Major oil spill could cost Vancouver economy $1.2 billion: study

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Image: Greenwest Sysystems Inc.

A new study by the University of British Columbia has provided further insight on how a major oil spill in Burrard Inlet could have a highly detrimental impact on Vancouver’s economy.

UBC’s Fisheries Economics Research Unit’s report, commissioned by the City of Vancouver, notes that much of the city’s economy revolves around activity that occurs in or near the water.

It modelled the impact of a 16 million litre oil oil spill in Burrard Inlet and found that such a spill could cost the economy between $380 million to $1.23 billion in output, up to $687 million in GDP, and as much as 12,881 person years of employment.

To provide some perspective, such a spill would be 5,333 times larger than the 3,000 litre spill in English Bay in April 2015. But it would be smaller than the infamous 1989 Exxon Valdex, which dumped about 40 million litres of oil onto the Alaska coastline.

The key factors examined for the potential impact of a spill were commercial fishing, port activities from both cargo and cruises, inner harbour transportation, tourism and recreation.

Approximately 37,000 jobs within the city limits are dependent on local waters, generating over $3 billion in GDP each year. This includes numbers as high as 9,126 jobs for ocean-dependent tourism and 1,307 for jobs along beaches and the seawall while the bulk of the remaining jobs are the result of port activities.

Vancouver’s beaches and waterfront parks attract millions of people every year, and the use of the beaches and seawall alone generate between $145 million to $170 million in local output.

The report adds that an oil spill in May would be far more detrimental than a spill in October as approximately half of the “ocean-based” economic activity occurs during the late-spring and summer months.

“Total economic losses resulting from a May spill are estimated to be 115-175 percent higher than those from an October spill,” the report states.

However, the costs could be significantly greater as the study does not account for the potential costs from a socioeconomic level, local non-tourism businesses, spill response and clean-up, and litigation.

“Ocean-dependent economic activities in Vancouver encompass only a portion of the local economy that could experience losses from a hydrocarbon spill in the Burrard Inlet. Still, the potential impacts of an oil spill runs into hundreds of million dollars.”

Researchers also created animations depicting two different scenarios of oil spills in Burrard Inlet occurring at the First Narrows (near Lions Gate Bridge) and the Second Narrows (near Iron Workers Memorial Bridge).

In both animated scenarios, oil ‘flushes’ in and out of the fast moving tides of the First Narrows, causing oil to spread rapidly across Burrard Inlet in just a matter of hours.

The report is part of the municipal government’s ongoing campaign to provide the federal government’s National Energy Board with information on the potential risks of permitting Kinder Morgan’s Trans Mountain pipeline expansion proposal, which begins in Edmonton and ends at the Westridge Marine Terminal at the foot of Burnaby Mountain.

If the pipeline project is approved, existing pipeline capacity would be tripled from the current 300,000 barrels per day to 890,000 barrels per day. The number of oil tankers in Burrard Inlet would grow from five to 34 per month.

First Narrows Burrard Inlet oil spill model

Second Narrows Burrard Inlet oil spill model

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Kenneth Chan Deputy Editor & Social Media Manager at Vancity Buzz. He covers stories pertaining to local architecture, urban issues, politics, business, retail, economic development, transportation, infrastructure, and anything else that makes a difference in the lives of Vancouverites. Kenneth is also a Co-Founder of New Year's Eve Vancouver. Connect with him at kenneth[at]vancitybuzz.com
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