Alward makes 'crystal clear' commitment to shale gas

Premier David Alward used his annual state of the province speech to reiterate his government's "crystal clear" commitment to developing the shale gas industry in New Brunswick, regardless of any potential political repercussions.

The government is looking to the development of natural resources, such as shale gas, and a new plan for the forestry sector, to be released within days, to grow the economy, create jobs and deal with the deficit, Alward told the Fredericton Chamber of Commerce on Thursday night.

Alward has touted the controversial shale gas industry before, but the speech was his final state of the province address of his first mandate, with the provincial election just eight months away.

"I want to be crystal clear, that we are supportive of shale gas, and its potential as an industry to help us achieve our goals. To not take advantage of this opportunity would be one of the most irresponsible things a government could do," he said.

"I've had many people ask me why we are doing all these things, slow down, take the easy way out. That may be the most politically prudent approach, but I didn't sign up for this job to stand still and press pause."

During the 54-page speech, entitled Celebrating the Past, Energizing the Future, Alward said he believes the province is poised for an exciting and prosperous future.

"Three years of hard work to bring our fiscal situation back from the brink has set the stage for a New Brunswick resurgence, but only if we choose to take advantage of the opportunities before us," he said.

Cost of not moving forward too great

To that end, the government is "aggressively pursuing" resource development, Alward said.

The oil and gas industry alone could mean more than $20 billion in investments and royalties for the province and create thousands of jobs, bringing many New Brunswickers home from Alberta and British Columbia, he said.

"Our vision is that New Brunswick become a rich gateway for Canadian natural resources to the rest of the world."

"India, Europe, Africa, North and South Amercia — they will all look to New Brunswick as a critical player in the global energy market."

A domestic source of natural gas would resolve supply issues, such as the current shortage in the northeast that has resulted in record high prices, and ensure competitive prices in the future for residents and businesses alike, he said.

We will not let the personal agendas of the minority be a roadblock to developing our province's bright future.- Premier David Alward

The government is also looking for ways to create new import opportunities to provide more supply options to feed the investments in LNG and gas-intensive manufacturing.

"The decision before us is simple: do we listen to those who say 'no' to the very same opportunities that have created the strongest economies in North America, or do we finally say 'yes?' From where we stand, the cost of not moving forward on these initiatives is simply too great," the premier said.

"We will not let the personal agendas of the minority be a roadblock to developing our province's bright future."

Growing opposition

The government has faced growing opposition to shale gas, including months of daily protests in Kent County, where SWN Resources Canada was conducting seismic testing.

People opposed to shale gas development are concerned about the potential environmental impact of hydraulic fracturing, also known as hydro-fracking.

The process involves injecting water, chemicals and sand into the earth at high pressure to fracture shale rock to release the natural gas within it. Opponents say the process could harm groundwater supplies.

Some of the protests have been violent. On Oct. 17, dozens of protesters were arrested and six RCMP vehicles were torched. Policing costs associated with the protests totalled more than $4 million, government officials have said.

SWN completed its seismic testing in the Rexton area on Dec. 6, but plans to drill two exploratory wells this year, Alward confirmed. The location and timing have not been released.

Corridor Resources has also commenced the permitting process for new wells in the Sussex area, Alward said.

The government is hopeful the results will add significantly to the province's reserves, making New Brunswick one of the largest shale gas deposits in North America, he said.

TransCanada Corp.'s proposed west-east oil pipeline also has the potential to bring 3,855 direct and indirect jobs to the province during the development, construction and operational phases, he said.

The company has signed letters of agreement with 13 First Nations communities in the province and is expected to file its submission on the Energy East project to the National Energy Board this year, he added.

The government is also optimistic about mining projects, such as Northcliffe Resources' Sisson project near Stanley, which should begin construction this year, said Alward.

The project is expected to employ up to 500 people during the construction phase and about 300 people during operations over 25 years.

"Every New Brunswicker stands to benefit from these projects," Alward stressed.

Forestry announcements pending

The government has also developed a strategy that will make the forestry industry more competitive, drive investments and result in hundreds of new jobs in the province — the majority of them in rural areas, Alward said.

"In the coming days we will unveil our forestry plan that will focus on increasing the amount of fibre we can put in the system and ultimately put more boots in the woods all over the province and create jobs," he said.

Alward expects to announce in the "very near future" multiple projects that will result in more than a half billion investment, more than 500 new jobs in a number of operations and more than 1,000 construction jobs.

The New Brunswick government released its 10-year forestry plan in 2012, but the industry has been lobbying for guaranteed long-term access to Crown land.

J.D. Irving Ltd. and others forestry firms have said they are willing to spend $1 billion on mill upgrades and silviculture if the provincial government would let them cut more wood on public land in the years to come.

The companies argued they needed a reliable wood supply in order to have the confidence to invest in the province.

Forestry remains the single most significant sector to the provincial economy, Alward said on Thursday.

More than 4,000 jobs to be created

The initiatives outlined in the speech could mean 4,354 more jobs in New Brunswick, said Alward.

"To put that in perspective, it's like we created another Sussex, or another Beresford," he said.

Among the initiatives, the premier announced plans to expand a program designed to increase the number of jobs available to recent post-secondary graduates.

The One Job Pledge initiative's new target is 1,000 jobs, he said.

The program, launched last January, offers a one-year wage incentive to businesses that hire a permanent, full-time employee who graduated from a post-secondary institution within the past four years.

It had already surpassed its initial goal of creating 650 jobs and is nearing its revised goal of 850, announced in November, said Alward.

"These good jobs provide a way for recent graduates to begin a meaningful career here at home," he said.

Encouraging innovation

The government is also launching an initiative at schools at the province called Brilliant Labs as part of its ongoing efforts to encourage innovation, said Alward.

Brilliant Labs, an umbrella for new investments from government and the private sector, will award grants to the most passionate and innovative schools, teachers and their students for projects such as coding, robotics and arts, he said.

Last year, during the state of the province address, Alward made an $80 million commitment to fund innovation.

That funding has resulted in a pilot project called Kids Coding at schools, introducing technology to children, he said.

It is also helping to encourage entrepreneurship among students in the francophone system through a program called Place aux compétences, Alward said.

Budgets expected next week

The Alward government's final operating and capital budget is scheduled to be released on Tuesday.

The projected deficit for end of the current budget year on March 31, 2014 is about $538 million, while the overall net debt stands at about $11 billion.

Alward's Progressive Conservatives had pledged before the 2010 election to balance the budgets by 2014.

In December, Auditor General Kim MacPherson said the province is facing a disturbing long-term trend of more deficits and debt.

In her 2012-13 annual report, MacPherson said New Brunswick's net debt has grown by 45 per cent since 2009, putting the province in a tie with Saskatchewan for the greatest increase over that time. Since 2007, the debt has grown by 63.3 per cent.

Finance Minister Blaine Higgs had said the government may need to consider school closures to battle the provincial debt. "We have to look at serious changes in how we do business," he had said.

Alward said he wants to be known as the premier who "led us through the challenges of yesterday and into the successes of tomorrow."