Good morning, Chair, members of the committee, fellow witnesses—it's Larry's first time—and guests. It's my pleasure to come to you today to try to give you a “tip of the spear” view of what pipelines writ large mean to regular people in Canada, what they mean to job prospects, short and long-term employment, and how pipelines make a difference right now in the skilled trades in Canada.
We're the Canadian building trades. We represent 14 international construction unions and about 450,000 members here in Canada in the skilled trades. Today I've compiled information from some of our construction employers, the companies small and large who do pipeline construction and maintenance work in every part of this country. I've also compiled information from the trades we represent. Hopefully when I'm finished you'll have an understanding of the importance of these energy assets to the Canadian economy and our folks.
I'm not usually in the habit of using quotes when I appear before committee, let alone Al Gore quotes, but this one hits home. He said: “Why do reason, logic and truth seem to play a sharply diminished role in the way America makes important decisions?”
I hope you'll see that pipelines and related energy projects should be considered in Canada as what Al Gore would call important. They deserve serious consideration. They deserve rational debate on the future of Canada's place in the world energy economy. They deserve more than partisan attacks, blind obstructionism by opponents, and sound bites. These endeavours have real-world implications for working people: paycheques, jobs, and food on the table.
With that said, I learned early on in this job not to assume people have an understanding of what's involved in industrial construction. Being a political science grad and a banker by trade, I had some studying to do myself. So here's the seven-minute summary of what's involved in pipeline construction and what's at stake for Canada.
First, what exactly is a pipeline? By definition, it's a conduit that connects a production source to an interim or ultimate user. But the pipeline is more than a connection for products. The pipeline links together jobs from one end of the production chain to the other end of that chain. The uninformed think a pipeline is just a few short-term jobs, but they're wrong. In the oil sands, for example, petroleum, however defined, is extracted. It can't be stockpiled for very long except in expensive tankage, and it has to move to the next stage in the process.
The extraction jobs and initial processing are 50-year jobs that last for as long as the line is being used.
It moves to an upgrader, where it's turned into synthetic crude oil, or to a combined upgrader or refinery to be upgraded. A large number of high-paid skilled jobs are found here. They are also 50-year jobs, and there are more maintenance and operations jobs created over the lifetime of the plant than there ever were in constructing it.
The synthetic crude goes to a refinery where it becomes products. The same equation is present at the refinery. There are jobs sustaining construction, operations, and maintenance. Those jobs are there for 50 years. Pipelines link those jobs together. If there's no pipeline to markets, those other high-paying, high-skilled, and challenging jobs don't exist. The pipeline moves both the oil and the jobs down the line to the end user. Some of the finished products move in other pipelines back to ultimate consumers.
Pipelines require four major construction activities and four major skilled trades: heavy equipment and side boom operators; back hoe operators to dig and move material; specialty pressure welders to make precise welds so that the pipe is sound and can withstand constant pressure; labourers to provide a myriad of jobs on the line and to coat and protect the pipe inside and out. Teamsters who are represented here today string the pipe before it's welded and lowered into the ditch and operate all manner of vehicles.
The other trades, the ones most think of when they think of construction, build the pumping stations and facilities along the right of way in the same way they do in any other industrial plant. So numbers...that depends on the size of the pipe, the length of the line, the nature of the terrain, and capital investment. For instance for the Northern Gateway—there's been some discussion of that project in this committee—the numbers I ran through job calculators indicate initial construction jobs in the 2,700 range for three construction seasons. Interestingly enough, that agreed with the numbers that the proponent, Enbridge, came up with. Total jobs for a $6 billion project—direct jobs—I calculate in the 12,000 mark.
This makes a bunch of assumptions like any economic model that's used. My major assumption, which I want to share with you, is that the average salary of someone who works constructing pipelines is $110,000. These jobs are top quality, well paying and support working-class families.
Being a pipeliner means that you're mobile. You get on a plane or in your pickup truck—at your own expense, by the way—and you go to where the work is. It means these pipelines are not merely local projects but are national and of national importance to folks in the construction industry. On the four pipeline spreads on the go right now—that's industry lingo for what is being built—in northern Alberta, there were 1,633 employees at the end of last week, and 811 of them were from outside Alberta.
