About FRANKLY SPEAKING
Beach Access: An Opinion
Resident Tourism Policy
Paralysis by Analysis
Oil Refinery - Facts or Fiction?
An Oil Refinery for Dominica? - Part 2
A Place Called Home
Annual Awards Gala - DHTA
Dominica Cabinet - 2010
Thanks But No Thanks
The People's Business
Politics of Water
Message in a Bottle
Between the Lines
The 24/7/4/12/5 Campaign
The Answers Within
Foreign Direct Investment
CSME - Where now?
"En Brera" - No Choice
Closure of OECS, Ottawa
Does Size Matter
Growing DA's Agriculture
A University of Dominica?
Made In Dominica?
© Frank Watty
An Oil Refinery for Dominica? - Part 2
Small islands are exceedingly fragile ecosystems. Small islands that are characterized by high mountains, deep valleys, heavy rainfall, extensive and dense forests, diffuse water catchment basins, diverse plant and wildlife are even more sensitive to the impacts from ecological disturbances.
Small islands which in addition have populations and economies heavily dependent on natural resource exploitation activities such as agriculture, forestry, fishing, nature based tourism, and whose products are largely intolerant of exposure to high levels of air or water-borne pollutants need to be very careful. Islands engaged in the active promotion of organic farming as a niche market in a competitive world must resolve the inherent contradiction of simultaneously accommodating a potential pollutant within its small area. It needs to be careful of the results from negative impacts on the biotic systems which are the basis of natural productivity, through impact on the food chain, through entry into the potable water system, through direct contact with produce, animals and humans.
Such a small island is Dominica!
In its consideration of the merits of establishing an oil refinery on the island, Dominica needs to proceed with extreme caution. This is not to suggest that the very idea of an oil refinery for Dominica should be dismissed out of hand. One suspects that if commercially viable oil deposits were found on Dominica itself or if there were proven deposits on Bird Island (a Dominican possession, though in contention), the nature of the debate and the level of opposition would have been far different. Few would actively advocate the export of any derived "value added" from oil refining to a foreign jurisdiction unless, and only unless, the implications for establishing such a facility on Dominica was devastating and unsustainable.
Not undeservedly is the Mississippi River corridor for some one hundred miles through Louisiana nicknamed "cancer alley". This is a label attributable in part to the effects of oil refining operations extended along this sector. It is true that many of these plants predated the stringent technologies and regulations that might have lessened or even avoided the worst of such impacts. True also, that improved levels of information and protection and the installation of required technologies and processes to mitigate such impacts are now available to the industry provided they can be required, applied, responsibly monitored and enforced. Yet, under any meaningful risk assessment analysis, it should surely be preferred that industries of this nature be located in jurisdictions having a larger landmass, where impacts can be better monitored, where there are more attenuation options and where there might be greater economic and ecological resilience.
Without the benefit of the specifics of this proposal, one can say that in general, an oil refinery may bring certain opportunities to an area. These might include, and are not limited to, land purchases (reduced by displacement costs), local employment, growth in incomes and expenditures related to site preparation, construction, operation and maintenance. But there may be valid questions on how extensive these benefits might be in the subject case.
In the absence of information to the contrary, one assumes that all construction materials, equipment and vehicles (except such as can be negotiated for hire, lease or purchase locally) will enter the jurisdiction duty-free. Similarly, one assumes that imported crude oil and refining chemicals and solvents would not be subject to taxation. If private wharves are constructed, one does not expect that related charges would apply, although, given current international tensions on port and harbour security, safety of cargoes, drug trafficking surveillance and interdiction, a heavy responsibility would have to be assumed by the local government authorities to ensure the integrity of the operator and of the country.
So what are the prime advantages of an enterprise such as this? Again, without the benefit of the information, one must further assume that depending on licensing agreements and other protocols, and the costs of local processing, there could be imputed charges placed on exports of refined oil and other by-products even up to the level of world prices less reasonable profits. But these are matters for astute negotiations between informed, knowledgeable and unconstrained parties. Part of this negotiation process could provide for the Government of Dominica in its own right or through one or more of its para-statal institutions such as the National Bank or the Social Security System to co-venture an enterprise such as this, with two obvious advantages. Firstly, an additional direct economic benefit would derive from the operation's success and the state would have a critical interest in ensuring such success. This deserves some consideration given the limited opportunities for local investment demanding attractive returns to meet social obligations. The second would be that the Government of Dominica or its institutions would be entitled to have access to all information affecting the operations of this investment. This proposal might be a deal-maker or deal-breaker contingent on other factors under consideration. But so far, we are not privileged to what these might be! While for purposes of this discussion, one may speculate on these options, it is not sufficient for Government to consider them in the abstract. The implications must be the subject of insightful analysis and be decided on the basis of an explicit, measurable and documented assessment.
