Natural resource dollars bridge urban-rural gap

New study by iTOTEM Analytics shows the massive contributions of natural gas industry investments to BC communities from Fort St. John to Vancouver.

They call it “the urban-rural divide,” and in BC, many say it’s a problem.

Let's start with a description of the divide from journalist Dene Moore, who lives at 100 Mile House:

“In rural communities, we’re afraid. We see a province where 55 percent of the population lives in Metro Vancouver. . . . They work in start-ups and Starbucks and high-rise office buildings. They want old growth forests – elsewhere, of course – and seem to think the oil and gas industry can just come to an end without a viable alternative in place."

Many in urban centres are simply unaware of the rural economy, especially in the interior of the province, which is built around natural resource development. More, still, are unaware of how their own urban communities have benefited from natural resource development.

Some new numbers from an iTOTEM Analytics study on behalf of the Canadian Association of Petroleum Producers (CAPP) may soften the division. It drives home that natural-resource development and its spending is not limited to rural and remote areas.

The new study looked at the natural gas (and oil) industry’s supply chain in BC and found it is a major contributor to the economies of municipalities and Indigenous Nations in every corner of the province.

Natural gas industry community investment. Image from CAPP.

The study reported that from 2018 to 2021, $4.7 billion was spent on goods, materials, and services for BC natural-gas operations, with more than 2,400 BC-based suppliers. And those suppliers were located in, or affiliated with, some 140 BC municipalities and Indigenous Nations.

The study found that Vancouver was fourth on a list of the top ten municipalities in terms of industry spending, and that 120 companies in Vancouver benefitted.

“Notably, the natural gas sector supply chain had a significant impact on urban British Columbia. Expenditures by  . . . companies with operations in Metro Vancouver increased by 25% between 2018 and 2021,” reads the report. And it added this example: “Vancouver outperforms other municipalities in terms of chemical suppliers to the industry.”

There was more than just business spending, too: The natural-gas firms also spent on BC community initiatives, covering everything from charitable donations to children’s breakfast programs, from health and welfare to sports programs, and from community festivals to funding for municipal first responders.

Companies studied reported contributing approximately $16.8 million in community investments between 2018 and 2021.

“Sponsorships, donations, and in-kind contributions supported more than 350 organizations in over 25 municipalities and Indigenous Nations across BC between 2018 to 2021. Approximately $13M was made in community investments with Indigenous Nations or affiliated organizations.”

A graphic from the report showing natural gas industry investment across the supply chain. Image from CAPP.

The report also points out that there’s more to the sector than dollars.

“BC’s upstream natural gas and oil industry (is) one of the safest, least carbon-intensive and most stringently regulated energy sectors in the world. The natural gas and oil supply chain in British Columbia is critical to Canada's ability to meet the growing demand for responsibly produced affordable energy both at home and globally.”

The study was conducted over ten months by iTOTEM Analytics, an Indigenous-affiliated company. It noted: “4% of the businesses engaged in the BC natural gas sector were Indigenous affiliated; whereas Indigenous-affiliated vendors represented 11.5% of BC’s total supply chain spend.

“The BC natural gas sector spent $540M with some 100 BC-based Indigenous-affiliated businesses and organizations between 2018-2021.”

The report also said: “BC's world-class natural gas resource is stewarded by Indigenous Nations and municipalities, in every region of the province, from an energy-efficiency combustion engineering firm in Victoria to an environmental planning consultant in Nelson, to a metal fabricator in Parksville, to an Indigenous-owned earthworks supplier in Wonowon, to a construction company in Kitimat. Your neighbours and friends most likely work in the industry, either directly or indirectly.”

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