INDUSTRY AND TRADE - SPRING/SUMMER 2020

Thursday, April 23, 2020

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INDUSTRY AND TRADE

Industry And trades

SPRING/Summer 2020

Industry in our region

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Inside

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Lifestyle, low pay behind

trucker shortage .................................................................................................................

pg 4

Local businesses

adapting to covid-19 ............................................................................................................

pg 7

$350 Million

Hemp facility planned ......................................................................................................

pg 8

Ministry looking to

change forestry inventory system .............................................................

pg 12

First Nations, industry

cooperation needed in resource sector ..............................................

pg 13

Forestry

training offered .....................................................................................................................

pg 14

LNG

workforce to soar .............................................................................................................

pg 17

Benefits-sharing

proposal made .......................................................................................................................... a Division of

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A logging truck heads into Lakeland mill along River Road. (Citizen file photo)

Lifestyle, low pay behind trucker shortage, local expert says

Arthur WILLIAMS, Prince George Citizen

The trucking industry is a facing a shortage of 20,500 drivers nation-wide – a

138 per cent increase since 2016 – according to a report released by Trucking HR Canada on March 11.

In 2019, the job vacancy rate

for truckers was 6.8 per cent – double the national average of 3.3 per cent – and 9.4 per cent for long-haul truckers.

Unless something changes,

the national, non-profit agency expects the number of vacancies to increase to 25,000 by 2023. In 2018, the shortage of cont. on page 5

cont. from page 4

drivers cost the Canadian trucking sector $3.1 billion in revenue.

“There is always companies looking to fill those (trucker) jobs. I’ve seen job postings for 100 people at a time,” Bailey said. “I’m looking at recruiting from Dubai.”

Despite the downturn in the forestry sector, major projects like the Site C dam and construction of the Coastal GasLink pipeline are attracting drivers away from other sectors.

“We’re talking about billions of dollars. It’s hard for the forestry guys to keep up with it,” he said.

Those major projects are unionized, he added, and draw their drivers from union call lists.

The problem is not about the number of trained drivers available, it’s about keeping them behind the wheel.

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I’ve got some trucking companies with a 100 per cent turnover rate.

“What we’re seeing is not a shortage of skilled people.

We’re training about 30,000 Class 1 holders alone (each year in Canada). In B.C. we’re doing 4,500-plus a year, on average. There is

“

only 44,000 trucking jobs in the whole of B.C.,” Bailey said. “It’s a hard lifestyle. A lot of it is at night. Truckers are working (up to) 14-hour days. You’re just driving and sleeping. (And)

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the younger generation just isn’t doing it.”

A significant number of trained drivers never end up working in the field, or leave after a short time, he said.

In its report, Trucking HR Canada identified a voluntary turnover rate for drivers, a lack of millennials going into trucking and a low participation rate by women as some of the major barriers to filling vacancies.

“I’ve got some trucking companies with a 100 per cent turnover rate,” he said.

Bailey is a member of the Commercial Vehicle Training Association and is a member of the provincial steering committee developing a mandatory entry-level training program for Class 1 drivers in B.C. Consultations on the proposed training program began in 2019.

Across the province 3,741 cont. on page 6

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Lifestyle, low pay behind trucker shortage, local expert says cont. from page 5

people earned their Class 1 licence (for full-size tractor trailers), 1,050 got their Class 2 (bus driving) and 1,499 received their Class 3 (three-axel trucks) in 2017, Bailey said.

“They’re not staying with the industry. It’s not employee friendly,” he said. “Lifestyle is a big thing, especially for guys with kids. I know guys who’ve never been to their kids’ birthdays and stuff, because they’re on the road.”

The lifestyle challenges could be part of why only 3.5 per cent of truckers are women, Bailey said.

“We get about half a dozen (women) that come through the program a year. I’ve got three trucking

companies that hire just women, because they show up to work. They’re safetyconscious, good drivers – dependable drivers,” Bailey said. “(But) the women I know in the sector, they’re not married. They’re single women, they don’t have kids.”

