March 2010

North of 49°
New Oil Sands Refinery Project Fuels Alberta's Economic Recovery
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The great recession of 2009 may have led to a slowdown in the normally busy oil sands region in northern Alberta, but in 2010 Canada's biggest job market is hotter than ever—and it's putting thousands of building trades members to work.

"A year ago, we had a three-month bump when we had to send all the travelers home," said Edmonton Local 424 Business Agent Wade Ashton. "We had a hard time making sure all our members were working." It is a sentiment not usually expressed in Alberta, which has one of the tightest labour markets in Canada, thanks to the oil and gas industry.

Record low oil prices last year put many projects in the oil sands—the second-largest reserve of petroleum in the world—on hold, but the recent jump in energy prices and positive signs that the recession may be winding down have given the area an economic jumpstart.

Leading the way is Royal Dutch Shell's new $27 billion oil upgrade facility, located just outside Edmon-ton, which will process tar-heavy oil from Fort McMurray for refineries in the United States. The heavy crude oil from the region is mined, not pumped, and requires a great deal of refining before it is useable.

The project, Scotford Upgrader 2, is the biggest construction project in Canada, employing more than 8,000 workers, including more than 2,700 IBEW members.

"It's the busiest work site in Canada right now," said Local 424 Business Manager Tim Brower of the Fort McMurray site, more than 400 kilometers (or about 200 miles) north of the provincial capital. "We're at full employment."

IBEW members from throughout Canada are being recruited to come to Edmonton, with contractors even offering a $100-a-day stipend for out-of-town workers.

It isn't easy work, particularly as the frigid Alberta winter blows across the prairies, with temperatures dropping as low as minus 26 degrees Celsius (or minus 17 Fahrenheit).

But IBEW members are glad to be on the job again.

"We are going to need even more electricians on this project before it is completed," Brower said.

The massive project, which is to be built in four phases, is expected to take upwards of 15 years to complete. The first phase is expected to be completed by September.

The upgrader will have a total processing capacity of 400,000 barrels a day.

Other oil sands projects in the works include an $8 billion mine being built by Imperial Oil an hour north of Fort McMurray. The job will require thousands of skilled workers, and Local 424 is gearing up.

"We're going have to fight hard for the job," Ashton said. Unlike the strongly union Edmonton area, Local 424 and its contractors face increasingly cutthroat competition in Fort McMurray from both nonunion contractors and the Christian Labour Association of Canada, an employee association that many in the labour movement have criticized for signing sweetheart deals with employers.

"We'll be very busy until the end of the summer and then we're getting ready for the next big project," Ashton said.

Canadian Building Trades Calls for Balanced Debate on Oil Sands' Future

In the face of environmental criticism, the Canadian building trades is calling on policy makers and elected officials to engage in a fair debate about the future of the oil sands region in Alberta. It is sponsoring an ad campaign in favor of balancing the need for good jobs and an inexpensive energy supply with concerns about reducing carbon emissions and fighting pollution.

In an ad that ran in the Hill Times, Canada's leading political weekly, the Canadian building trades, said: "Debate about the oil sands is important, but it must be a reasonable debate … we need the oil sands. It is a secure supply of a required energy and significant economic resources."

The oil sands region represents the second-largest reserve of petroleum in the world, and in recent years it has become the economic powerhouse of Canada. But the process of extracting oil from the sand is intensive and dirty and it takes its toll on the environment, leading to bad press and increased calls from environmental groups like Greenpeace for a shutdown of projects there.

While sharing concerns about global warming and air quality, many building trades members feel that the oil sands are being unfairly targeted out of proportion to its actual impact on the environment, says Robert Blakely, director of Canadian affairs for the Building and Construction Trades Department, AFL-CIO.

"There is too much alarmism by some in the environmental community," he said. "We need to make sure the debate is grounded in reality, not fear."

The building trades' ads point to the progress made on the environmental front by the oil sands industry. Carbon emissions in the oil sands are down by nearly 30 percent since 1990 thanks to new technological advances, and less than 5 percent of Canada's greenhouse gas emissions come from the region.

"We and our families want our children to inherit a healthy environment," the Building Trades of Alberta said in a statement on its Web site. "We believe that improved processes and technology will continue to reduce the environmental impacts of oil sands devwelopment."

Building trades leaders also say that groups like Greenpeace ignore the importance of the oil sands to Canada's economy. More than 200,000 jobs from across the country are linked to the oil sands, making development in the region key to Canada's future.

"For the tens of thousands of workers whose livelihoods depend on the oil sands, the region is too vital for the environmental debate to be based on anything but hard facts," said IBEW First District Vice President Phil Flemming. "There are too many jobs at stake."