Credible Conversations panel: Will new oil pipelines benefit BC businesses?

Panel BC biz and pipelines

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Our first Credible Conversations forum was held on May 29th at the Creekside Community Centre in Vancouver. Over 100 business leaders, entrepreneurs, politicians, First Nations representatives and BC residents came together to discuss the economic risks of pipeline expansion and explore how to build a more diversified economy here on the west coast. Over the next few days, we will be posting videos, photos and presentations from the forum here on our blog.

Will BC businesses benefit from new oil pipelines?

The first experts’ panel explored the economic impact of oil pipeline development on the province’s economy as a whole.

Moderated by Mandy Nahanee from the Squamish Nation, panelists included Karen Campbell, a staff lawyer with Ecojustice, Wes Regan, CEO of the Hastings Crossing Business Improvement Association, and Ngaio Hotte, an economist with the UBC Fisheries Economics Research Unit.

Watch the full discussion here:

And here are the slides used by Ngaio Hotte in her presentation. A more detailed analysis can be found on the UBC Fisheries Economics Research Unit “talking fish” blog.

Slide1 Slide2 Slide3 Slide4

 

Credible Conversations presentation: BC economic snapshot + pipeline risks

CredConvo tech breakout group

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Our first Credible Conversations forum was held yesterday at the Creekside Community Centre in Vancouver. Over 100 business leaders, entrepreneurs, politicians, First Nations representatives and BC residents came together to discuss the economic risks of pipeline expansion and explore how to build a more diversified economy here on the west coast. Over the next few days, we will be posting videos, photos and presentations from the forum here on our blog.

To kick things off, here’s Liz McDowell giving a snapshot of BC’s economy and sharing some of CRED’s research to date:

And here is her presentation:

Slide01 Slide02 Slide03 Slide04 Slide05 Slide06 Slide07 Slide08 Slide09 Slide10 Slide11 Slide12 Slide13 Slide14 Slide15 Slide16 Slide17 Slide18

Download the presentation slides

Notes from the real estate stream

Group question

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Our first Credible Conversations forum was held May 29th in Vancouver. Over 100 business leaders, entrepreneurs, politicians, First Nations representatives and BC residents came together to discuss the economic risks of pipeline expansion and explore how to build a more diversified economy on the west coast. 

*These are rough notes from the break-out sessions and are not meant to convey the opinions of all CRED members, or even all participants in the break-out group.

How could a new oil pipeline affect the real estate and property development industries?

Costs/risks:

  • Value of homes detrimentally impacted
  • Risk to property values
  • Affects Vancouver’s brand
  • Vancouver becoming a “petrol-port”
  • Health impacts – fumes from trucks and tankers
  • Harbour view affected

Benefits:

  • Kinder Morgan media plugs help raise awareness about the region
  • Kinder Morgan is reaching out to community regarding their proposal
  • Economic growth = population growth, more development, higher real estate values
  • Increased tax income to pipeline municipalities

Information needed:

  • How much do people value the Vancouver brand?
  • At what point is the impact too much to be allowable?
  • How long does it take to recover from an oil spill?
  • Is it possible to completely recover from an oil spill?
  • What are the economic costs of environmental degradation i.e. airshed quality?
  • Can Vancouver still be the “greenest city” if the project goes ahead?
  • How much would it cost to insure the pipeline without government coverage?
  • What / how many / for how long will new jobs be around for?
  • Will the pipeline attract people to move to Vancouver?
  • How would an earthquake affect the pipeline / tankers?

 

Notes from the tech, digital and creative stream

CredConvo tech breakout group

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Our first Credible Conversations forum was held May 29th in Vancouver. Over 100 business leaders, entrepreneurs, politicians, First Nations representatives and BC residents came together to discuss the economic risks of pipeline expansion and explore how to build a more diversified economy on the west coast. 

*These are rough notes from the break-out sessions and are not meant to convey the opinions of all CRED members, or even all participants in the break-out group.

How could a new oil pipeline affect the tech, digital and creative industries?

