. What we need, instead, are politicians with courage; politicians who remember that they work for Canadians citizens, not multi-national oil companies. More specifically, we need a made-in-Canada energy strategy that puts a priority on long-term job creation for Canadians and energy security for Canada. Every other energy-producing country in the world, including the U.S., has a strategy to protect and promote their own domestic interests. It's time for our politicians to get their heads out of the oil sands, pardon the pun, and start standing up for Canadians, instead of caving in to the Exxons and Sinopecs of the world."

For a particularly thoughtful analysis of the Northern Gateway debate, please watch the video recently prepared by independent economist Robyn Allan, who appeared as an expert witness for the AFL during the joint panel hearings. The video can be found at this address: http://www.robynallan.com/2013/12/09/pipelines-and-oil-tankers/

-30-

MEDIA CONTACT:

Gil McGowan, President, Alberta Federation of Labour at 780-218-9888 (cell)

Olav Rokne, Communications Director, Alberta Federation of Labour at 780.289.6528 (cell) or via e-mail [email protected]

CALGARY - The inability to get western Canadian crude to the right markets is costing the country's economy dearly, according to a new report paid for by the Saskatchewan government.

Each stalled pipeline project means a loss to the Canadian economy of between $30 million and $70 million every day, said the report penned by the Canada West Foundation, a Calgary-based think-tank.

"The economic impact is just devastating," foundation CEO Dylan Jones said in an interview Thursday.

The Saskatchewan government paid $50,000 to commission the report.

Premier Brad Wall has been an outspoken supporter of new pipeline projects, most recently signing a letter, along with 10 U.S. governors, urging U.S. President Barack Obama to approve the Keystone XL pipeline.

Alberta's oilsands, the third-largest reserves on the planet, get most of the attention when it comes to the pipeline debate.

But Saskatchewan, which has considerable oil resources of its own, is affected by the pipeline pinch as well, Wall said in Regina.

"We hope that this helps get the message out, even to a greater degree than it is now, that we have a pipeline capacity issue in western North America and that's costing Saskatchewan people a lot of money," he said.

"Because of the pipeline capacity issue, we're losing up to 19 to 20 per cent return on the taxpayer's resource."

In recent months, oilsands crude has been trading at a painfully steep discount to both U.S. and global light crude benchmarks. It's a trend that has both eroded oilpatch profits and caused the Alberta government to warn of a $6 billion revenue shortfall this year.

At the heart of the problem is a lack of adequate pipeline capacity to get that crude to the markets that want it most. Proposals of eastbound, westbound and southbound pipelines are in varying stages of development, but environmental opposition and political wrangling makes their fates uncertain.

Most pipeline capacity out of Western Canada heads to the U.S. Midwest, which Jones calls "the worst place in the world to be selling oil" as booming production from areas like North Dakota floods the market.

The Canada West Foundation says new pipelines need to be built in the right directions.

A massive expansion to Trans Mountain and Enbridge's Northern Gateway proposal would enable crude to be transported to Asia via tankers from the West Coast, but they face stiff opposition within B.C. on environmental grounds.

TransCanada Corp. is awaiting final U.S. government approval for the northern leg of its Keystone XL pipeline, which would allow Canadian crude to flow to refineries on the Gulf Coast that are thirsty for heavy oil. Construction on the southern leg between Oklahoma and the Gulf is underway.

Refineries in eastern Canada and the U.S. Eastern Seaboard rely on pricey imported crude from overseas, which is hurting their economics. Both TransCanada and Enbridge have projects in the works to send western crude eastward through reconfigured pipes that are already in the ground. It's possible those lines could extend all the way to New Brunswick, home to Canada's largest refinery.

"If pipeline project proposals such as Trans Mountain, Keystone XL and Northern Gateway don't move forward, Canada will be foregoing $1.3 trillion in economic output, 7.4 million person-years of employment and $281 billion in tax revenue between now and 2035," said Michael Holden, the foundation's senior economist and author of the report.

