First in a series
The completion of four northern B.C. megaprojects, worth a combined $88.6 billion, will mean the end of thousands of jobs and billions of dollars in economic activity in the region.
Construction of the Coastal GasLink pipeline from Dawson Creek to Kitimat, the LNG Canada liquified natural gas export terminal in Kitimat, the BC Hydro Site C hydroelectric dam near Fort St. John and the Trans Mountain Pipeline expansion project from Edmonton to Burnaby are all expected to be substantially complete over the next two years.
According to publicly-reported data, those four projects employed an average of 18,632 people in northern B.C. throughout 2022 – a labour force equal to almost seven per cent of the entire working-age population (15 and older) of the province’s three northern economic development regions: Cariboo, Northeast, and North Coast and Nechako.
“That's a lot of jobs,” Northern Development Initiative Trust (NDIT) CEO Joel McKay said. "These major projects have had an absolutely significant impact... not just on northern B.C., but across the province."
The megaprojects helped the province, and especially northern B.C., weather the economic downturn of the COVID-19 pandemic, McKay said. The projects didn't just create direct jobs, but have created indirect employment in a wide range of sectors including catering, hospitality, suppliers, skilled trades, engineering firms and many more.
"It's a very broad and diverse set of contractors and suppliers that have benefited from these projects," McKay said.
Given the complexity of the projects and their economic impact, it is hard to estimate what the multiplier effect has been in terms of indirect jobs created, he said. McKay's northern B.C. economic development agency estimates three indirect jobs are supported for every direct job in the forestry industry, but with temporary construction projects it is harder to estimate.
The completion of megaprojects comes at an already challenging time for northern B.C.’s economy. B.C.’s forestry, pulp and paper sectors, traditional mainstays of the northern B.C economy, are on the decline.
Canfor announced the closure of the pulp line at its Prince George Pulp and Paper Mill on Jan. 11, and its Taylor Pulp Mill has been curtailed since February 2022. Paper Excellence permanently closed its pulp mill in Mackenzie in 2021. Pacific BioEnergy permanently shuttered its wood pellet plant in Prince George in March 2022.
More mill closures are expected in 2023, and many have taken temporary curtailments to reduce production.
Economic activity from the megaprojects has helped offset some of the job losses and loss of economic activity in communities that have been hard-hit by job losses in the forest sector, McKay said.
"Mackenize and Fraser Lake are examples of communities that are seeing a lot of economic activity because they have a Coastal GasLink camp near their communities," he said.
Those communities are "looking down the barrel of significant contraction and job losses," when Coastal GasLink is completed later this year, and thousands of workers pack up the camps and go home, he said.
Prince George, as the service and economic hub of northern B.C., can expect to feel the pinch along with the rest of the region, he said, but the impact may not be as direct and pronounced.
"Prince George has a more diverse economy than other communities in the north," McKay said. "It will be difficult to determine in Prince George how that is going to look."
There are mines and other projects proposed which could help "ease the hangover" after a period of record private-sector investment in northern B.C., he said.
McKay said his "number-one fear" is these major projects will be completed and the forestry sector will continue to decline, and there will be nothing to replace that activity.
The completion of the projects will create new, permanent jobs, he said, but those jobs will represent a fraction of the jobs involved in construction. For example, LNG Canada currently employs roughly 6,000 workers during construction, but once complete the liquefied natural gas terminal is expected to create 200 to 250 ongoing jobs.
There needs to be efforts at all levels to make sure northern B.C. is a competitive jurisdiction which can attract private-sector development and get it built, McKay said.
"We have to be looking to the next thing," he said. "You can have a $100 billion in projects planned, but if none of it ever gets built it doesn't matter. We have to get to yes."
If northern B.C. can't attract new sectors and new employers to fill the gap that the megaprojects and forestry is leaving, then "we can expect things to get worse and harder in northern B.C.," he said.
MEET THE MEGAPROJECTS
TC Energy’s $11.2 billion, 670-km-long Coastal GasLink natural gas pipeline was 81.2 per cent complete in December, and on schedule to be completed by the end of this year. Between January and November 2022, the project employed an average of 4,777 workers in northern B.C., reaching a peak of 6,389 workers during September. TC Energy has not yet reported worker numbers for December 2022.
TRANS MOUNTAIN PIPELINE EXPANSION
The $21.4 billion Trans Mountain Pipeline expansion project to nearly triple the capacity of the 1,150-km oil pipeline from Edmonton to Burnaby is also slated for completion later this year. The North Thompson section of the project, running from near Mount Robson to Blue River, employed an average of 2,901 workers in northern B.C. – outnumbering local residents in the village of Valemount - from January to September 2022. Roughly 30 per cent of workers in the North Thompson section lived in the region. Trans Mountain has not yet reported its employment figures for the final quarter of 2022.
SITE C DAM
Further north, construction of BC Hydro’s $16 billion, 1,100 megawatt Site C dam was 70 per cent complete as of Sept. 30, and on target to be operational by 2025. Work on the dam employed an average of 4,954 people from January to November 2022 – including an average of 989 local residents of the Peace River Regional District and a further 2,386 British Columbians from other parts of the province. BC Hydro has not yet reported worker numbers for December of 2022.
LNG CANADA TERMINAL
In Kitimat, work on LNG Canada’s $40 billion liquified natural gas export terminal is 80 per cent complete and on track to be complete “by mid-decade,” LNG Canada CEO Jason Klein said during a presentation at the BC Natural Resource Forum on Jan. 18. Roughly 6,000 workers were on-site on the project, Klein said, and the company has projected up to 7,500 will be needed during peak construction.
“We will prove that Canada can deliver megaprojects and I hope on the back of that, that allows the next wave of projects, most of which are Indigenous-led, to follow behind us,” Klein said.