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Free Ben Hur! · 05-01-2012, 03:28 PM

The whole infrastructure funding formula for the Wood Buffalo region needs major reform. When GCOS (Suncor) was built in the 60's, Sun Oil (and their prime contractor Bechtel), installed the needed infrastructure in Fort McMurray BEFORE major construction of the facility itself took place. Why? Until this point in time Fort McMurray was little more than a trading post. This process was repeated, on a larger scale, when Bechtel returned to build Syncrude Canada in the 70's. This is how things are done all over the world to support megaproject construction.

Somewhere industry and government in Alberta have lost their way on when and how to fund the infrastructure requirements of the region. To me, a new funding mechanism is needed for looming infrastructure expenses that is built-in to the upfront budgeting and approval of new projects. Raising infrastructure funds from royalties and taxes paid to the Province (i.e. after construction costs have been recovered) is too late in the process.

Maybe start with a government led advisory panel of stakeholders (economists, industry, infrastructure experts, the public) to determine a funding formula and bind the formula to the project approval process, i.e. an infrastructure surcharge on the project budget. Think airport improvement fees except paid for by the leaseholder. Of course the oil companies would howl like banshees which, of course, would be the first indication that the idea would be good for taxpayers and residents. I mean, it's not like these facilities are just marginally profitable.

Turn the money over to the level of government capable of most effectively managing it (i.e. Wood Buffalo not the Provincial Government) at the time of project approval. (A caveat: transportation projects like highways and rail that exist in multiple jurisdictions would obviously need to be jointly managed.) This would allow required infrastructure to be moved along at a pace much closer to that of the major projects. Wood Buffalo will be in a perpetual state of catch-up if the status quo is maintained.

05-01-2012, 03:28 PM	#51
Free Ben Hur! Scoring Winger Join Date: Oct 2009 Location: Judea Exp:	The whole infrastructure funding formula for the Wood Buffalo region needs major reform. When GCOS (Suncor) was built in the 60's, Sun Oil (and their prime contractor Bechtel), installed the needed infrastructure in Fort McMurray BEFORE major construction of the facility itself took place. Why? Until this point in time Fort McMurray was little more than a trading post. This process was repeated, on a larger scale, when Bechtel returned to build Syncrude Canada in the 70's. This is how things are done all over the world to support megaproject construction. Somewhere industry and government in Alberta have lost their way on when and how to fund the infrastructure requirements of the region. To me, a new funding mechanism is needed for looming infrastructure expenses that is built-in to the upfront budgeting and approval of new projects. Raising infrastructure funds from royalties and taxes paid to the Province (i.e. after construction costs have been recovered) is too late in the process. Maybe start with a government led advisory panel of stakeholders (economists, industry, infrastructure experts, the public) to determine a funding formula and bind the formula to the project approval process, i.e. an infrastructure surcharge on the project budget. Think airport improvement fees except paid for by the leaseholder. Of course the oil companies would howl like banshees which, of course, would be the first indication that the idea would be good for taxpayers and residents. I mean, it's not like these facilities are just marginally profitable. Turn the money over to the level of government capable of most effectively managing it (i.e. Wood Buffalo not the Provincial Government) at the time of project approval. (A caveat: transportation projects like highways and rail that exist in multiple jurisdictions would obviously need to be jointly managed.) This would allow required infrastructure to be moved along at a pace much closer to that of the major projects. Wood Buffalo will be in a perpetual state of catch-up if the status quo is maintained.