Costs / risks:

  • Environmental damage
  • Brand risk to Vancouver
  • In general, not enough is known on the risks to tech/film

Information needed:

  • Need reputable, accessible information available through a central resource
  • Need a clear outline of the risks
  • Case studies, surveys
  • More understanding of the alternatives / solutions
  • Solution-focused, with outline of clear actions to take
  • Look to industry to take a position
  • Key spokespeople
  • Information for parents: what are the risks to children?
  • Need tools: advocacy, outreach, socialization

Where are the opportunities to support this sector?

  • Education
  • Ride-share programs, electing to go car-free
  • Platforms for easy communication sharing that supports more low-carbon lifestyles
  • Crowd-funding opportunities for start-ups
  • Creative solutions
  • Online training platforms
  • Opportunities for online conversations that bring more people into the discussion and maintain it beyond events like this

Notes from the cross-sectoral stream

Cross sectoral group

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Our first Credible Conversations forum was held May 29th in Vancouver. Over 100 business leaders, entrepreneurs, politicians, First Nations representatives and BC residents came together to discuss the economic risks of pipeline expansion and explore how to build a more diversified economy on the west coast. 

*These are rough notes from the break-out sessions and are not meant to convey the opinions of all CRED members, or even all participants in the break-out group.

What does cross-sectoral mean?

  • Interdisciplinary, multifaceted, coming from different perspectives
  • Inclusivity and diversity, bridge between cultures
  • How sectors can work together
  • Shared interests, big picture
  • Directing forces and ideas
  • Common / shared interests, collaboration
  • Includes unions

How might a new oil pipeline affect the west coast’s economy?

Costs/risks:

  • Increased reliance on foreign investment
  • Risk of skills drain
  • Free trade deals (contradictions)
  • No local energy security plan
  • Chevron jobs at risk?
  • Climate change risks
  • Costs of oil spills – insufficient insurance, tourism/cruise ships, attracting talent
  • Kills innovation in alternative energies
  • Impacts the region’s livability
  • No long-term benefits locally

Benefits:

  • Lower taxes, more funds for health care & education
  • Jobs: construction, oil sands jobs
  • Strength of Canadian economy – global position as resource leader
  • Strengthen trade relationships with the US, China
  • Increased global oil supply
  • Pipelines are cheaper and safer than rail or road transportation
  • Return on RRSPs / equity market will benefit

Information needed:

  • What does a transition away from oil dependence look like as opposed to a crash?
  • Where else could tax revenues come from? (Carbon tax?)
  • More conversations on the oil economy vs the green economy
  • Need to break through the spin
  • Are people intimidated to speak up against real or perceived business interests?

Notes from the tourism & hospitality stream

Tourism group

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Our first Credible Conversations forum was held May 29th in Vancouver. Over 100 business leaders, entrepreneurs, politicians, First Nations representatives and BC residents came together to discuss the economic risks of pipeline expansion and explore how to build a more diversified economy on the west coast. 

*These are rough notes from the break-out sessions and are not meant to convey the opinions of all CRED members, or even all participants in the break-out group. 

What are the impacts of new pipelines on the tourism and hospitality industry?

Costs / risks:

Risks of increased tanker traffic

  • Marine life impacts
  • Visual pollution
  • Impact on kayaking and canoe tours
  • Impact on the brand of Vancouver

Risks of an oil spill along the coast

  • Could decimate fishing and coastal tourism
  • Decrease in fish stocks can be irreversible – example of Saskatchewan vs Alberta management of recreational fishing and fish stocks
  • Would hurt BC’s reputation as a pristine visitor destination
  • Impact on cruise ship traffic

Benefits:

  • Increased funding for arts and cultural activities from resource company marketing budgets
  • Potential to develop industrial tourism around the Westridge Marine Terminal

Information needed:

  • With the new pipelines, what does a business as usual scenario (i.e. increased tankers, no spills) look like?
  • What is the cumulative risk of small spills over time?
  • How will increased tankers impact salmon, orcas and other marine life?
  • Need common industry definitions of small, medium, large sized spills that are used consistently
  • Can tiers of impact be created in advance so that it’s clear what’s happening in the case of a spill and what the response should be?
  • Do funds need to be set aside for a big marking campaign promoting Vancouver as a destination in the case of a spill?
  • In the case of a spill, what would be recoverable and what would be the recovery time? (i.e. on small businesses)
  • What is the tourism industry’s exposure to transportation risk, considering the methods of transportation visitors use to get to the area?