There are things that companies can do to improve the work-life balance for truckers, like changing routes to minimize the number of nights the driver spends away from home, he said.

But it will always be a tough job, he said, and it should pay accordingly.

“An owner-operator should be to earn $30 an hour (after expenses). He’s got his life

on the line, and he’s got his house on the line too,” Bailey said. “If you get that, where a guy can make a good living, we’ll have drivers at the end of the day.”

The biggest challenge is that costs for independent owner-operators have grown significantly, he said, while mileage rates have remained fairly flat.

A truck that cost $120,000 in 2007 could cost almost $250,000 after taxes today, he said. Fuel has nearly tripled in price, he said, and the costs of maintenance and insurance have risen as well.

Bailey said, in his view, a legislated $3 per mile minimum mileage rate would help ensure independent

operators can stay afloat.

“If we got it so someone serving coffee at Tim Hortons is making $15 an hour... we should be able to do the same for truckers. But some aren’t even making that – some are making $10 an hour,” Bailey said.

Sadly, he said, many truckers don’t have the business background to properly track their expenses and plan for depreciation and maintenance. For them, becoming an owner-operator can be a slow slide into bankruptcy.

“I said to one company, ‘It’s like a cancer.’ It takes (a driver) three years to figure out he’s losing his house, his family, everything.”

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Local businesses adapting to COVID-19 pandemic Arthur WILLIAMS, Prince George Citizen

The COVID-19 pandemic – and the public health measures put in place to combat it – are having a major impact on how local companies do business, Prince George Chamber of Commerce CEO Todd Corrigall said.

The outbreak is challenging businesses at every level – from massive, multinational corporations down to local family businesses, he said.

“Everything a large business is thinking about, a small business is facing too,”

Corrigall said. “If your budget is $50 million or $50,000, you’re facing the same things.

It’s just a matter of scale.”

Many businesses in the city have already announced temporary closures, reduced hours or restricted operations – like restaurants offering drivethrough or pick-up service only.

How big an impact that will have depends on the nature of the business, Corrigall said.

“Retail has an obligation to their bottom line to remain open,” he said. “(But) a small business that is office based,

like an engineering firm, you’re not relying on walk-in traffic. It’s much easier to find solutions (for staff) to work from home.”

Local businesses are looking for innovative ways they can continue to deliver services, even if not in the usual format, he said.

The chamber of commerce’s web site (www.pgchamber. bc.ca) will host a list of local companies that are currently open, and what services they are offering.

The announcement of government stimulus packages

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to help the economy through the crisis are good news, Corrigall added, but it will depend on how easy those programs are to access and what they offer.

At the end of the day, what businesses need “is money,” he said.

“For a small retail store trying to pay their staff it might be a short-term bridging loan (that is needed,)” he said.

“Hopefully the government will continue to work with other levels of government and business to make sure people are getting the help they need.”

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$350M hemp facility planned Arthur WILLIAMS, Prince George Citizen

BC Hemp CEO Micheal Fazakas speaks at the company’s official launch in Prince George on March 11. (Citizen photo by Arthur Williams)

A planned industrial hemp facility at the corner of Johnson Road and Old Cariboo Highway is expected to create approximately 1,500 jobs in Prince George.

BC Hemp Corp. announced plans on March 11 for a $350 million facility at its new head offices on the former site of Ritchie Brothers Auctioneers, just down the road from the proposed facility. Production is expected to start within two years, with a focus on hemp fibre and grain for hempbased products like textiles

and food products.

BC Hemp CEO Micheal Fazakas said the project could be a “life-changing” development for the city. “(But) we cannot do this without community involvement,” Fazakas said.

“We can build a stronger Prince George, we can build a stronger north.”

The 1,500 jobs represents direct employees, he said, with an estimated annual payroll of $75 million.

