Why Exporting Raw Bitumen Instead of Refining it in Canada is Bad for Canadians

Yesterday's Article 'Keep the oilsands' wealth at home' in the Vancouver Sun by Economist Robyn Allan is just the latest in a series of articles she's written in the last few months where Allan argues that the economics of exporting raw bitumen do not stand up to serious scrutiny. Robyn Allan has outlined in her past articles why the Enbridge and Kinder Morgan pipelines will harm Canadian economy and that it's a "false dichotomy" to suggest that the pipeline proposals are a question of either supporting economic growth or promoting the environment and First Nations' rights.

In her most recent article yesterday she spoke to the question of 'winners and losers' created by the Conservative government's insistence that exporting raw, unrefined, bitumen to Asia and the US is a priority for Canadian economic security. Allan points out that the multinational oil companies and companies owned by countries - such as China-the same companies that own Canadian exploration and production rights also own the refineries in the U.S. and China. They don't like our higher labour and environmental standards.

"Upgrading and refining are where the jobs and economic wealth come from - not ripping it and shipping it to foreign countries so they reap the gain from turning Canada's raw resources into end-user products." Allan says our energy resources "will be shipped as bitumen along with the jobs, labour income and government revenues that go with it. Alberta's new energy strategy is actually hollowing the downstream capabilities of the oil industry."

Back in pre-collapse 2008, Alberta's oil producers announced a wide range of upgrading and refining conversion projects to process crude oil at home. But when oil prices tumbled at that time so did investment capital for the proposed refining capacity expansion. If those new facilities had been built western crude could flow to Eastern Canada - along with the economic benefits of energy independence. Refining our raw materials, creating secondary industries be it in the oil industry of the forest industry where exporting raw logs is just as stupid, keeps the money, jobs and government revenues of value-added production and wealth at home.

So the winners of Harper's get rich quick schemes are the multi-national oil giants and the Canadian oil oligarchy along with the Conservative party who are the beneficiaries of their corporate largess. The losers are the rest of us in Canuckistan.