The Fracking Calculation

Posted to Moncton Free Press, February 19, 2012

David W. Campbell calls on New Brunswick chambers of commerce and business development agencies to vboice their support for the development of the shale gas industry in the province.

He suggests that their reticence is based on their fear of the opposition to shale gas, or as the extraction procedure is called, fracking. But given that government and industry have shown little hesitation to quash the opposition at will - witness the Moncton High fiasco - there is no real reason to believe they are merely caving to the opposition in this case.

What probably keeps them from being vocal in their support is that they realize that there's nothing in it for them, and possibly some risk.

In other jurisdictions, a large secondary industry grows around the oil and gas industry. But that's not what happens in New Brunswick. Even as the major players in oil and gas expand, even as their profits increase, employment and business development stall.

And with fracking, there is some risk True, in other places, those impacted would be compensated. But not in New Brunswick. Here people have to fight in court for even marginal relief if they are impacted. A town or village with a contaminated water supply cannot survive, and chambers of commerce know this.

Meanwhile, what of royalties. Other provinces gain significant royalties for resource extraction, whether gas in Alberta or Potash in Saskatchewan. But not New Brunswick. With the industry supports expended to the resource industry, it is almost as though we are paying the resource companies to mine, mill and sell them.

Now let me be clear. I am in favour of the shale gas industry, I would like to see it developed, and I would like to see the economic benefits that would result. Yes, we need wind, solar and other environmentally-friendly forms of energy production, but we also need gas fuel, plastics and other synthetic products.

But my support is not without conditions. And neither, it would appear, is that of the business and economic development community in the province.

We want to see spin-offs. We don't want to see one great big company controlling all aspects of production and keeping all the profits for itself. We want an economic cluster, so we can develop secondary industries and expertise.

We want to see compensation for harm done. We are told shale gas is safe. Mostly, it is. But if it's safe, there should be mo problem for government and industry to make iron-clad promises that they will fully and quickly compensate any harm caused.

And we want to see some royalties. Nothing special - but we need to know that our government will have what it takes to stand up to some very large companies - not just those producing shale gas, but also any of the other natural resources of the province - and say it's time for some proper royalties.

What is puzzling - and what David Campbell should be looking at - is why these very basic conditions are missing from resource development in this province. We need, as a province, to have this discussion. Where does our resource wealth go, who earns it, what what do they do with it?

Once we start talking about resource development that supports everybody, we might see more support for it.


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