Frontlines

When the oil machine rolls into town

Wayne Skene January 15 1979
Frontlines

When the oil machine rolls into town

Wayne Skene January 15 1979

When the oil machine rolls into town

A classic 1960s confrontation is being played out these days in Northern Alberta, pitting the birds and bunnies people (the environmentalists) against a seemingly insensitive multinational corporation (in this case, Esso Resources Canada Ltd., a wholly owned subsidiary of Imperial Oil Ltd., Cana-

dian offshoot of Exxon Corp.). On its resolution hangs the potential to dramatically reduce Canada’s dependence on foreign oil—but at a social cost that some residents of the Cold Lake/Grand Centre / Bonnyville area, 125 miles northeast of Edmonton, consider unacceptable.

The decision on whether Esso Resources should go ahead with its plans to build a $4.7-billion oil sands plant at Cold Lake now rests with Alberta’s Energy Resources Conservation Board, which opened hearings in Grand Centre last month and is scheduled to sit until mid-January. Its recommendation will go to the Alberta cabinet for final consideration. Even before the hearings commenced, the issue was muddied by the appearance in the district of “Fort McMurray stories,” horrific, sensational tales of a terrible fate said to have befallen that community, some 150 miles further north, with the arrival there over the past few years of the huge Syncrude oil extraction program. Crime rates increased 68 per cent during the construction of that plant; and stories of venereal disease, drug and alcohol abuse, axe murders and child molesting have lost nothing in the telling around Cold Lake.

Nevertheless, like every good ’60s

tale, there’s a powerful argument on the “growth” side and most Cold Lake residents (a Gallup poll says 71 per cent) want the plant built, scare stories or no. It could create 6,500 permanent jobs in Alberta and bring the three levels of government $21 billion in direct revenues ($9 to $10 billion to the already wealthy province). Consequently, Esso Resources is gambling that when the rhetorical dust settles, it will get a goahead. (Since 1964, Esso has spent about $70 million on pilot projects in the area and has concluded that the plant could halve Canada’s need for foreign oil. The plant would produce

160.000 barrels of raw bitumen (heavy oil) daily—by injecting steam some

2.000 feet below the surface—then upgrade the oil into light, synthetic crude.)

With the involvement of local residents, businessmen and government officials, the hearings have been designed to assess not only the potential environmental impact of the project, but the social and economic effects as well. From day one, the battling oratory of the environmentalists has been echoing off the panelled walls of the meeting

room in Grand Centre’s Tropicana Dine and Dance Hall. Concerns range from potential damage to the area’s beaver population to what level of sulphur emissions were deemed acceptable, to how much of the area’s fresh water supply the facility should be allowed to use (its estimated daily requirement for steam processing is equivalent to that of a city of 55,000).

And while local citizens have been airing their concerns over the potential social impact of the huge plant and its imported workers, the province and the three towns concerned (Cold Lake, Grand Centre and Bonnyville) have been punching each other out in the corner. Fears over who will be stuck with the multimillion-dollar tab for new schools, hospitals, roads, utilities and expanded police protection if the population leaps from 12,000 to an anticipated 54,000 by 1986 are not easily soothed by the province’s verbal assurances of financial support. Municipal officials, with visions of having to an-

nounce frightening increases in property and business taxes, are mindful of past provincial “assurances.” (For example, a 1965 request to upgrade Cold Lake’s hospital facilities with provincial assistance has yet to be settled.) They have demanded a commitment in writing—an attitude derided by the provincial energy minister, ex-Edmonton Eskimo quarterback Don Getty, as “un-Albertan” (as in lacking team spirit). Says Cold Lake Mayor Doug Wold: “Talk is cheap.”

As the arguments rage, Esso Resources has remained strangely inconspicuous by comparison. Although company officials were always present at the hearing and were continually under question, the real heavy has been the province. In what Esso officials feel is an international first, extensive advance studies on the environmental, social and economic impact were begun almost the moment the company announced its intention to build the plant in November, 1977.

The economic impact of Esso’s decision to proceed with the plan is already evident. House prices in Cold Lake have escalated almost overnight from an average of $40,000 to $70,000 and some commercial lots have jumped 700 per cent in price. Cold Lake is the smallest but the most affected of the three communities and the value of its building permits has leaped from less than $750,000 in 1976 to more than $6 million in 1978. But when it comes to the social cost of the project, the Cold Lake region has a decided advantage over Fort McMurray. “All three towns are well established with their own lifestyles, industries and societies,” says Don Appleby, chairman of the region’s Community Advisory Committee. “We’re not instant towns like Fort McMurray was.”

With some recreation and health facilities already in place and more planned, along with the home and industrial construction, Cold Lake should escape most of the Inaror of boom development. “The key is preparation,” says Mayor Wold. “Adequate preparation requires gurantees from the province in the form of low-interest loans or even grants from the Heritage Fund,” Alberta’s multimillion-dollar treasure chest accumulated from a booming oil economy. The reasoning of town fathers is convincing: if the Cold Lake region is being asked to bear the social cost of a project which will benefit not only Alberta but all Canada, then it’s not too much to ask for a little help from their friends.

Wayne Skene