Fazakas said he expects preliminary work to start on the site this year, with construction to begin next year. The overall timeline to cont. on page 9

cont. from page 8

start product is three or four years.

The company has already begun reaching out to farmers, who would produce the hemp crop for processing, he said. Several places around the city have an excellent climate for growing strains of hemp used for making textiles.

BC Hemp will function as a subsidiary of the Healx group of companies, he said, which will produce a variety of hemp-based products ranging from protein shakes to CBD oil capsules. The company is also planning to open a multi-service health clinic in Prince George, which is expected to open later this year.

“There are many reasons for choosing Prince George, including the central location and the climate for growing hemp,” BC Hemp president Remi Balaj said in a press release. “It was perfect for a hemp hub.”

Fazakas said the proximity to the airport, rail lines, to the Port of Prince Rupert and highways makes the city strategically placed to move their products wherever the demand is.

“The city is literally a crossroads,” he said.

The company is “very close” to having all the permitting and funding it needs in place to bring the project to realization, Fazakas added.

Part of the facility on Johnson Road will include a 100-acre agricultural test site to test different varieties of hemp crops and cultivation methods.

The company’s five-year plan calls for 300,000 acres of farm land producing hemp in northern B.C. to supply the planned processing facility, with a focus on organic production.

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“Soil health is key to our long-term plans,” BC Hemp’s Chris Hatfield said in a press release. “We want to make a lasting, positive impact on agriculture in the region, and that all starts with the soil.”

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The longterm plan is to help develop hundreds of local businesses that use hemp to develop their products

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vBC Hemp is looking to work with farmers, First Nations and communities in the north to promote hemp cultivation and secondary businesses producing products from the fibre, grain and oil. Products which can be made from hemp fibre include clothing, rope, netting, paper and building materials.

Hemp grain and oil are used in products like protein flour, food supplements, birdseed, soaps and beauty products.

The company expects to sell processed material at “very competitive rates” to promote local production of finished hemp-based goods.

“The long-term plan is to help develop hundreds of local businesses that use hemp to develop their products,” BC Hemp’s Istvan Kapacs said in a press release. “In the last few (months) we have already had both international and domestic companies who want access to our products.”

Mayor Lyn Hall said the cont. on page 12

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Hemp project has potential cont. from page 9

project has the potential to “put us on the map” as a place for emerging industries to develop.

“One of the things I’m most interested in is the potential impact in Prince George,” Hall said. “(I) look forward to seeing the snow disappear and construction start.”

MLA Shirley Bond said she is excited about the opportunity for northern B.C. “I consider this project to be an innovative agriculture project,” she said.

In addition to offering farmers a new, potentially

profitable crop, Bond said, the potential for 1,500 additional jobs in northern B.C., could change the lives of many Prince George families.

Prince George Airport Authority CEO Gordon Duke welcomed BC Hemp to the Old Cariboo Road neighbourhood.

“It’s a really good fit,” Duke said. “The sheer number of products that can be made from hemp is really impressive. When the time comes to start shipping B.C. hemp to ports all around the world, we’re ready.”

Doug Donaldson, Minister of Forests, Lands, Natural Resource Operations and Rural Development, makes an announcement in Prince George in September. (Citizen file photo)

Ministry looking to change forest inventory system Arthur WILLIAMS, Prince George Citizen

The province is investing in improvements to the way forest inventories are conducted to open up new opportunities for investment.

Minister of Forests, Lands, Natural Resource Operations and Rural Development Doug Donaldson said the changes are about attracting companies interested in biomass for purposes other than producing dimensional lumber.

“It’s difficult to attract investment if you can’t show what kinds of biomass are available,” Donaldson said.

“Most of our inventories are designed with the focus that the final product is

dimensional lumber – saw logs.”

The improved inventory system under development will look at all the biomass values available on the landbase, he said. The wood pellet industry is just one industry interested in accessing woody biomass to produce alternative products.