While most of the benefits would accrue to Alberta, Holden said those three projects would add a combined $84 billion to economies elsewhere in Canada.

The report calls on provinces to work together to tackle the problem, the way Alberta Premier Alison Redford and New Brunswick Premier David Alward did earlier this week in touting an eastbound oil pipeline.

Keith Stewart, climate and energy campaign co-ordinator at Greenpeace, says the Canada West Foundation report "misses the point."

"If we want to avoid climate chaos, we have to stop building fossil fuel infrastructure like new tar sands pipelines," he said.

"Canada can, and should be a winner by building the climate-safe, green energy economy that our kids need and deserve."

The Alberta Federation of Labour also has a different view of the issue.

The group said in a report earlier this week that Alberta should require energy companies to upgrade oil in the province before they are allowed to ship it.

Federation president Gil McGowan said the Alberta government continues to approve in situ oilsands projects without requiring associated upgrading, which converts bitumen from the oilsands into light oil refineries can use. That's flooding the U.S. market and driving down the price.

Environmental opposition has been particularly strong to pipelines that would ship oilsands bitumen, the thick, tarry stuff that needs to be diluted in order to flow.

And that alone might force governments to take a hard look at upgrading and refining opportunities at home, said Wall.

"There's all manner of politics, some of it based on reality, some of it not," said Wall.

"If we can't get pipelines built because of it, we just have to start not moving bitumen, but moving a refined product."

Times Colonist, Thursday, Feb. 7, 2013
Byline: Lauren Krugel, The Canadian Press with files from Jennifer Graham in Regina

Albertan labour organizations and environmental groups declared their support for the Idle No More movement during a rally in Edmonton Monday.

In front of over 100 Idle No More demonstrators in Churchill Square, representatives from the Canadian Labour Congress, The Alberta Federation of Labour, Greenpeace Canada, The Alberta College of Social Workers, The Edmonton District Labour Council, and more, signed a declaration of solidarity with the movement.

The combined movement is being called Common Causes and aims to "defend democracy" by challenging Prime Minister Stephen Harper and the Conservative government's environmental legislation in omnibus Bill C-45.

"What you saw today is a number of key labour groups who are deeply concerned about their own members and their own ability to speak out on issues that matter to the average working person," said Common Causes spokesman Bill Moore-Kilgannon.

"But you also saw social workers, environmental groups, and recent immigrants coming here to say that all these things affect us as citizens and that's the debate we need to have in this country."

The Idle No More movement says Bill C-45 will further open access to resource exploitation on treaty lands, weaken local control over water, land and air, and erode aboriginal rights to protect their own culture and language.

Nancy Furlong, secretary treasurer of the Alberta Federation of Labour that acts on behalf of over 150,000 Albertans, said Bill C-45 is an attack on Canada's indigenous peoples as well as an attack on unions.

"(Harper) is destroying unions with bills specifically designed to silence the voices of the working people," said Furlong. "He does not share our values and he does not stand for fairness and we won't be idle any longer."

Greenpeace Canada said they were supporting the Idle No More movement to combat "Harper's atrocious omnibus bills."

"They are not only an attack on indigenous rights but on environmental laws and they are also an attack on the democratic rights of all Canadians," said Melina Laboucan-Massino with Greenpeace.

While agreeing there needs to be more public education about the movement, Moore-Kilgannon denied that the partnership between Common Causes and Idle No More will broaden the issues while simultaneously confusing the average Canadian.

"I don't see it diluting the issues at all, I see it strengthening them," he said. "The things that Idle No More is talking about: water, democracy, human rights, our relationship to each other... These are things that matter to everybody."

Moore-Kilgannon said Common Causes organizations will be involved with Idle No More in "various ways" but refused to say if they will join First Nations in blockading Alberta highways.

The rally was planned as a part of a national day of action in 25 Canadian cities to coincide with the resumption of parliament.

