Potash v. Natural Gas

This is good news.

The New Brunswick government triumphed over rival locations to secure a US$1.6-billion investment by the Potash Corporation of Saskatchewan Inc. to build a second mine in Sussex that will generate 140 new full-time jobs. Premier Shawn Graham joined Garth Moore, president of PCS Potash, at the surprise announcement on Friday morning shortly before stock markets opened. Potash Corp. is the world’s largest fertilizer company and this investment will boost its New Brunswick potash production to two-million tonnes annually from 800,000 tonnes.

140 jobs. Wouldn’t it be neat if we could attract the users of that potash to do some manufacturing here?

But there is another learning here to be sure. Here’s an excerpt:

Starting in January, Arseneault (the Minister) said his staff, particularly Barry and Sam McEwan, the department’s director of minerals and petroleum development, worked tirelessly at developing the royalty holiday incentive package. The minister met with Moore in New Brunswick on four occasions and lined up meetings with the ministers of environment and Business New Brunswick.

Hmmm. We work ‘tirelessly’ to develop a ‘royalty holiday incentive package’ for potash while at the same time show complete disinterest to develop a ‘royalty holiday incentive package’ to make some use out of the natural gas that is located in that very same area.

I know for a fact that local stakeholders were petitioning the government to come up with a ‘royalty holiday incentive package’ for natural gas to encourage economic development.

I find that curious. Anyone have an explanation?

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2 Responses to Potash v. Natural Gas

  1. Anonymous says:

    There’s a very easy explanation. All you have to do is look at who benefits.

    Think about this, a ‘royalty free holiday’, what does that say? It says they are giving away the potash for FREE, and of course to get it for free they have to get it out, which requires more people.

    And even moreso that oil, potash is a non renewable resource, which means once its gone, its gone, and those workers are once again unemployed.

    However, ask yourself this, since you are always complaining about the resource sector and how its a dead end (as it currently operates), what if they WEREN”T given the potash for NOTHING, and instead that royalty money was spent to train workers in knowledge based industries or increase investment?

    So once again the province is forsaking long term security for short term jobs. Its funny that for some reason now you think that its GOOD news. Giving away a valuable resource for FREE is good? Wow, did I wake up in wonderland?

    Economically its a HORRIBLE idea. Keep in mind how much of this money goes straight back to Saskatchewan. You dont think New Brunswickers could figure out how to mine potash and sell it on the market? Its easy, you scrape it out and send it to St.John and out it goes.

    Like you say, at least they could have some regulations to get them to manufacture SOMETHING in NB out of the potash.

    Once again, this is NB literally saying to the world “we will do ANYTHING and I mean ANYTHING for jobs”. Now, does that sound like the sales pitch that decent companies will pay attention to? Keep in mind that potash is THERE, its not going anywhere, if anything NB has an edge. Imagine saying that “we did so great at securing an ‘investment’ to remove more of New Brunswick”.

    Potash royalties are the biggest cash cow the province has, even more than gas and forestry. These guys are clearly even dumber than Lord was, the PIT from those jobs will probably barely cover it, if at all. That’s the most bizarre way to become self sufficient that I’ve ever seen.

    It’s ‘good’ in that peculiar NB way where anything is good if it means a job no matter what it is and no matter what the costs. But again, that royalty money could have just been handed over to the animation guys in Miramichi and just imagine what they could have done with it.

    The gas deal of course means that investors get bilked. That’s exactly why people should be up in arms that these crazy people are literally giggling insanely at using your tax dollars to build more nuclear reactors-but not to make the province have cheap power to attract industry but to sell.

    In short, ‘your’ government represents large investors, and thats who benefits from policy. NBers may get lucky and get some jobs out of it, but keep in mind that its not like theres a contract that 140 people must have full time jobs for X number of years.

  2. Pingback: Good economic news for New Brunswick

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