While dimensional lumber will continue to be part of the industry in B.C., the province is going to have to adapt to the changing nature of the forest resource on the landbase and look for innovative new ways to create jobs and support communities.

“As a government we need to ensure the feedstock is there,” Donaldson said.

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First Nations, industry cooperation needed in resource sector

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First Nations Major Projects Coalition executive director Niilo Edwards speaks at the coalition’s third annual Industry Engagement Event held in Prince George in March.

(Citizen photo by Arthur Williams)

Arthur WILLIAMS, Prince George Citizen

Cooperation between natural resource industries and Indigenous people is the key to a successful future for both groups, according to the head of a coalition aimed at just that.

First Nations Major Projects Coalition executive director Niilo Edwards was one of the speakers at the coalition’s annual Industry Engagement Event held in Prince George in March.

The third installment of the conference drew more than

200 delegates, including 93 First Nations representatives.

“There is a realization that if we’re going to have a new framework as a nation, First Nations have to be part of the conversation, be part of the solution,” Edwards said. “We aren’t without our challenges, but this is a start.

The ultimate goal here is to get feedback to do better.”

The coalition was created by First Nations looking to find ways to take advantage of, and be part of, the economic activity in their traditional territories. cont. on page 15

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Forestry training course offered

Blaine Lortsen makes a cloud of chips as he competes in the chainsaw event at the loggers’ sports at Forest Expo in 2002. Chainsaw operation is one of the skills a free forestry training program will be teaching. (Citizen file photo)

Arthur WILLIAMS, Prince George Citizen

A free forestry training program funded by the provincial and federal government will teach people skills still in high demand, despite the downturn in the sector.

The first class of 12 students started the 19-week program on March 30, learning skills like chainsaw and brush saw operation, pesticide application, silviculture surveying, occupational first aid, forestry field skills, ATV operation, bear safety and more. Two more classes will be offered following the first, Stillwater Consulting president Jody McInnes said.

Stillwater has been hired to offer the program to students who meet EI eligibility and live in Prince George or the surrounding area.

“We’ve been hearing from employers up here for years.

The timing was good,” McInnes said. “We thought this would be a good fit with the job opportunities up here.

We never want to train people for no jobs.”

Part of the process to get government funding required getting letters of support from regional employers, he said, and while normally that can take weeks they received

enthusiastic support from local companies within a few days.

Graduates from the program in other parts of the province have seen 90 to 95 per cent employment, McInnes said.

“That gets people excited,” he said. “Past experience is great, but not necessary. We’ve seen people transition from the manufacturing side to working in the field. We saw some of that on the island.

They were working in mills that had shut down...”

Students have gone on to work as junior forestry technicians, wildfire firefighters, silviculture surveyors, working on major industrial projects clearing and building roads and other jobs, he said.

“Some have gone into the recreation side – trail building, trail maintenance,” McInnes said. “We’ve got people working in parks and rec, doing silviculture in downtown Vancouver.”

The free training program includes tuition, safety equipment and learning materials. For more information, go online to www.stillwaterconsultingltd. com or contact the Prince George WorkBC Centre at 236-601-9111.

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cont. from page 13

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We aren’t without our challenges, but this is a start. The ultimate goal here is to get feedback to do better

“Industry is coming to the realization that there is a whole lot of opportunity out there now (to partner with First Nations),” he said.

Participation can take part in a number of ways from equity ownership in the project to First Nations businesses working as contractors for the company.

“When you’re empowered to make your own decisions based on your community’s values, that’s what First Nations want,” he said. “You get to create an economy where you’re starting to provide your own services.”

Ken Coates, a professor of political

science at the University of Saskatchewan and Canada Research Chair of Regional Innovation, says public policy will play a big role in the success of Indigenous partnership in resource development. It is important to ensure government policy is used “like a weapon” against First Nations, he said.

“It’s very important to get public policy right,” Coates said. “Canada always supports Indigenous rights, as long as they don’t have them.”