What are the practical opportunities to support a more diversified economy?

First Nations-led tourism:

  • Popular with visitors looking to learn about indigenous culture
  • Can promote economic justice and increase tourism revenues at the same time
  • Opportunity for First Nations to reconnect with their culture
  • Eg Meares Island tree walk in Tofino, managed by the Tla-o-qui-aht First Nations

Promote nature-based tourism in an urban setting:

  • Very few places in the world have the same juxtaposition as BC’s south coast
  • Half of the province’s tourism jobs are in the Lower Mainland
  • In the future, job shortages in tourism are predicted
  • Can learn from others: i.e. New Zealand’s eco tourism-centered strategy that involves many stakeholders from local governments to Maori groups

Make sure not to become overly reliant on tourism – places like Tofino, for example, are already very dependent and wouldn’t benefit from a stronger reliance on just one industry for their economic growth

Tourism industry impacts: the Deepwater Horizon spill

http://media.npr.org/assets/news/2010/07/01/tourism2-20b35fceb8e9f0cd6372e304d0b9ad995add2d8c-s6-c10.jpg

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CRED is currently undertaking research to assess the risks to the tourism industry of an oil spill along BC’s west coast. Although it is far too early in our research to draw conclusions, here are some initial thoughts on the ways that the Deepwater Horizon spill affected tourism in the Gulf states.

In April 2010, the largest accidental marine oil spill in history occurred in the Gulf of Mexico, when the Deepwater Horizon oil rig exploded and approximately 4.9 billion barrels of oil poured into the Gulf of Mexico over the three months that followed.

Although this is certainly a worst-case scenario, the experience of the Gulf states can be instructive when trying to get a picture of the costs and benefits of expanded tanker traffic in BC’s coastal waters. Both the Gulf states and southern BC have highly populated coastal areas and a thriving tourism industry that is a significant regional job creator (127,000 people are employed in tourism in BC, the vast majority in and around Vancouver).

Tourism: vulnerable to public perception

When an oil spill occurs, not only are tourist destinations directly affected in areas where the spill has flooded land, washed up on beaches, or permeated the air with a strong odour, but the tourism industry also faces serious reputational impacts. Public perception strongly influences people’s decisions whether to visit and spend time in a particular community. In the Gulf of Mexico, sections of coastline that never saw oil wash up on shore were nonetheless affected by public perceptions of the Gulf states as contaminated.

A study commissioned for the Louisiana Office of Tourism two months after the Deepwater Horizon explosion had the following key findings:

  • The spill had a negative impact on people’s intentions to visit Louisiana: 26% of people who had previously intended to visit the state had postponed or cancelled their trips.
  • Perception overshadowed actual impacts: a quarter of people thought that leisure activities (swamp tours, boating and hiking) were closed because of the spill when in fact this was not the case.
  • The seafood industry was particularly impacted by perceptions: for example, over half of people surveyed thought that Louisiana oysters were unsafe to eat although evidence demonstrated otherwise.
  • 44% of respondents thought the oil spill impacts were the same or worse as the 2005 hurricanes (including Hurricane Katrina).

Net negative impact on hospitality

In August 2010 the Knowland Group carried out a survey of the spill’s impacts on the hospitality industry across Louisiana, Alabama, Mississippi and Florida. They found that although hotels experienced a short-term upward surge in bookings from oil cleanup crews, the net impact in the two months following the spill was negative. Their key findings:

  • By June 3rd, 60% of hotels surveyed had experienced cancellations
  • In the same time frame, 42% of hotels began to experience difficulty booking future events.
  • Transient business associated with the spill cleanup made up for rooms typically booked by tourists or meeting attendees. However these rooms were often booked at a discount.
  • Overall, lower room revenue coupled with unoccupied meeting space and empty restaurants, meant lower revenue than if the rooms had been booked by typical visitors.