Edmonton Sun, Monday, Jan. 28, 2013
Byline: Matthew Dykstra

EDMONTON - The Idle No More movement marked a global day of action Monday with a rally in Churchill Square that saw leaders from a variety of organizations declare solidarity with the movement.

More than 200 people gathered in Churchill Square to hear representatives from nine organizations, including labour and environmental groups, share short messages of support for Idle No More and sign a declaration of solidarity. The speeches were followed by a tea dance with the Dene Tha' Drummers.

"There are exciting moments in history where people stand together, they band together and begin to resist. I believe that we're witnessing that today when we announce Common Causes, a national movement to bring together people of differing passions," said Nancy Furlong with the Alberta Federation of Labour.

On Monday, groups across Canada launched Common Causes, an assembly of social movements dedicated to defending democracy, social justice, the environment and human rights. Common Causes held rallies and marches in co-ordination with Idle No More's global day of action, which came as Canada's MPs returned to the House of Commons.

In Alberta, other Idle No More events included a march in St. Paul and a protest in Little Buffalo.

Garrett Tomlinson, communications co-ordinator with Lubicon Lake Nation, said about 50 people took part in a roadside protest on Highway 986, which began at 1 p.m. and was expected to last until dark.

In Edmonton, Morningstar Mercredi co-hosted the Churchill Square event with Public Interest Alberta's Bill Moore-Kilgannon.

"We will not stand by idly, we will not be silenced, we will unify and that is what you're witnessing today," Mercredi said.

Lori Sigurdson, on behalf of the Alberta College of Social Workers, declared solidarity with Idle No More and made reference to the controversial omnibus Bill C-45.

"We see first-hand the suffering of the aboriginal people and this bill that has gone through will only continue that," she said.

Representatives from the Canadian Labour Congress, the Council of Canadians, Greenpeace, Friends of Medicare, the Sierra Club's prairie chapter and the Memoria Viva Society also signed the declaration.

Kayla Scanie, a member of Cold Lake First Nations, called Monday's rally "awesome." She hopes to see even more people support Idle No More at future events.

Nancy Dodsworth, with the Canadian Union of Postal Workers, attended the event and said she has waited a long time for a movement such as Idle No More.

"Our environment has been destroyed for so long, so to have everyone come together and start to be really active is phenomenal. People are waking up and I'm grateful for that," she said.

Edmonton Journal, Monday, Jan 28 2013
Byline:  Cailynn Klingbeil

Edmontonians packed Allendale Community Hall Sunday evening for a discussion of Idle No More, as communities and organizations worldwide planned for a show of solidarity with the movement on Monday.

"The goal here is to educate," said Richard Merry, chair of the Council of Canadians' Edmonton chapter. The group organized Sunday's event, titled Building Edmonton Solidarity with Idle No More.

The discussion was a chance for people of all backgrounds to learn more about the movement and how to participate.

"We hope to stimulate people to support the grievances of First Nations people much more directly, not just to watch it," Merry said.

More than 100 people gathered in the hall to hear Tanya Kappo, a member of the Sturgeon Lake Cree Nation who launched the Alberta version of Idle No More, speak about the movement.

Darian Selander, 24, attended the discussion with her brother, William Selander, 15, and friend Ellen Parsons, 24.

"It's a cause I want to know more about," said Selander, who has not been to any other Idle No More events.

"I've heard a lot of negative stuff about Idle No More, so I wanted to hear more about it from people who support it and are involved with it," Parsons said.

Mervin Grandbois, a member of the Cold Lake First Nation, was pleased to see so many people show an interest in learning about the movement.

"We need events like this to show that this is not only an aboriginal thing, it involves all people," Grandbois said.

The Edmonton event came as an assembly of 47 groups across Canada, including the Council of Canadians, prepared to launch a national effort Monday in support of Idle No More, timed to coincide with Parliament resuming in Ottawa.

