>In this final instalment of a three-part series, Business in Vancouver examines a decade-long economic downturn in the northwest and how the Northwest Transmission Line could breathe new life into small communities. >The first instalment of the series (issue 1116; March 15-21) looked at the project’s prospects for generating investment in the north; the second instalment (issue 1117; March 22-28) focused on how the power line could affect port business and influence Alaska’s energy plans
When northwest B.C.’s forest industry began its downhill slide in the 1990s, no one in the region had any idea how long it would last.
As the years progressed, and more mills closed, a deep depression set in, one that towns and businesses continue to wrestle with.
“The recession that the rest of the world was feeling recently didn’t even phase us, because we’ve been in the recession since 1997,” said Valerie Gauvin, business manager at Terrace’s Progressive Ventures.
But the forest industry isn’t entirely to blame.
In the last decade, the northwest has watched a mine shut, a methanol plant close its doors, a major mineral project get mothballed and a smelter modernization program and liquefied natural gas terminal, until recently, languish amid a global downturn.
Despite the bad news, business and community leaders have a new reason to smile – the Northwest Transmission Line (NTL).
“We’re looking for the Northwest Transmission Line to be the first big project to happen since the decline of the forest industry,” said Robin Austin, NDP MLA for Skeena.
The proposed $404 million line would stretch north along Highway 37 from Terrace to Bob Quinn Lake, electrifying a part of the province that has long relied on expensive and dirty diesel power.
The project received provincial environmental approval last month, a decision that will allow a host of mining and independent power companies to invest billions in the region.
Businesses around the province have already begun to turn their eyes toward the northwest, and the communities there are embracing them with open arms.
“It’s going to be transformational,” said Terrace Mayor David Pernarowski. “To start, it’s just the construction phase … and that construction will bring jobs and opportunity and all the good things associated with it.”
While much of the rest of the province enjoyed growth in the last decade, the northwest has suffered somewhat of an exodus.
Statistics Canada data shows that although B.C.’s population rose 5.3% between 2001 and 2006, Terrace’s population declined 6.5% to 12,109.
The Stikine region saw its population drop 15.7% during the same period, while communities such as Prince Rupert, Kitimat and Smithers dwindled 12.5%, 12.6% and 3.6%, respectively.
Austin said the downturn has turned once-booming manufacturing towns into struggling service stops along the highway.
“When you live in a small town and most of the jobs are service-based, it’s very hard to support a family on those wages.”
But the NTL promises major changes.
Work camps are already under construction for Imperial Metals’ (TSX:III) Red Chris project and AltaGas’ (TSX:ALA) Forrest Kerr project, local businesses say.
That’s left Pernarowksi thinking about what his community has to offer investors.
“In the main part of our community where sawmills used to reside we have really good industrial land that, typically, makes … jaws drop in terms of affordability,” he said.
Two weeks ago, the city agreed to buy 88 acres of land from the province for a proposed industrial park.
The price? $75,000.
“Those peripheral businesses that need to be created around major projects, those need to start coming online in the very near future,” Pernarowski said.
The story is no different in Smithers.
Mayor Cress Farrow said his town is already seeing the benefits of the NTL.
“We put properties on the market a month ago and a week later we had sold six lots,” Farrow said. “The optimism was immediately there. As soon as the announcement was made … property was selling.”
Smithers hopes to rebuild its reputation as a centre that can support the mining industry, and Farrow is driving plans for a large residential subdivision to house new residents.
Although the NTL extends north along Highway 37, Austin believes communities across the north will reap the benefits.
“Even though the mines are a long way from Prince George, this could really help the whole of central and northwest B.C.,” Austin said, “and let’s not forget the huge effect it will have on provincial revenue.”
But not every town will see drastic growth.
“I imagine we’ll see some, [but] I think there’s more business generated around Smithers and Terrace for mining, expediting companies and things like that,” said Steve Quigley, owner of the Arctic Divide Inn in Dease Lake.
The project has also met with resistance from some First Nations, even though it would deliver power to off-grid communities.
In November, the Lax Kw’alaams First Nation sent a letter to the province claiming it had not been properly consulted on the project in regard to its aboriginal rights and title in the area.
To date, BC Hydro has signed only three impact benefit agreements with aboriginals, although the project affects seven First Nations. Still, Gordon Loverin, a member of the Tahltan First Nation and co-chairman of the Northwest Powerline Coalition, believes the power line will bring much-needed opportunities to the “doorsteps” of off-grid communities that have struggled to gain economic independence.
It would also create much-needed jobs at a time when aboriginal populations continue to grow faster than other demographic groups.
For example, the population in the northwest community of Iskut jumped 18.4% between 2001 and 2006. Loverin believes First Nations communities would be wise to embrace the opportunities the power line would bring.
“You keep hearing about this need to protect aboriginal rights and title … but when you talk to a lot of young people who are in the communities, who are looking to raise their own families, looking to get a job … you have to ask yourself, can you eat aboriginal rights and title?” Loverin said. “And, generally, aboriginal rights and title is a good thing for moving toward a better future, but at the end of the day you cannot eat rights and title, so you have to look at the opportunities for creating a strong local economy.”
The following is a random sampling of quotes from dozens of comments submitted to the provincial government during the environmental assessment review. The documents are public and can be found on the B.C. Environmental Assessment Office’s website.
– Jim Miller-Tait, North Vancouver, May 3, 2010
– Sam Harling, Terrace, May 19, 2010
– George and Angeline Chinn, Terrace, May 27, 2010
– Dave Merritt, Terrace, June 1, 2010
– Josette Wier, Smithers, June 7, 2010
– Rachel Darvill, Golden, June 9, 2010