(Vancouver) A report released today by the Canadian Centre for Policy Alternatives finds that offshore oil and gas development off BC's coast will not bring the hoped for levels of wealth or job creation to the province. Should BC Lift the Oil Moratorium? Economic Lessons from Hibernia draws on the Newfoundland experience to determine what British Columbians might expect from lifting the offshore oil moratorium.
A caucus of Liberal MLAs is now touring northern communities to get feedback on offshore oil development in BC. Dale Marshall, resource policy analyst with the Centre and author of the report, cautions against lifting the moratorium. "Even if you look at this strictly from an economic point of view, offshore oil does not make sense for BC," says Marshall.
The report tabulates the billions of dollars that the federal and Newfoundland governments poured into Hibernia to make the project viable. "Those governments spent a billion in grants and a billion in investment capital, on top of the billions in tax exemptions, interest-free loans, and loan guarantees," states Marshall. "Based on the royalties agreement struck with the Hibernia Management Development Corp., there is no guarantee that the governments will recuperate all their money through royalties and tax revenues."
The report also investigates the job creation potential of offshore oil development and concludes that the majority of jobs created are temporary. "Many of the Newfoundlanders who were lucky enough to help build Hibernia are now working overseas, since comparable jobs no longer exist. Moreover, the drilling platforms are increasingly being built in international locations like South Korea, places that already have facilities and that benefit from cheap labour," warns Marshall.
"Communities like Port Hardy and Prince Rupert are clearly in need of community economic development projects," states Marshall. "But going with offshore oil is a lost opportunity. Investments in renewable energy create 60% more jobs compared to offshore oil, and conservation projects create five times more jobs. We should be shifting our attention to these technologies. They are not part of sunset industries, they promise tremendous growth in the future, and they provide a greater number of more stable jobs for British Columbians."