IN THE NEWS ~ Newspaper owner's idea faces the same opposition confronting Northern Gateway itself

But the newspaper owner's idea faces the same opposition confronting  Northern Gateway itself

By Gordon Hoekstra, Peter O'Neil, Gordon  Hamilton And Jonathan Fowlie, Vancouver Sun


B.C. community newspaper publisher David Black has floated the idea of  building a $13-billion refinery near Kitimat to reframe the discussion on the  Northern Gateway oil pipeline by promising 10 times as many jobs and eliminating  the shipment of oil off the coast.

The idea is to process all of the 550,000 barrels a day of Alberta oilsands  bitumen from Enbridge's controversial Northern Gateway project in the refinery,  and then ship refined oil products such as gasoline, diesel and kerosene. Black  argues if there was a tanker spill, the refined products would cause less  environmental dam-age because they float and evaporate.

Black hopes his proposal will temper opposition from British Columbians and  first nations, many of whom have rejected the $6-billion pipeline project  because they say the economic rewards for B.C. are not great enough to offset  the risk and consequence of an oil spill.

Last month, B.C. Premier Christy Clark also declared the province would not  even consider the Northern Gateway project unless it gets a much greater share  of the economic benefits.

Black acknowledged he has no support from oil producers, who are seeking  higher investment returns from shipping and selling crude offshore.

He said he has no financial backers, no partners and has not discussed the  idea with potential Asian customers. He has had only brief discussions with a  pair of first nations in the Kitimat area.

Black, who owns more than 150 newspapers in Western Canada and the U.S., made  it clear he would not be investing in the refinery himself, noting even a  one-per-cent stake would cost $130 million.

Still, he said he believes sup-port and financial backing can be found for  the refinery and that people will listen to him.

The publisher described him-self as a "quiet environmentalist" whose  "nation-building" proposal would benefit the province by reducing environ-mental  impact, creating jobs and securing economic benefits from developing the  controversial pipeline.

"I'm hoping this will jump-start a change in the debate," he told reporters  at a news conference in downtown Vancouver.

"In other words, instead of just saying 'no,' let's say 'how can we work with  this to our advantage - get a lot out of it and solve potential problems at the  same time'." Black said he has support for the concept from Enbridge CEO Pat  Daniel, although the Calgary-based company declined to comment Friday.

The proposed refinery site is 3,000 hectares of industrial-zoned Crown land  25 kilometres north of Kitimat known as Dubose, which Black does not own. He has  reserved a name for a company, Kitimat Clean Ltd., but has not incorporated the  company.

Black plans to submit an environmental assessment application to B.C.  regulators next month, using his own money, which he estimates will cost a few  million dollars.

The proposed refinery in Kitimat would provide as many as 3,000 permanent  and contract jobs, 10 times more jobs than an export pipeline, he said.

Another 6,000 workers would be hired during a five-year construction  period.

In comparison, the Northern Gateway pipeline is estimated to create about 350  permanent and contract jobs in B.C., as well as thousands more during its  three-year construction phase.

Black said he has briefed Premier Clark, but the province hasn't told him  what its position on his proposal is yet.

On Friday, a statement from B.C. Energy Minister Rich Cole-man's office said  the province looks forward to seeing more details on the refinery.

Black also briefed staff at the Prime Minister's Office, who encouraged him  to propose the project, he added.

Natural Resources Minister Joe Oliver said Friday the federal government  welcomes any project that boosts Canadian exports and jobs, but he wouldn't pass  judgment on the idea.

"If he's serious, it's presumably because he's pushed the numbers and come to  a case. But I'm not in a position to know whether this is likely or not," said  the minister, who learned about the proposal through media.

Black's proposal, which would have the refinery approved by regulators and  operational by 2020, was met with skepticism among industry players and  observers, and rejected by critics of the Gateway project.

Black was confronted at the news conference by Coastal First Nation executive  director Art Sterritt, who warned the publisher should consult with first  nations before filing an environmental assessment application.

"Otherwise you are wasting your money."

Sterritt lauded Black in an interview for acknowledging that shipping oil off  the coast was not a good idea, but said a refinery brings a suite of new  problems, including air pollution in the pristine Kitimat Valley.

The Yinka Dene Alliance in northern B.C., said it remains opposed to the  project.

The alliance represents five first nations whose claimed traditional  territory encompasses 25 per cent of the pipeline route. "I don't know how many  times we have to say no. is another wolf in lamb's clothing," said  the alliance's Geraldine Thomas-Flurer.

Josh Paterson, staff lawyer at West Coast Environmental Law, said Black's  announcement caught the environmental movement off guard.

"People are floored by this. Where is this coming from? In terms of building  trust and relationships, this is the wrong way to go."

University of Calgary public policy professor Michal Moore said it is "naive"  to think a refinery would be built near Kitimat.

The Asian market is not looking for refined products, but oil, he said. It  would also be virtually impossible to mobilize the labour force and  infrastructure in a "tiny place" such as Kitimat to support a refinery.

The associations representing Canadian oil producers and refiners offered  modest support.

"The thing that's key for us as producers is the need for market access,"  said Greg Stringham, vice-president of the Canadian Association of Petroleum  Producers. "Any concept that helps facilitate that discussion is worth looking  at."

John Skowronski, director of government and stakeholder relations for the  Canadian Petroleum Products Institute, called Black's plan "an interesting  proposal."

"But at this point it's sort of a trial balloon if you will." he said.

The federal and provincial New Democratic Party and union leaders - who have  long opposed oilsands pipelines, partly because they believe bitumen should be  upgraded and processed in Canada - were skeptical if not outright hostile to the  idea.

"I don't think it changes anything in terms of public opinion in B.C.  against the Northern Gateway project," NDP natural resources critic Peter Julian  said. "The pipeline still threatens thousands of jobs in the fisheries and in  tourism."

B.C. NDP energy critic John Horgan said Black's proposal does nothing to  change his party's objections to the Northern Gateway, nor to the idea of  increasing tanker traffic on the north coast.

Alberta Federation of Labour president Gil McGowan said his organization has  always favoured keeping refining jobs in Canada rather than effectively  exporting jobs, along with unprocessed bitumen, to other countries.

"But we are not convinced this is a credible proposal," he said. "Is this a  real proposal or is it simply a ruse to help get the pipeline built?"

The proposed Northern Gate-way pipeline is meant to open up new markets for  crude from the Alberta oilsands, breaking the reliance on the U.S. market, and  fetching a higher price - an estimated $15 billion more a year - for Canada's  oil.

Black argued that goal can also be achieved with a coastal refinery with  access to Pacific Rim markets.

There would also be about 30-per-cent fewer tanker loads out of Kitimat  because the diluent used to thin bitumen piped to Kitimat would be stripped out  during refining and sent back to Alberta via pipeline. Black also argued that  building the refinery in B.C. will ensure it is a state-of-the-art facility with  a lower environmental footprint than if it were built in other areas.

While it would produce about seven million tonnes of carbon dioxide  emissions, those emissions would have been produced anyway, he said.

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© Copyright (c) The Vancouver  Sun

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