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Letter of Comment: Northern Gateway

Published by Derek Lothian on February 28, 2012

February 27, 2012

Secretary to the Joint Review Panel
Enbridge Northern Gateway Project
444 Seventh Avenue SW
Calgary AB  T2P 0X8

Dear Sir:

It is time to say "yes" to new energy market opportunities across the Pacific and to the employment and industrial opportunities across Canada that will be generated as a result of the Northern Gateway project.

I am pleased to submit this letter of comment in support of the Enbridge Northern Gateway Project on behalf of Canadian Manufacturers & Exporters and the more than 1.8 million Canadians our members employ.

Canadian Manufacturers & Exporters (CME) is Canada's largest industry and trade association. Since 1871, we have made a difference for Canada's manufacturing and exporting communities. Fighting for their future. Saving them money. Helping them grow. CME represents more than 10,000 leading companies drawn from all regions of Canada and from across Canada's industrial, technological, and service export sectors. More than 85 per cent of CME's members are small and medium-sized enterprises. Our membership accounts for approximately 82 per cent of Canadian manufacturing production and 90 per cent of Canada's goods and services exports. CME has a vital stake in the future of the Northern Gateway project. Our members are the companies that stand to benefit most from the development of new markets for Canada's energy and resource exports and from the new business opportunities that will be generated as a result of pipeline construction.

We commend the Panel for undertaking your review. It is an extremely important process to ensure that all stakeholder interests are heard and all aspects of the project are considered objectively. The result, we hope, will be a decision that takes the full scope of economic benefits into account, as well as issues of environmental protection and community development.

The Northern Gateway pipeline is of critical strategic importance for the BC economy, for economic, energy, and resource development across western Canada, and for the Canadian economy as a whole. It will provide an outlet for western Canadian oil to international markets. It will move Canada away from sole reliance on the US for our oil exports and allow us to capitalize on the fast growing markets of the Pacific Rim. The project will also create thousands of high paying, high value-adding jobs for Canadians. It will directly employ between 2,000 and 3,000 construction workers and generate an equal number of non-construction jobs during peak periods of project construction, in addition to 104 permanent positions in continuing pipeline operations and 113 positions in related marine services. Even more jobs will be created as a result of project procurement, related infrastructure development, and the taxes and consumer spending that will be generated as a result of pipeline construction and operations. In all, the Northern Gateway is expected to generate over $270 billion in additional opportunity for the Canadian economy over the next 30 years. It will also help sustain energy developments in western Canada that are themselves expected to generate over $1 trillion in economic spin-offs between 2016 and 2030.

In British Columbia alone, billions of dollars will be spent locally as a result of pipeline construction. In Northeast BC, procurement benefits from pipeline construction in the region will exceed $112 million , including $26 million in equipment rentals, $30 million for camps, accommodation, and catering, $16 million for clearing, logging, and salvaging operations, $12 million in fuel, $5 million for stockpiling pipe, $5 million for trucking firms, $5 million in equipment parts, $2 million for surveying, $4 million for the construction of access roads, and $6 million for other manufactured goods and services.

In central BC, pipeline construction will generate 5,160 person years of employment opportunities, 3,675 from within the region itself. There will be 1,805 person years in direct construction activity, with 500 originating from within the region. Peak pipeline construction will require 1,322 local employees. In addition, pipeline operations will create 19 jobs and purchasing operations an additional 65 local jobs. The project will procure $401 million on goods and services from the region including $102 million in equipment rentals, $94 million in construction camps and catering services, $61 million in clearing, logging, and salvaging, $42 million in fuel, $15 million in stockpiling pipe, $20 million in equipment parts, $7 million in surveying, $18 million in trucking services, and $23 million in road construction.

In BC’s coastal region, the project will generate 4,025 person years of employment, 2,235 of which are expected to come from within the region itself. There will be 1,715 person years of direct construction employment, 515 originating within the region. Peak terminal construction will require 419 people and peak tunnel and pipeline construction an additional 765. At the same time, $318 million in goods and services will be sourced within the region, including $121 million in site grading, $34 in equipment rentals, $81 million in camps, accommodation, and catering, $15 million in clearing, logging, and salvaging, $10 million in fuel, $3 million in pipe stockpiling, $6 million in equipment parts, $2 million n surveying, $6 million in trucking services, and $35 million in road construction.

In addition, the project will generate indirect benefits for BC in the form of consumer spending, public sector investment, and over $1.2 billion in business, property, and personal tax revenues that will in turn fund roads, schools, hospitals, social services, railroads, port, terminal, and other infrastructure and business development serving First Nations and communities along the pipeline route.

The importance of the Northern Gateway Project must also be assessed with respect to its role in supporting Canada’s oil sands developments. Analysis by the University of Calgary’s School of Public Policy estimates that “with better access *to the Pacific coast+ and new pipeline capacity, oil producers will see more efficient access to international markets which can add up to $131 billion to Canada’s GDP between 2016 and 2030.... This amounts to over $27 billion in federal, provincial, and municipal tax receipts, along with an estimated 649,000 person years of employment.”

We agree with Canada’s Building Trades Unions that the Northern Gateway is a game-changer for the Canadian economy, for skilled tradespeople, as well as for the manufacturers and services companies in BC and across Canada that will benefit as suppliers of the pipeline, associated infrastructure, and oil sands developments during the construction and subsequent maintenance of these projects.

The development of western Canada's energy and mineral resources provides a tremendous economic opportunity for Canadian industry and is essential for Canada’s long-term prosperity and energy security. Canada is in a unique position in that we can directly benefit from the production of a mix of different sources of energy, including nuclear, hydro-electricity, coal, natural gas, oil and renewable as well as develop high value, high paying jobs in the supply of manufactured goods and services in the construction of these energy projects.

The economic opportunities are immense. So too is our obligation to manage our resource heritage and our environment in a sustainable and responsible way. These are not incompatible goals. New monitoring and control technologies and responsible environmental practices are all critical elements of the Northern Gateway Project.

Your decision will make history. We urge you to set the standard for sound environmental management and economic prosperity by approving the Northern Gateway Project.


Jayson Myers
President & CEO
Canadian Manufacturers & Exporters

(cc: Kenneth MacDonald, VP, Law and Regulatory Affairs, Northern Gateway Pipelines Inc.; Abby Dorval, Manager, Regulatory Affairs, Northern Gateway Pipelines Inc.; Richard Neufeld, Q.C., Barrister & Solicitor, Fraser Milner Casgrain)


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