United under the banner of Common Causes, the assembly's mandate includes defending democracy, social justice, the environment and human rights.

"We see the First Nations' struggles as a struggle of all Canadian people," Merry said.

Public Interest Alberta is one of the organizations joining Common Causes.

Executive director Bill Moore-Kilgannon helped put together an event at Churchill Square Monday that will feature speakers and a tea dance with the Dene Tha' Drummers.

"We are all deeply concerned about how we, as citizens, can make sure those voices that are concerned about the environment, health care, foreign policy, and human rights are being heard. Common Causes joining up and supporting Idle No More is really what (Monday) is all about," Moore-Kilgannon said.

While flash mobs and rallies have been used to protest Bill C-45 and C-38, Moore-Kilgannon said teach-ins are now helping people, many of whom are not First Nations, delve deeper into the issues the Idle No More movement addresses.

A teach-in session on Sunday afternoon connected the labour movement with Idle No More, attracting close to 100 people. Morningstar Mercredi, who has been active with Idle No More, was the main organizer of the event.

"We are all idle no more because of the bills, because of (Prime Minister Stephen) Harper's mandate, because of his inability to consult," said Mercredi.

Mercredi isn't surprised Idle No More is expanding to labour groups and other organizations.

"The bills will affect and have direct impact on every person, every single women, child, elder, man, everyone," she said.

Amanda Freistadt, a representative with the Canadian Labour Congress, attended the teach-in Sunday and plans to be at Churchill Square Monday.

"If we make connections with each other and we share commonalities and we build relationships with each other, we have the ability to influence progressive change in a way that we wouldn't if we didn't get together," Freistadt said.

Gil McGowan, president of the Alberta Federation of Labour, was also in attendance.

"We in the labour movement share the First Nation communities' concerns about this breakneck approach to development, because we don't think that it's in the long-term best interest of Canadians who own the resource, whether they're aboriginal or non-aboriginal," McGowan said.

"It's not just about First Nations, it's about all of us and all of our relations to each other and to our environment," Moore-Kilgannon said.

Edmonton Journal, Sunday, Jan. 27, 2013
Byline: Carilynn Klingbeil

VANCOUVER - The nationwide Idle No More movement merged with ongoing protests against oil pipeline projects proposed for British Columbia, to bring more than a thousand protesters out to greet the federal review panel conducting hearings in Vancouver.

The community hearings by the federal panel on the Northern Gateway project are scheduled to resume this morning, after a noisy start on Monday night.

First Nations from as far as the Haisla Nation on the North Coast, near the would-be tanker port of Kitimat, B.C., and from the Interior took part in a march to the downtown hotel where the hearings are being held.

"The Harper government has one of the most aggressive, high-carbon strategies in the world," Eddie Gardner, of the Sto:lo Nation, told the crowd as they mobilized ahead of the march.

He blasted the federal Conservatives for changes they've made to environmental laws that will affect oversight of the Northern Gateway proposed by Enbridge (TSX:ENB) and other projects.

"He implemented that legislation, it has become law, and he did it with crass and ruthless disregard for the environment," Gardner told the protesters.

"Stephen Harper is hell bent to expand the tar sands.

"Canada is coming alive to Harper's real agenda ... he is one of the biggest enemies of the environment."

Protesters were met by Vancouver police, who kept them from entering the building. They remained outside the Sheraton Wall Centre for a short time, drumming and chanting "No Pipelines" before moving on.

Kiera Corrigan, 25, said she is originally from Bella Coola, a small community on the central coast.

"I think it's really important that we don't put in this pipeline. My home town is right south of Kitimat, so it hits really close to home if we ever have an oil spill, which there will be," she said.

Protesters also took aim at a proposed expansion of the existing TransMountain pipeline operated by Kinder Morgan.

The pipeline moves oil from the oil sands to port in Vancouver, and a proposed $4.3-billion expansion would more than double the capacity of the 1,100-kilometre line.

