The Electrical Worker online
December 2014

Natural Gas Brings Jobs to East, West Coasts
The Changing Face of Canada's Energy Industry

index.html Home    print Print    email Email

Go to

Editor's Note: This is the second of a two-part series on how the changing energy landscape is affecting IBEW members across North America.

The oil and energy boom in the United States in many ways parallels what happened north of the border a decade ago.

In the early 2000s, drilling in the oil sands region of Northern Alberta took off, fueling an energy boom that kept Canada's building trades busy, even during the worst of the 2008-2009 global recession.

Alberta added nearly a half million jobs between 2003 and 2013, the highest growth rate in the nation. And construction jobs lead employment growth, accounting for 31 percent of Alberta's job gains, according to provincial statistics.

But just as America's energy boom is heating up, a global drop in oil prices may slow Alberta's down.

Petroleum prices dropped more than 20 percent in October from just a few months ago, reported Politico.

"If world prices remain low, we may see a slowdown in new oil sands development," says Edmonton Local 424 Business Agent Ken MacKenzie.

That month, the Calgary Herald reported on a survey of energy infrastructure companies that revealed an increasingly negative mood about future investment in the region.

Alberta is particularly susceptible to a drop in prices, as tar sands oil sells at $20 to $30 (U.S. dollars) less than conventional crude, reported Public Radio International.

The delay in the approval of new oil pipelines, particularly the Keystone XL pipeline, which would transport Canadian oil to the United States, is eating into returns, with the cost of rail transport tacking on an extra $15 to $20 per barrel.

At least three multibillion dollar contracts have either been canceled or postponed in the past three years, including a $12 billion upgrader, which would have processed tar sands oil, and a $11 billion mine to be built by French energy giant Total S.A.

All three projects cited volatile energy markets and increased capital costs for the delays, MacKenzie said.

Tar sands crude requires extra processing to separate clay and sand from the bitumen. The majority of processing is done outside the province, which raises costs and slashes profits.

Local 424, which represents more than 8,000 electrical workers in Alberta, offers an alternative approach — building more refineries at home.

"Upgrading and refining oil sands bitumen here in Alberta would mean thousands of jobs in construction, maintenance and supporting industries and businesses," MacKenzie said. "Getting full value for the resource makes sense, but it will take a concerted lobbying effort from the public and organized labor to make it a reality."

The IBEW points to the North West Redwater Partnership, a joint project of North West Upgrading Inc. and Canadian Natural Resources Ltd. The $10 billion complex, north of Edmonton, would refine 50,000 barrels of bitumen per day.

Local 424 already has 50 members on site. At the peak of construction, the project will require more than 1,200 IBEW electricians.

"We could certainly benefit from more projects like this," MacKenzie said.

East Coast, West Coast Energy Fuels Jobs

While the prairies are facing a slowdown in energy production and development, both Atlantic Canada and British Columbia may witness an energy boom in the next decade.

The Deep Panuke offshore gas field, which went online in 2013, is driving energy exports from Nova Scotia. And that's only the beginning, says Halifax Local 625 Business Manager Tim Swinamer.

BP and Shell are exploring the possibility of building more oil and gas drilling stations in the Atlantic.

"We've always done offshore work," Swinamer said. "So it will be great for us if they happen."

IBEW members on the East Coast are also getting ready for the construction of the first phase of the Maritime Link: 170 kilometers of transmission cables that will transport power produced by the Muskrat Falls hydro dam in Labrador to customers throughout Atlantic Canada and the Northeast region of the U.S.

The first part of the massive project — building transmission lines to transport power to homes in Newfoundland and Labrador — is underway.

Still, jobless rates in the east remain higher than average, with unemployment in Nova Scotia hitting a 16-month high last July, reported the Daily Commercial News in September.

But continued oil and gas explorations, plus major federal projects like the $300-million modernization of the Halifax Shipyard is expected to boost growth — and construction work — in 2015.

Meanwhile British Columbia is gearing up for billions of dollars in natural gas work.

Shale drilling, which sparked the U.S.'s natural gas boom, is underway in the province's Northeast region, home to the Horn River and Montney Basins.

The saturation of the U.S. market with natural gas means the future of B.C.'s gas industry lies east with the emerging economies of China, India and Southeast Asia.

To meet this need, energy companies have proposed more than a dozen liquefied natural gas export facilities throughout the province.

Liquefied natural gas, or LNG, is natural gas converted to liquid form for ease of transport.

These projects are still on the drawing board, and numerous regulatory hurdles must be passed before work can start.

But even if only half of these plants break ground, provincial authorities expect a potential labor shortage. BuildForce Canada, a construction industry think tank, says that British Columbia will see a 26,000-worker gap over the next decade.

The challenge, says Vancouver Local 213 Business Manager Adam Van Steinburg, is educating elected officials and industry leaders about the importance of partnering with the building trades to guarantee that these jobs will be manned by the best trained workers in their fields.

"You can't just wait until the last minute and flood the market with apprentices or low-skilled foreign workers," he said.

Despite past tension between the ruling Liberal Party and organized labor, both the B.C. and Yukon Territory Building Construction Trades Council and the B.C. Federation of Labour sat on Premier Christy Clark's LNG working group, which issued a report last spring on how to meet the training and workforce challenges posed by natural gas.

Its recommendation: start preparing now for the inevitable skills shortage.

This includes boosting training opportunities by leveraging existing government and union programs and identifying potential recruits to the trades now, particularly those from underrepresented demographics like women and First Nations members, and pairing them up with working journeymen to provide mentoring and on-the-job training.

Van Steinburg says many companies have come to realize through experience that relying on low-paid, undertrained workers to fill the gap leads to busted budgets, delays in completion and on-the-job accidents.

"Even the nonunion employers get it," he said. "They don't want to lose money."

Canada should also look to the United States for skilled workers, says Christopher Smillie with the Canadian building trades.

"Canada is faced with finding 300,000 or so skilled workers to meet economic demand and retirements over the next 10 years," he wrote at the Huffington Post. "I can think of no better source country for skilled workers than the United States while we are busy training our young people and refocusing our education system."

First District Vice President Bill Daniels says that the IBEW's top-notch training and commitment to on-the-job excellence makes it a natural partner for both businesses and government officials in finding solutions to Canada's skills trades crunch.

"These projects represent a huge opportunity for the country and the economy, but they can't be done without the experience and know-how that comes from quality union labor," he said.


Photo Credit: Syncrude


Photo Credit: Government of British Columbia

The oil sands in Alberta, top, are experiencing a slowdown due to low oil prices, but the natural gas industry is expected to see major growth in British Columbia, where provincial officials, above, are scoping new sites for liquefied natural gas facilities.