REPORTING · 27th August 2012
Last week, on August 17th, David Black made an announcement in Vancouver about a project he calls Kitimat Clean. The project is the construction of an oil refinery situated between Kitimat and Terrace BC.
“My company, Kitimat Clean Ltd, is submitting an Environmental Assessment Application to build a world scale oil refinery at Kitimat BC. The refinery will have the capacity to process all of the output of the planned Enbridge Northern Gateway pipeline. The refinery will be state-of-the-art and designed specifically for processing Alberta oil sands heavy crude oil. We want it to be the cleanest and greenest upgrading and refining site in the world,” wrote Black in a press release last week.
The plant is estimated to be able to process 550,000 barrels of Diluted Bitumen per day, produce 240,000 barrels of diesel, 100,000 barrels of gasoline and 50,000 barrels of Kerosene or Aviation Fuel.
Black explains the plant will employ 3000 permanent jobs. He hopes to start construction in 2014 and end in 2020.
Black explains this plant will eliminate the risk of a spill of an offshore oil spill because transported refined fuels are much safer and evaporate from the environment.
Kitimat City Council found themselves in a sticky situation with this announcement. Prior to discussing what the refinery implies for their neutrality, Mayor Joanne Monaghan expressed the announced refinery was “Good News,” including it in her “Good News” announcements at the beginning of the Council Meeting for Monday, August 20th, implying Council’s support behind it.
She was also quoted in the newspapers owned by David Black on August 17th stating she, as Mayor, hopes the refinery goes ahead and the announcement will go down as a “Great day in history.”
On Monday, August 20th, Council met in camera to discuss their position on the refinery.
Monaghan told us: “Council’s stance is that they agree with any natural resources that are value added in our area. However, they always wait until the environmental review has taken place to make sure that it’s compatible with our community.”
We also asked Monaghan who would get the taxes from this refinery as it is located on crown land between the communities of Kitimat and Terrace. She expressed she did not know if either Terrace or Kitimat would receive tax benefits from this project but she determined it would be worked out.
The BC NDP Criticized the Refinery for not having any backers. In a news release, New Democrat energy critic John Horgan was quoted as saying: “At this point, it’s a proposal without business partners and without First Nations and local community support. It doesn’t change our position on the Enbridge Northern Gateway project.”
They also question whether or not Black will be able to gain support from Enbridge or it’s foreign backers. Skeena MLA Robin Austin was also quoted, pointing out: “There is nothing wrong with the principle of trying to add value or economic benefit to the project, but the potential for disaster with the pipeline is unchanged. […] Northern communities know the risks are too great, and that’s why they oppose the project.”
“When I heard about it and who’s behind it, I found it laughable,” said Murry Minchin, who has been speaking for Douglas Channel Watch. “The person has no financial backers, he’s got no money behind them. It’s a media ploy.”
Minchin also stated it reminded him of the Elmer Derrick incident. He stated it did not make sense to put a refinery this far away from the hub.
Since the Press release last week, Black has answered several questions about the refinery. One of which is why he isn’t building the refinery in Alberta.
“Unfortunately it cannot be done economically. Firstly, all refineries are built from modules that are constructed in lower wage areas of the world. The refineries would be prohibitively expensive otherwise. Modules transported inland to Alberta would be limited to container-sized loads so they could be transported on trains and trucks. A tidewater location like Kitimat’s allows for the use of huge modules that are considerably less expensive. Secondly, the economy in Northern Alberta is overheated. There are already too many jobs and not enough workers. Northwestern BC is the opposite. It needs more construction jobs and permanent jobs. The difference in the cost of constructing a refinery, from these two factors, is several billion dollars,” wrote Black.
He also expressed it would not be cost effective to build in Alberta. Eight products would be ran through the pipeline and such would not be waste.