This is roughly the same percentage that is found inside the extraction, upgrading, and refining plants. These jobs are not merely Alberta jobs; they're Canadian jobs. The payroll on those four spreads for the week was about $6 million. From this, it's pretty clear that these projects make a difference across the country. The Northern Gateway pipeline, the Keystone, or Mackenzie—take your pick—are important not only for the initial jobs associated with construction but for the longer-term viability of Canada's place in the North American and world energy market.
Pipelines mean some kind of resource extraction in all of the economic activities associated with those processes. The pipeline job may only last three seasons, but the other jobs—the vast bulk of jobs created—last for 50 years or more. For instance, we represent about 80,000 to 90,000 skilled trade workers who in one way or another in Alberta work in the energy sector. Nationally, approximately 30% of our membership is engaged in oil and gas at any one time.
By the way, we have more than 25,000 apprentices in Red Seal training programs in Alberta alone. The oil sands in our view are a global classroom for Canada's young workforce—25,000 apprentices. Think about that.
If it's not welding pipe at an oil sands plant or doing concrete work or excavation at Kearl Lake, it's building the office towers in Calgary for the energy sector's thousands of employees. Speaking of Kearl Lake, I was up there recently. Do you know that Imperial Oil hired more than a thousand trade contractors, employing more than 18,000 skilled tradespeople? Some 18,000 are on the job today—all to produce products to fill these disputed pipelines.
When opponents to the various pipelines say no to pipeline projects, they're saying no to a broad spectrum of working-class Canada that depends on these jobs to raise families, pay taxes, buy houses and vehicles, spend money in restaurants, and so on. When opponents to the project say no, they're saying no to all the prosperity these things bring to our country and they're saying no to other jobs linked to the pipeline.
In Alberta, the oil sands are being used for unique policy tests for government policy, things we're working on: vital changes to Canada's immigration system, changes to Canada's workplace, health and safety system, and changes to Canada's industrial policy. The list goes on.
In industry, we're testing drug and alcohol programs. We're using multi-employer pension plans for workers and mutual recognition systems for foreign credentials. This list is not exhaustive. We're also trying to work with government to set up a reasonable tax credit for travelling to these national work projects. Without megawork sites that pipelines connect, none of these ventures with our employers and governments would be possible.
The community benefits from Gateway and Kitimat and all along would be exponential. There are a number of other industrial endeavours being planned in northern B.C. Natural gas investment by the likes of Apache and Shell, with each having a more than $5 billion investment, is under consideration. These natural gas projects are also great work opportunities for skilled tradespeople. What an opportunity for Kitimat and natural gas market needs. Gateway would give Canada another market for our oil and not have us beholden to oil politics in the United States.
Suddenly, our natural resource pricing is not dependent on one customer. What a legacy we could leave for future generations and future building trades members. A pipeline from Alberta to Sarnia—that's been discussed in this committee—could make Canada free of imported oil. If this ever made sense in the marketplace, we would certainly support it. The revenues generated by the Government of Canada from future profits is a valuable resource for future generations.
The last time I checked, the cost of health care is not going down. Neither is the cost of funding education. We can't forget where Canada gets revenues for everything we enjoy. It's either from companies paying taxes or people who go to work. Projects like these fund social programs for future generations. Is this what opponents have in mind when they say no? They're in effect saying no to 50-year job creation projects here in Canada. Talk about killing the golden goose.
Before I conclude, there has been some discussion in the media of the regulatory systems surrounding these types of projects. The position of our organization is that we support changes to the system to facilitate large projects, though not at the expense of safety or environmental review.
What we do not support is a 12-year or 15-year regulatory dance that impedes economic development and employment for our members. We don't think pipelines or oil sands facilities should be delayed unnecessarily, nor do we think our country should be subjected to unfettered industrial poisoning. We want something that's fair, streamlined, and rigorous. We live here; our members live here. We won't see the place despoiled for a few paycheques. We leave it up to the committee to talk about the number of changes that could take place in the regulatory system.
I hope I've provided a decent picture of what pipelines mean to the skilled trades. In summary, they mean good-paying jobs for skilled trades for many decades to come, not to mention training opportunities on the pipeline directly and in the oil sands. The pipeline links opportunities and jobs.
I remain available for your questions—and be gentle. Thanks.