TOMS LAKE, B.C. – Wearing steel-toed work boots, coveralls and a hard hat, Liberal leader Gordon Campbell toured a natural gas drilling rig during a campaign stop in northeastern B.C. on Thursday.
The rapid expansion of oil and gas activity in the province has been controversial and there have been three unsolved bombing incidents targeting the industry.
But Campbell said the oil and gas sector in the northeast corner of the province is a huge wealth generator for B.C., with land lease sales that amassed $2.6 billion in revenues last year and another $1 billion in royalties.
The Liberal leader says the industry is an innovator of clean technology for the energy sector but a New Democratic Party plan to tax flaring gases from gas wells will hurt the industry during tough times.
Already, workers say tough times have hit. Drill-rig workers at EnCana’s Toms Lake operation say they’re taking a 10-per-cent pay cut, effective next month, as B.C. struggles with recession.
Energy Minister Blair Lekstrom said taxing gas flaring will cause some companies to reconsider working in British Columbia altogether.
“Right now, this oil and gas industry is helping drive the economy of British Columbia,” said Lekstrom, who accompanied Campbell on the northern campaign stop.
“If their flaring tax were to be implemented in this region – and this is where the oil and gas is – I can tell you won’t see the activity here in the northeast part of the province. These rigs will pack up, they will move back to a more competitive jurisdiction.”
Campbell said the Liberals plan to have zero gas flaring by 2016 and cut flaring by 50 per cent by 2011.
A spokesman for EnCana, the major industry player in the area, said the company is working to eliminate flaring.
Richard Dunn estimated his company will pay up to $5 million in carbon taxes to the government – a levy he says the company can live with if everybody pays their share.
The carbon tax is a major part of the government’s plan to reduce greenhouse gas emissions by one-third by 2012.
But the controversial tax is taking money out of the pockets of regular British Columbians, said New Democrat Leader Carole James.
She said it adds up to $300 in fuel costs per year for the average family. She’s promised to scrap the environmental levy if elected, savings taxpayers and business in B.C. $1.8 billion over the next two and a half years.
“Gordon Campbell is the only leader in the western world who thinks it’s a good idea to raise taxes in today’s tough economy,” James said in a statement as she campaigned in Burnaby.
“His plan hits families struggling to make ends meet and businesses trying to make a profit in the recession”.
The escalating carbon tax was introduced last July and adds 2.4 cents per litre on the price of fossil fuels, including gasoline. The tax will increase to about eight cents by 2012.
She said the B.C. Business Council has asked the premier to eliminate the tax but he’s refused.
“Now, with job losses piling up it’s even more critical to scrap this tax,” she said.
The New Democrats have been criticized by some of their traditional supporters for their ongoing campaign to “axe the tax,” but James said the levy has failed to reduce emissions.
The NDP said Statistics Canada data shows fuel consumption climbed four per cent since the gas tax was imposed earlier this year, contrary to Liberal predictions.
The New Democrat platform calls for a continental cap-and-trade plan to reduce greenhouse gas emissions – an approach the Liberals are pursuing with several other provinces and U.S. states.