The Rock's most precious resource
Gordon Pitts
Rushoon, Nfld. — Globe and Mail Aug. 12, 2009
As a 17-year-old with an adventurous spirit, Ann-Marie Cheeseman spent part of last summer driving 40-ton trucks in the Alberta oil sands. She made big money for a Newfoundland teenager, clearing close to $3,000 a week.
But she doesn't want to return to the oil sands, leaving her family and friends in the harbour village of Rushoon on the wild, beautiful Burin Peninsula. “I'd go back to Alberta only if I had to,” she says firmly.
So this summer, she is on a mission – to stay in Newfoundland and Labrador and build a career in what she believes will become a booming province over the next 20 years. She is learning the electrician's trade at a college down the highway from Rushoon.
If everything falls into place, she would thus reverse the century-long exodus of Cheeseman family members who have left the remote Burin, a three-hour drive west of St. John's, in search of work in other parts of the world.
Ms. Cheeseman's choice is a barometer of the new spirit in the province – that this is its moment, with the economic balance tilting eastward in a tectonic shift as Central Canada declines, Alberta passes its peak, and Newfoundland and Labrador strikes pay dirt in oil, mining and electrical power.
That means the chance to turn the tables on Canada's condescension. “What I'd like to say to the rest of the country is: ‘Come on down, we've got a job to offer you,'” says Ms. Cheeseman's father, Jim Cheeseman, 59, who has worked half his life outside the province – in Ontario, Alberta, wherever the jobs are.
The Rock can still be a hard place if you're in the savaged forestry industry or the depleted cod fishery. Unemployment, chronically double digit, rose above 17 per cent last month, a level that partly reflects the persistent culture of seasonal employment, rural hardship and government handouts.
Yet the optimism seems almost to defy gravity as the province emerges from 60 years of dashed dreams since the former British colony joined Confederation. It is buoyed by a combative Premier and new energy deals, including the recent Pembina South agreement with major oil companies that will net $10-billion for the province – which also becomes a 7.8 per cent partner in the field.
Ms. Cheeseman intends to be part of the surge. “I want to work at Long Harbour,” she says with determination, referring to Vale Inco's planned facility for processing nickel from its Voisey's Bay mine.
The vision outlined by Premier Danny Williams is to see a constant rotation of megaprojects – Long Harbour, Hebron, White Rose, Hibernia South and others – rolling out at staggered intervals to 2041, when the lopsided deal enjoyed by Quebec for power from Labrador's Upper Churchill project finally ends.
“We are about 30 years away from 2041, which is the magic date for people in this province,” Mr. Williams says. “That's the date we get back 5,000 megawatts with the Upper Churchill.”
Part of the mood shift also reflects the depth of anxiety elsewhere – in Ontario, Quebec, even Alberta, which traditionally employs an estimated 30,000 to 40,000 current or former Newfoundlanders, but is now sending many home for long layoffs.
This creates a paradox of declining provincial GDP because of lower energy prices, but also soaring house prices in St. John's and other centres. Even in the Burin, which has been hit by instability in the fishery and shipbuilding trades, housing has held up.
This year, Toronto-Dominion Bank economist Pascal Gauthier writes, Newfoundland and Labrador should generate a nation-leading 16.5-per-cent surge in house prices.
It comes largely “from net in-migration into St. John's and elsewhere on the Rock as fortunes in Alberta's oil patch have turned and workers hope to use their skills towards upcoming energy projects in the province.”
Kevin Farewell, a former Windsor, Ont., auto worker helps out around his parents home in Marytown while waiting to start training for a new career.
A long wait for prosperity
Newfoundlanders know there is a severe global recession, and many are hurting. But they see it as a blip in a long history of rise, fall and rise again.
“Newfoundland has been in a recession for 400 years,” says Jerry Byrne, president of the St. John's engineering firm D.F. Barnes Ltd. “Five years ago we started coming out of it, and I was born 25 years too early.”
By that reckoning, Ms. Cheeseman was born at the right moment, reaching adulthood in time to realize the prosperity that was denied earlier generations of Cheesemans. It should allow her to remain in Rushoon, a settlement built around a long graceful harbour and rushing stream, where, in a population of about 300, you are either a Cheeseman, related to a Cheeseman, or living near one.
Prosperity would reverse 180 years of history that began when John Cheeseman, from Kent, England, ventured into Rushoon harbour and settled his family there.
The village enjoyed a population explosion in the 1960s when Joey Smallwood's resettlement projects drew families off nearby islands, but in recent decades, the numbers have declined as young people left to find work.
The Cheesemans have a history of adventure, and tragedy. The vicious gale of August, 1927, killed two dozen fishermen on Placentia Bay, including Captain Danny Cheeseman, whose schooner, the Hilda Gertrude, capsized with all seven crewmen lost.
As the fishery declined, this appetite for adventure took Rushoon men afield on work crews for the Canadian Pacific Railway.
One May morning in 1980 on a Saskatchewan highway, a drunk driver swerved into the passing lane and collided with an oncoming truck, setting off a chain reaction that destroyed a bus carrying 30 CPR workers, many of them from Placentia Bay.
Four Rushoon men were among the 22 dead, including Jim Cheeseman's brother Mike, who was 22. Jim gets quiet when he talks of the accident, and admits that for a time, Rushoon people hesitated to travel so far afield for the CPR.