The joint review panel, which is weighing the Northern Gateway, has scheduled eight days of hearings in Vancouver.

They're hearing public comment on the controversial plan to deliver oil from the Alberta oil sands to a tanker port on the North Coast of B.C.

Community hearings were held previously in Victoria, and a one-day hearing is scheduled in Kelowna later this month.

The panel limited access to the hearings room to participants.

"Given the large urban nature of Victoria and Vancouver and previous protests held in both locations regarding the proposed Enbridge Northern Gateway project (the project), the panel has decided that it will limit access to the hearing room," stated the directive.

Members of the public are able to listen to submissions in another location. The hearings are also being streamed live on the panel website.

Access to the hearings remained closed off after the protesters dispersed.

Inside, the three-person panel heard from a range of interested members of the public, from First Nations and environmentalists, to a scientist who lamented telling her children and grandchildren about what she did about climate change.

"What will you tell your grandchildren?" the woman asked the panel.

Eric Doherty, a former Canadian Coast Guard marine engineer turned environmental planner, chided the panel for failing to consider emissions from the Alberta oil sands in its assessment.

"It's no longer controversial that global warming is killing people," he said. "It's no longer controversial that global warming is THE threat to our society."

The pipeline project has been incredibly divisive in British Columbia and as the end of the long regulatory process nears, both sides are trying their utmost to rally support.

The United Association of Plumbers and Pipefitters decided to weigh in Monday, with a statement from Canadian director John Telford stating that the project "will provide jobs to members in Eastern Canada as well as the West."

"The regulation of the oil and gas industry as a whole ensures that the impact to the environment and native peoples will be minimal and the benefits should far exceed any possible drawbacks," the union said in the statement.

And Enbridge has been on a charm offensive in the province for months, with full-page newspaper ads and radio ads extolling the benefits of the project and assuring B.C. residents they will employ world-leading safety measures.

The panel held final hearings earlier in Edmonton, Prince George and Prince Rupert, where company experts and interveners answered questions under oath.

Those hearings will resume in Prince Rupert next month, and the panel must submit its recommendations to the Environment Minister by the end of this year.

Huffpost BC, Tuesday, Jan. 15, 2013
Byline: Dene Moore, The Canadian Press

Harper’s new ownership guidelines won’t stop Chinese from exerting control in Alberta’s oil sands, according to new AFL report

CALGARY – Albertans concerned about the future of the oil sands should not be reassured by new guidelines for state-owned enterprises (SOEs) unveiled by Prime Minister Stephen Harper late Friday afternoon.

A new report prepared by the Alberta Federation of Labour entitled “China’s Gas Tank” shows that the Chinese have a plan for the oil sands – a plan that is not in the long-term best interests of the citizens of Alberta who are the real owners of the resource.

“Now that they own Nexen, the Chinese government will have control over the marketing of about 300,000 barrels of bitumen a day and they will increase their control of Syncrude, Canada’s largest oil sands producer, which will now have representatives from Sinopec and CNOOC on its board wielding veto power,” AFL president Gil McGowan said.

“The Chinese government doesn’t need majority ownership of the oil sands to exert a significant degree of control. It’s already happening. And if more isn’t done to protect the interests of Canadians, we can kiss goodbye to our hopes and dreams about moving up the value ladder.”

The AFL report is based on new documents and testimony about Chinese ownership released as part of the ongoing regulatory hearings into the proposed Northern Gateway Pipeline, as well as documents that CNOOC and Sinopec have been required to file with the U.S. Security Exchange Commission (SEC).

The report makes a number of significant revelations about the Chinese government’s practices and intentions, including the following:

• The Chinese are attracted to the oil sands because they want access to cheap feedstock for their refineries. Specifically, they want to lock in an alternative to high-priced oil from Saudi Arabia. As a result, selling to Chinese SOEs won’t result in an “Asia Premium” for Alberta producers: China wants to pay less, not more.