Instead of dealing with the broader issues of Indigenous title, Canada has

“

largely left it to the courts to deal with claims on a case-by-case basis, he said.

That’s not an effective, long-term approach and one that has resulted in conflicts like the stand-off between the Coastal GasLink natural gas pipeline project and a small group of Wet’suwet’en hereditary chiefs. “(And) it’s a legal obligation. You have no choice,” Coates added, referring to rulings by the Supreme Court.

“Indigenous people are in the process of buying back Canada, and I think that’s wonderful.”

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The current Kemess site and facilities are seen in 2015 in a Centerra Gold handout image. (Centerra Gold handout)

Proposed mine could deliver jobs

Arthur WILLIAMS, Prince George Citizen

A proposed underground mine approximately 500 kilometres north of the city could bring hundreds of jobs to Prince George.

Centerra Gold sustainability

and community development manager Joanna Miller updated the Regional District of Fraser-Fort George board about the Kemess Underground project on Feb. 20. The Canadian mining company currently operates

the Mount Milligan copper/ gold mine west of Mackenzie and owns the shuttered Endako molybdenum mine 17 km west of Fraser Lake.

The proposed Kemess Underground copper and gold mine would be located six kilometres from the nowclosed Kemess South open pit mine, Miller said. Between 1998 and 2011 when it closed, the Kemess South mine produced three million ounces of gold and 750 million pounds of copper.

The new Kemess Underground mine would use much of the same infrastructure as the former open pit mine, Miller said, reducing the cost and footprint of the mine.

“This (Kemess Underground) is a fly-in, fly-out operation.

Kemess Underground will fly in and out of Prince George.

We previously flew out of Smithers,” Miller said.

During the four to five year construction period, the mine would employ approximately 575 people, she said. Once complete, the mine would employ approximately 475 people full-time on a two weeks in, two weeks out rotation for the 11-year life of

the mine.

The proposed design is for a block cave mine, she said, which means tunnels will be dug 200 metres to 500 metres beneath the surface and the mine will then dig up into the gold and copper deposit from underneath.

“It’s a bit of an interesting way to mine. There is no impact on the surface,” she said. “All that will be visible on the surface is a slight depression.”

Once operational, the mine will process 25 to 35 tons of ore per day, Miller said.

The proposed Kemess Underground mine has now received all regulatory approvals and is just waiting on the Centerra Gold board of directors to approve starting construction, she added.

Miller also offered an update on the status of the closed Endako mine. The molybdenum operated from 1965 until it was closed in July 2015, because of low prices for the metal.

“As of right now we have no plans to restart that mine,” Miller said. “It does have about nine years of mine life left, and when the price of moly changes we’ll reopen that mine.”

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LNG workforce set to soar

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Arthur WILLIAMS, Prince George Citizen

Peter Zebedee, CEO of LNG Canada, was one of the speakers at the #Truenorth Business Development Forum in Prince George in January. (Citizen photo by James Doyle)

The top bosses of Coastal GasLink and LNG Canada expect to have thousands more employees working on their respective projects by the end of this year.

Coastal GasLink president David Pfeiffer said 2020, 2021 and 2022 will be the major years for constructing the pipeline.

“We’ve got about 1,000 (people) working on the project now,” he said. “We’ll ramp up to about 2,500 this summer.”

LNG Canada CEO Peter Zebedee said his workforce will double.

“We just finished what we call our pioneering work, cont. on page 19

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Benefits-sharing proposal made Arthur WILLIAMS, Prince George Citizen

The First Nations Major Projects Coalition is calling on the federal government to consider its eight recommendations as part of a new benefits-sharing framework for resource projects in the traditional territory of First Nations.

In December, Prime Minister Justin Trudeau identified the need for a new benefitssharing framework as a priority for his government.

The coalition put forward its recommendations during the group’s annual Industry Engagement Event in Prince George last week.

“Effecting real change and progress can not be done by one party working in isolation,” coalition chairperson Chief Sharleen Gale said. “The government could not have a better partner than First Nations.