But the wandering spirit returned, as Fort Mac and its oil sands became the favoured destination. In recent years, they have travelled in waves from places such as Rushoon, Parker's Cove, Fortune and Marystown, the biggest centre on the Burin Peninsula.
Sam Synard, mayor of Marystown, estimates that in a peninsula population of 20,000 people, as many as 3,000 work away. It is not an easy life, despite the good wages that can allow 20-year-olds to become wealthy by Newfoundland standards.
The peculiar institution called “the turnaround”– often, three weeks in the oil sands and 10 days back home – is hard on families. In addition, “there is so much drugs and stuff in Fort McMurray,” Ms. Cheeseman says, and, as a young woman, she felt uncomfortable walking downtown at night.
People are still going west, even though the Alberta oil economy is suffering. Over the decades, Burin migrants have put down roots in Fort Mac and other oil centres. That creates useful contacts for people like Bev Cheeseman, a Rushoon resident who is in Fort Mac cleaning offices and living in her brother's house, while son Brandon works as a pipe fitter on Imperial Oil's Kearl Lake project.
She sees a big change this year – fewer Newfoundlanders, and fewer companies paying for the flight from St. John's to Fort McMurray, leaving the workers to absorb the expense. But she is skeptical that Newfoundland is ready to pick up the slack. “There's just nothing starting up yet,” she says.
The other problem is the Newfoundland renaissance is spotty in terms of actual corporate activity. Despite some promising pockets, the fishery remains a social instrument rather than a real business, and pulp and paper has been hammered.
“It's the multinational oil companies and the spinoff welding companies that benefit,” says Trevor Adey, a high-tech entrepreneur who speaks with added bitterness. His software company, Consilient Technologies, closed its doors late last year, a victim of the financial crisis and the slowness with which markets opened for its wireless applications products.
Mr. Adey says the “regional peculiarities” in Canada's financial system – mainly, the difficulty in funding growth strategies by companies in Atlantic Canada – continue to hamper the province's diversification, particularly in high technology.
Paddy Furey sells fish in a parking lot in Marystown.
Compass pointing east
Contrast his take with that of Jerry Byrne, who insists the boom days are here. His engineering and fabrication company employs 60 Newfoundlanders in Alberta, down from 300 at the peak. But his Newfoundland work force, at 350 to 400 people, has remained stable and now, as the resource projects ramp up, “our challenge will be the skill shortage.”
That is certainly the hope of Kevin Farewell, whose life story encapsulates Canada's recent economic history. The son of a forestry worker, he left the Burin as a teenager and headed to Ontario. He married, raised kids and hit the jackpot – a job in the booming auto industry, working in the Ford engine plant in Windsor.
“People told me I had hit the lottery – it would be 30 years and out,” he says. But after 12 years in the plant, the bottom fell out of the auto economy and he lost a job that paid $33 an hour. Mr. Farewell, 46, has been laid off a year, and is about No. 800 on the callback list with little hope of seeing a regular paycheque from Ford again.
But having lost out on the great Ontario lottery, he is buying a ticket on a new one: the vision of a prosperous Newfoundland. He has been home in Marystown, where he still has family, including parents in their 80s, with a father in ill health.
Like Ann-Marie Cheeseman, he plans to train as an electrician (with money from employment insurance and Ford), get a job in the energy industry and build a house. Even if he has to scrape a bit, it's better than Windsor, where his home there is losing value. “I have to start over again somewhere,” he says. “I have no choice.”
Besides, he likes Danny Williams's in-your-face refusal to give things away. For too many centuries, Mr. Farewell believes, ordinary Newfoundlanders surrendered control of their resources – to the English merchants in St. John's, to global companies, to the federal government. In his view, the Premier is fighting for people like him.
But the dream has complications. Mr. Farewell's wife, Lila, who emigrated with her family from Argentina 30 years ago, has her own family in Windsor, and their two children, in their early 20s, are just getting started in life. “I want to see them succeed,” she says.
It is nice for Mr. Williams to talk about workers coming home, but can he deliver a future for Kevin Farewell? “I'm not a miracle worker,” the Premier says, “but by the same token, people like him are looking at our track record over the last four or five years and we have delivered in spades.”
The Premier may have taken on Ottawa and stood up to the oil companies, but his biggest enemy may be the rural cycle of seasonal work and government assistance. He says the answer lies in engaging the hearts and minds of people in their teens and twenties. The province has a youth-retention strategy that involves learning what young people think.
But to take the next leap, Newfoundland needs to direct revenues from energy projects into businesses that will sustain the province when the oil runs out. Mr. Williams says that transfer is under way, although an ambitious stimulus package has taken a front seat recently.
Derek Rowe, a veteran entrepreneur in St. John's, says that in the absence of strong private funding, government has to support companies beyond the startup phase. He is now chairman of Marport Deep Sea Technologies Inc., a St. John's company developing underwater sonar devices, the kind of ocean technology the Premier is touting.
“You will have failures – winners and losers,” Mr. Rowe says, pointing to Mr. Adey's experiences with Consilient as typical of the process. But after some disastrous forays in backing new ideas, such as the hydroponic cucumbers scandal of the 1980s, the provincial government is leery of risk.
“Don't be afraid,” Mr. Rowe urges. The Premier is famously fearless, but the challenge of diversification could be his ultimate test.
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