• Nexen will help China reach its goals because the company’s marketing arm handles about 300,000 barrels of bitumen a day. Nexen’s marketing expertise is currently used to get the best (i.e. highest) prices for shareholders. But it could easily be used to get the lowest prices for Chinese refiners – and that means downward pressure on bitumen prices for Canadian producers and the Alberta public.

• CNOOC in their own words in their April 2012 filing to the SEC: “We sell a significant proportion of our production to CNOOC-affiliated companies Sinopec and PetroChina.”

• The Nexen deal means the Chinese will strengthen their influence over Syncrude, Canada’s largest oil sands producer. Sinopec already owns nine per cent of the company and they have used their stake to veto any new Canadian upgrading projects. Nexen owns seven per cent of Syncrude, meaning that the Chinese government’s stake in the company will now increase to 16 per cent.

•  Rumors continue to swirl that the Chinese intend to buy significant stakes in Canadian Oilsands Ltd., which owns 36 per cent of Syncrude. If this happens, China could move from a position of significant influence to one of outright control at Canada’s largest oil sands producer.

• The Chinese also have what is likely a controlling interest in the proposed Northern Gateway Pipeline. The project has ten funding partners, only six of which have been named publicly. The publicly-named partners include: Sinopec; Nexen (now owned by CNOOC); MEG (owned 15 per cent by CNOOC); Total E & P Canada (in joint venture partnership with Sinopec); Suncor (in joint venture partnership with Teck Resources, which is 17 per cent owned by state-owned China Investment Corporation); Cenovus.

“What’s happening here is an elegant plan to gain control of all steps in the oil sands production chain: from extraction to marketing to transportation,” McGowan said. “Once that’s done, the Chinese will be able to keep prices low and keep the raw bitumen flowing to refineries in China. This will mean lower profits for Albertans who own the resource, lower royalties for Canadian governments and the loss of thousands of potential Canadian jobs in upgrading.”

McGowan says that stopping the CNOOC takeover of Nexen would have been one tool to protect the interests of Canadians. But now that the Harper Conservatives have dropped that ball, he says it’s even more important to stop the Canada-China investment treaty (FIPA) and the Northern Gateway pipeline.

“Northern Gateway would provide the plumbing to drain profits and jobs from Alberta and FIPA would tie the hands of future governments who might want to change the rules,” McGowan said.

“At the end of the day it’s clear that China’s interests are at odds with Canada’s interests. It’s also clear that we can’t rely on the so-called free-market companies to save the day, because they’re all in bed with the Chinese. What we need is a government that’s willing to step in and impose a national energy strategy that puts the interests of Canadians ahead of the interests of foreign governments and profit-seeking corporations that focus only on their short-run self interest.”

-30-

MEDIA CONTACT:

Gil McGowan, President, Alberta Federation of Labour at 780-218-9888 (cell)
Olav Rokne, AFL Communications Director at 780-289-6528 (cell) or via email [email protected].

Harper’s new ownership guidelines won’t stop Chinese from exerting control in Alberta’s oil sands,
according to new AFL report

CALGARY – Albertans concerned about the future of the oil sands should not be reassured by new guidelines for state-owned enterprises (SOEs) unveiled by Prime Minister Stephen Harper late Friday afternoon.

A new report prepared by the Alberta Federation of Labour entitled “China’s Gas Tank” shows that the Chinese have a plan for the oil sands – a plan that is not in the long-term best interests of the citizens of Alberta who are the real owners of the resource.

“Now that they own Nexen, the Chinese government will have control over the marketing of about 300,000 barrels of bitumen a day and they will increase their control of Syncrude, Canada’s largest oil sands producer, which will now have representatives from Sinopec and CNOOC on its board wielding veto power,” says AFL president Gil McGowan.

AFL president Gil McGowan will be available for media at the Canadian Council of Chief Executives conference in Calgary at the Palliser Hotel.