Decisions that we make in our communities are from the land up.”

Gale, who is the chief of the Fort Nelson First Nation, said Indigenous groups have traditionally faced, and continue to face, significant barriers to participating in development on natural resources in their traditional territories.

Many of the organization’s

member First Nations are interested in buying a stake in projects in their territories, but access to financing can be a major barrier, she said.

“Equity ownership offers a chance for our nations to fully take part in the mainstream economy,” Gale said. “When a First Nation is doing good, the benefits trickle up to the community.”

Chief Corrina Leween, of the Cheslatta Carrier Nation, said her nation bid on purchasing a stake in the Coastal GasLInk natural gas pipeline project, but weren’t able to secure the capital they needed.

“Cheslatta was squeezed out because the cost of capital was uncompetitive,” Leween said.

“We don’t want to be squeezed out of another opportunity on our lands. We want to be able to collaborate on projects... and to have a seat at the project governance table.”

The coalition made the following eight recommendations for the federal government as it looks at its new benefit sharing framework: 1) Leverage available tools within the federal fiscal framework to establish a program designed to support Indigenous groups with access to capital (such as loan guarantees) for a wide variety of resource projects.

2) Ensure maximum flexibility of those tools and programs to be able to support Indigenous groups with ownership objectives over a wide variety of project dynamics and asset classes.

3) Develop and sustain an Indigenous major projects

capacity fund to support Indigenous communities with professional advice and counsel necessary to undertake independent due diligence on projects.

4) Engage with Indigenous nations and Indigenous organizations on the development of qualifying criteria to define the size and scale of major projects and determine how the national benefits sharing framework would support Indigenous involvement in those projects.

5) Engage with Indigenous nations and Indigenous organizations who have direct experience participating in the commercial aspects of major project development on the design of a national benefits sharing framework.

6) Establish a jointengagement and collaboration with industry and institutional sectors to support First Nations equity ownership across all sectors in the context of Indigenous rights and reconciliation.

7) Work with First Nations to design the appropriate mechanism that ensure benefits flow to communitylevel projects.

8) Ensure that benefits are established in a setting that confirms a rigorous and robust environmental review process that adheres to standards adopted by First Nations communities.

The Association of Consulting Engineering Companies — Canada and the Canadian Council for Public-Private Partnerships both supported the proposed recommendations.

Thursday, April 23, 2020 cont. from page 17

“

We’ve got about 1,000 (people) working on the project now, ...

We’ll ramp up to about 2,500 this summer

clearing the land. We ended the year, 2019, with just under 1,500 people on the site,” Zebedee said.

“We expect to have 3,000 workers on site by the end of the year.”

The two industry leaders were in Prince George in late January for the #TrueNorth Business Forum.

Coastal GasLink is building a 670-kilometre natural gas pipeline from northeast B.C. to Kitimat, to serve the LNG export terminal LNG Canada is building. The combined value of the project is estimated at $6.6 billion.

Pfeiffer and Zebedee started off addressing the elephant in the room: the ongoing opposition by a group of Wet’suwet’en hereditary chiefs and their supporters.

From day one, Coastal GasLink realized the importance of getting social licence from the communities and First Nations along the pipeline route, Pfeiffer said.

“

“We held meetings with all 20 of the nations (along the route), both elected and hereditary,” Pfeiffer said.

“In most of the nations, the elected and hereditary systems work together very well.”

Those meetings have resulted in cooperation agreements with 20 First Nations, including elected councils representing some of the Wet’suwet’en First Nations like the Skin Tyee First Nation.

“One third of our fieldwork was done by Indigenous people, Indigenous companies, in the north,” Pfeiffer said. “It’s just such a great story.”

Pfeiffer said the company is still hoping to find a permanent resolution to the dispute with the Wet’suwet’en.

“The reality is, I really want to emphasize, that adequate consultation has occurred,” Zebeedee said.

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