New life for Kitimat on horizon
B.C.'s No. 3 port could become energy hub
CanWest News Service
Sunday, November 18, 2007
Fisherman Charles Wilson is a member of the Haisla First Nation who lives in Kitamaat Village.
The peaceful shoreline along this arm of the Douglas Channel offers few hints of the energy hub it could one day become.
An eagle swoops across the water before perching on one of the piles of driftwood that have washed on the rugged beaches. Farther out, seals can often be seen bobbing among the waves, following schools of salmon.
By next year, the first of several moorings for a terminal to import liquefied natural gas, the first of its kind on Canada's West Coast, could be anchored in this small cove.
As early as 2010, giant tankers will berth at the facility to unload the super-cooled gas destined largely for Alberta's growing oilsands industry thousands of kilometres away.
The project is one of several oil-and-gas proposals for Kitimat, a shrinking community on B.C.'s northwest coast, that could ultimately catapult the province into a new role in the global energy market.
In addition to LNG to feed growing oilsands needs, there are plans to bring at least two oilsands pipelines to this underutilized port that could open shipping routes to new markets such as Asia.
It is raising hopes those projects could eventually form the backbone for a new oil port -- complete with upgraders or refineries -- returning stability to a once-prosperous region.
"This is an exciting time for northwestern B.C.," says Roger Harris, executive director of the Kitimat Port Development Society, a group of local businesses, government officials and First Nations aiming to expand the existing facilities. "It has the potential to bring in new industries not here today."
Kitimat's fortunes have always been tied to Alcan's giant aluminum smelter, first built in the 1950s and the main reason for the community carved out of the rugged terrain that surrounds it.
The plant is still the largest employer in the community, once a model of urban planning designed to support as many as 50,000.
That goal went unrealized. After Alcan's workforce topped out at about 2,700 employees in the 1970s, the company went through a succession of layoffs. Kitimat's residents started to pack up and leave.
The community recorded the largest population drop in Canada in the last census -- falling nearly 13 per cent to below 9,000 people from about 10,285 in 2001.
And a halt to the exodus appears unlikely in the short term. Alcan has proposed a
$2-billion overhaul that would boost production by about 40 per cent, but the upgrades will mean an end to another 500 well-paying jobs, leaving about 1,000.
The district has tried to attract other industries to its deep-water port, also home to EuroCan's pulp-and-paper complex and Methanex, which closed its methanol plant last year.
There are currently more than $15 billion worth of projects -- mostly energy development backed by Calgary-based companies -- proposed for the Port of Kitimat, which is B.C.'s third-largest port, far behind Vancouver and Prince Rupert.
Not all will go ahead. In fact, several have already been postponed or delayed.
Already a year behind schedule, construction on the $700-million LNG plant is tentatively slated to begin for 2008, as the company has yet to secure a supplier.
"Assuming that we can confirm LNG supply, then we'll go ahead with construction next year," said Rosemary Boulton, president of Kitimat LNG, based in Calgary. "In the last 12 to 18 months, the LNG supply has become quite short and that's just due to increasing demand in the Asia market."
Some of the biggest development hopes were pinned on Enbridge's Gateway Project, aimed at opening Canada's oilsands to
China, the world's second-largest energy market. That project was originally expected to start pumping up to 400,000 barrels of oil to the West Coast as early as 2010.
But late last year, the pipeline operator shifted its attention to other proposals to move oilsands production to the southern U.S. and put Gateway on the back burner as interest from Chinese partners ebbed.
The oil-and-gas development is fuelling fears about a proliferation of tanker traffic along the province's coast. Environmental groups argue the massive tankers have no business travelling in the pristine and wildlife-rich waters, which they believe are protected by a more than three-decade-old moratorium on such traffic.
"The primary beneficiary of these projects is not British Columbians -- it's Albertans and Americans," says Will Horter, executive director of the Dogwood Initiative, a Victoria-based activist group that has been leading a petition drive opposing tankers. "We're basically putting the whole coastal economy, in addition to the ecosystem, at risk to benefit other people."
But that sentiment has found less traction along the channel's shores, where the Haisla First Nation is seeking to take part in proposed projects in the hopes of sharing in the economic benefits while gaining some control over the potential environmental impacts.
When its chief, Steve Wilson, looks across the waters at the undeveloped land, he sees a future for his people.
The LNG terminal will be built on land owned by the Haisla. Many of its nearly 1,600 members live in Kitamaat Village, located across the channel's waters. Under the agreement, the band receives a five-per-cent stake in the project and tax revenues, plus employment and contract opportunities.
"What's been happening in the past is we've been kept out of it and the wealth and employment has gone to everybody else," says Wilson. "When I look at it, I see a lot of opportunity."