Where:
Outside the Alberta Ballroom
Palliser Hotel Calgary
133 - 9th Ave. SW, Calgary

Monday, Dec. 10, 12:30 p.m.

Who:
Gil McGowan, President, Alberta Federation of Labour (780) 218-9888

-30-

China’s Gas Tank

Three Steps Toward Selling Out Canadian Energy Security

December 17, 2012

Chinese-Canadian business relations are being redefined, as we cede decision-making power about our natural resources to state-owned foreign businesses. These businesses are not bound by market pressures and will not act in the best interests of Canadians.

The economic relationship between Canada and China is being redefined.

Over the past year, three major events have dominated the headlines on Canadian business pages. These stories are each part of a larger picture in which Canada’s national interests are being subverted, and the country’s strategic energy assets are being taken over. From exploration and production to transportation and marketing, control of the oil sands is being ceded to state-owned foreign companies.

The China National Offshore Oil Corporation (CNOOC) takeover of Nexen gives a Chinese state-owned oil company marketing control over several hundred thousand barrels per day of oil sands bitumen. Marketing control gives CNOOC power over the price – which means we are handing over control of Alberta’s most important source of royalty revenue to a state-owned enterprise.

At the behest of funding partners that are backed by Chinese state-owned oil companies, the Northern Gateway Pipeline locks in a future where Alberta’s resources leave the country in their rawest form possible. This will ship good paying jobs to China.

“Harper is saying what Canadians want to hear while doing what they don’t want” - AFL president

Edmonton – Prime Minister Harper’s supposedly “tough new conditions” for foreign takeovers are nothing more than a public relations ploy aimed at masking the fact that he has just allowed a foreign government to seize unprecedented control over Canada’s energy resources.

In an announcement late Friday, Dec. 7, Prime Minister Stephen Harper green-lit Chinese oil giant CNOOC’s $15-billion takeover of Alberta-based Nexen, but claimed that new conditions would prevent such deals in the future. 

“The Conservatives are spinning this as a ‘sweeping overhaul’ of foreign investment rules,” McGowan said.“The new ‘guidelines’ for foreign takeover decisions will still see the process take place behind closed doors and be conducted by the Industry Minister.”

“The ‘new process’ Harper has proposed is the same as the old process, which just brought us the largest foreign oil patch takeover in Canadian history,” McGowan said. “They’re saying what Canadians want to hear, but doing exactly what Canadians don’t want. It’s the Republican Tea-Party playbook: tell a bald-faced lie, and hope no one questions you.”

Under the new conditions proposed, the federal government will weigh how much influence state-owned foreign takeovers will have over their acquisitions and an industry, and how much control over Canadian resources this will give the foreign government. Regulators will examine this in private, behind closed doors, and with no public input required.

 “How do you measure this influence? What is the measurement on which this will be evaluated? These are meaningless rules – it’s just a smokescreen,” McGowan said. “Sinopec only has a nine per cent stake in Syncrude…but they used that nine per cent stake to veto upgrading projects. Is there a measurement of how bad that is for Canada?”

The proposed CNOOC takeover has been criticized by Canadians across a broad political spectrum, including Preston Manning, the New Democratic Party and the Communications Energy and Paperworker’s Union.

“CNOOC is not your typical oil company. It doesn’t operate on market principles, and it isn’t beholden to investors. If they had been serious about defending the interest of Canadians, they would have nixed the deal outright,” McGowan said. “They had a good pretext already – Harper’s 2006 campaign pledge ‘not to export more raw bitumen to countries with laxer carbon standards than North America’s.’ If they had cared about state-owned foreign ownership, they would have scuttled this deal.”

The AFL will release a comprehensive report on China’s involvement in Alberta’s Oil Sands on Monday in Calgary.

-30-

MEDIA CONTACT:

Gil McGowan, President, Alberta Federation of Labour at 780-218-9888 (cell)
Olav Rokne, AFL Communications Director at 780-289-6528 (cell) or via email [email protected].