The divisions between old-style Progressive Conservatives and the next generation of Tory leaders were on full display Tuesday as former premier Peter Lougheed said he doesn't agree with the movement of refinery jobs south — specifically down the Keystone XL pipeline to the U.S.
It's a policy stance that has been carried by Alberta unions and opposition parties, but stands in stark contrast to much of what is being said by the candidates in the race to replace the departing Premier Ed Stelmach.
"What Keystone gives us is an opportunity to continue to have a lot of strong economic development in the province," candidate Alison Redford said on Tuesday. "At this point in time, in terms of how our economy is structured, Keystone makes sense."
TransCanada Pipelines Ltd.'s proposed pipeline system expansion would run from Alberta through the U.S. to the oil-thirsty refineries of the Gulf Coast. But the controversial project has not yet been given final approval in the U.S.
Ted Morton and Rick Orman are in favour of the pipeline. Former health minister and leadership candidate Gary Mar has pledged that if he wins the premier's chair, he will be in Washington, D.C. next month to advocate for the project at congressional hearings.
"Premier Lougheed is somebody that I have a great deal of respect for, but this is an important project for Alberta," Mar said on Tuesday.
Leadership candidates Doug Horner and Doug Griffiths have more nuanced takes on Keystone.
"I think in general I'm in favour of Keystone," Horner said at a Herald editorial board meeting Tuesday, noting it's good to have markets "hooked on your product."
But at the same time, Horner said he wants to see 60-65 per cent of bitumen upgraded in Alberta, and that the government can be a "catalyst" for that economic development.
Griffiths, the youngest Tory in the race, said if the U.S. rejects the Keystone project, "I wouldn't be upset. I'd smile and say, 'great, we'll upgrade it here, and we'll ship it to somewhere that does want it.'"
Lougheed, who served as premier from 1971 to 1985, has long called for "more orderly development in the oilsands," saying the current system drives up prices for everything from labour to consumer goods across the province. In 2006, he told the Herald "having all these projects go concurrently is going to substantially reduce the return to the owner — and we're the owner."
On Tuesday he took on the issue of where Alberta's hydrocarbons get processed into usable fuels. In an interview broadcast Tuesday morning, Lougheed told CBC Radio that the Keystone pipeline will create thousands of new jobs in Texas, and he doesn't agree with that.
"We should we be refining it in Alberta and we should make it public policy of the province. Hopefully the new premier, whoever he or she is, will deal that issue pretty quickly."
However, Lougheed's comments on the Keystone pipeline and processing fit in more with what Alberta's opposition party leaders have said.
Newly elected Alberta Liberal Leader Raj Sherman has already indicated he doesn't want raw bitumen shipped out of the country — he wants the processing jobs here. Provincial NDP Leader Brian Mason, who has long said the Keystone pipeline will kill economic opportunities for the province, said he hopes that Lougheed's comments bring more attention the management of Alberta's non-renewable resources.
"I feel like I've been rescued by the cavalry," Mason said of Lougheed's words. "He can tell the difference between the interests of the oil companies and the interests of the province."
But the industry defended the push for the pipeline. TransCanada spokesman Shawn Howard said the company is simply delivering on a demand for its services, and there is no Canadian alternative for refining the product being brought forward.
"It's up to the market to make choices," Howard said.
In an e-mail, Canadian Energy Pipeline Association president Brenda Kenny said the Keystone project should be looked at from the broader perspective of North American energy infrastructure development.
"In some cases, bitumen upgrading in Alberta is part of the overall value proposition," Kenny said. "In some other cases due to different market conditions, it is not."
Up until recently, the pipeline's main public critics have been environmental groups who have panned everything from the increasing greenhouse gas emissions from the oilsands, to the effects of the pipeline crossing over key American aquifers.
But the final word on whether the project will be approved will come from U.S. President Barack Obama's office late this year or early in 2012.