Small businesses faced the biggest long-term impacts

A survey of over 200 million small businesses carried out in 2011 by Dun & Bradstreet found that small businesses are particularly vulnerable to natural disasters. Their findings indicated that:

  • The oil spill in the Gulf of Mexico had the potential to impact 7.3 million businesses throughout Alabama, Florida, Louisiana, Mississippi, and Texas, affecting 34.4 million employees and $5.2 trillion in sales volume.
  • According to the Institute for Business and Home Safety, “an estimated 25% of businesses do not re-open following a major disaster”.

Although the long-term impacts are still unfolding, at least one researcher has found small businesses to be most strongly impacted. Two years after the spill Mark Bonn, a tourism industry expert and researcher at Florida State University, commented that “both the resorts and the budget hotels in Northwest Florida have rebounded and are doing well, but the support industries are still struggling. Some of the mom and pop restaurants, gift shops, and the charter boat and watercraft rental businesses have really struggled, and many of them just didn’t make it.”

Questions CRED is hoping to answer

As we continue with our research, we plan to move beyond looking at what’s happened elsewhere to modelling what might happen in Vancouver.

Here is our working list of questions to address. We warmly welcome additions, clarifications and challenges to our thinking- if there are other relevant questions you’d like us to investigate or if you wish to suggest modifications to the list below, please post in the comments to this blog.

  • If there was a large oil spill in or around Vancouver’s waters, what impact on tourism could be expected? What about if there was a medium-sized spill?
  • What kind of government spending would be needed to help counter negative public perception and bring tourists back?
  • How long-lasting would the impact likely be?
  • How many jobs would be likely to be affected?
  • Which industries within the tourism sector would be most vulnerable?
  • Are there any actions that would significantly reduce risk for the sector?

Photo courtesy of the NPR website

CRED releases independent report highlighting Trans Mountain concerns

IanMeissnerChilliwackFarm

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On Tuesday February 26, CRED released a report highlighting the risks of Kinder Morgan’s proposed Trans Mountain pipeline. In addition to pulling together the most important data about the project’s background, Kinder Morgan’s safety record, and potential impacts of a spill, our group uncovered some of the project’s main economic risks. Some of our key findings:

Jobs: The proposal would create 35 permanent jobs. And oil spill would put at risk industries that together employ over 200,000 people locally including tourism, film and TV, real estate, high tech, agriculture and coastal industries.

Tax revenues: The expansion would not make a significant contribution to provincial tax revenues.

Liability: In the case of a major spill, taxpayers would likely be responsible for the burden of costs, as a company’s liability is limited to $1.3 billion and a major spill could easily cost ten times this amount.

Some of CRED’s advisors highlight the most concerning elements of the report here:

Read or download the full report to learn more about the risks we uncovered.

Thanks to chilliwack360 for the image we used in the banner

The bigger picture: pipelines across Canada

Photo credit: Ewan Nicholson. From Globe and Mail.

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Kinder Morgan’s new pipeline isn’t the only proposal on the table in Canada. Today’s article in the Globe and Mail highlights the six main pipelines under review or planned for the future. Here’s what they say about Trans Mountain:

Proponent: Kinder Morgan

Volume: 590,000 barrels per day (current pipeline is 300,000 barrels per day; expansion will take it to 890,000)

Destination: Burnaby, B.C., home of Kinder Morgan’s Westridge Marine Terminal, where smaller tankers would take Canadian oil primarily to California, although Asian shipments are also possible

State of play: Kinder Morgan is mid-way through an application asking the National Energy Board to approve commercial tolls for the project. A formal application seeking authority to build the expansion is expected later this year.

Decision expected: Depending on when Kinder Morgan applies, the regulatory review could be completed by 2015, with construction starting in 2016 and operations commencing in 2017.

Opposition: Local forces have begun to marshal against the project, including some first nations and the mayors of Burnaby and Vancouver. British Columbia’s provincial leaders – Premier Christy Clark and Adrian Dix, the NDP Leader expected to gain power this year – have not yet made public their thoughts on the expansion.

Pipe dream: TransMountain hopes its route to approval will be less contentious than the Gateway brouhaha, but the line ends at the waterfront near Vancouver and there is much local opposition to the increased tanker traffic it would bring. 50-50, at best.

Read the whole article