One should not discount the possibility that an operating and successful oil refinery could in the long run be a catalyst for a variety of secondary, spin-off operations such as chemicals and plastics production, fertilizers and pharmaceuticals and synthetics of various kinds. If this is anticipated, feasible and properly planned, immediate efforts could be undertaken to develop a cadre of trained and experienced nationals who would be crucial to pursuing such options either independently or under licence. But this cannot remain as conjecture or wishful thinking. Some hard assessment is required even in a preliminary way, to build such a possibility into the equation at this stage.
From all appearances, the oil refining proposal is most strongly objected to or questioned because of anticipated environmental impacts. The responses to these concerns have so far been pathetic at best, even if it is the most critical for the sustainability of the island. We must assume that it is not intended that the oil refinery will replace and displace all pre-existing economic activity on the island. If therefore it is to operate alongside traditional and developing economic sectors, it is important that it not devalue or threaten them. It may even be possible that the refinery is able to contribute to and support other sectors and vice-versa. Oil refining impacts (good and bad) should be traceable on the island's ecology at the three stages of construction (pre-operation), post-construction (during operation) and post-operation (de-commissioning).
The examination should have regard for the relative advantage of an east-coast versus a west-coast location; off-shore and on-land construction; new roads and road widenings as a result of the plant; energy sourcing for start-up operations. An ecological assessment recognises that construction and operations will have a disturbing effect on the biota and natural conditions which support such life forms (including human beings). These natural conditions are complex biological processes and habitats that do not easily recover when once disturbed. The analysis should further recognize the hierarchy of relationships existing in nature such that disturbances have effects sometimes destroying the food chain and eradicating commercially viable activities. Sometimes these impacts have the effect of spreading to and affecting areas far removed from the original point of origin. Where the initial cause of disruption is capable of travel directly (air plumes) or indirectly (water-borne pollutants) the adverse impacts are so much more widespread, uncontrollable and severe. In this regard, some particular activities would be of special interest to decision-makers.
(a) Land clearing, grubbing and resulting site configuration;
(b) Excavation, blasting, drilling etc;
(c) Concrete pouring (in and out of water);
(d) Dredging, pile driving and filling;
(e) Water taking, amount and sourcing and disposal;
(f) Construction on-land and off-shore.
Production and refining operations should require an upfront assessment of potential impacts on workers' health and safety, on adjacent lands and communities primarily as a result of air emissions and transmission of pollutants; contamination of water used for processing and its release into the environment; chemicals and by-products such as tar released on-site inadvertently or because of accidents, which may subsequently be dispersed by storm flows overland or sub-surface.
While in no way suggesting that any or all of the following will inevitably result from the proposed oil refinery, and recognising too that depending on in-place controls and monitoring protocols some of the hazards can be contained, if not removed, potential impacts based on experiences from other locations may be instructive:
(a) Inhalation of airborne chemicals giving rise to pulmonary dysfunctions, respiratory diseases, mental retardation in infants.
(b) Ingestion of atmospheric depositions on fruit and vegetables or in drinking water, creating incidences of diarrhea, mental retardation in infants and poisoning.
(c) Atmospheric pollution resulting in haze and causing decreased visibility and loss of scenic enjoyment. Also environmental diffusion of offensive odour.
(d) Contaminated depositions on soil or in water affecting reproductive functions of fish and animal life and reducing soil fertility.
(e) Fumigation potentially resulting in decreased rates of plant growth and reduced yield of crops and forests.
The severity of such impacts and their relevance in this case depends on the specifics of the proposal. Obviously, all of the above are not applicable in every case. This emphasises the importance of information applicable to each case, as the basis for realistic assessment and for remedial action, if required.
Whereas on the one hand the risks indicated above appear to be alarming, it should be noted that increasingly the technology is becoming available to avoid the worst of these pollution and contaminating hazards. But these processes and adaptations are expensive and seldom incorporated even in home countries unless the force of legislation, control, supervision, prosecution and penalty exists and is rigorously applied. Accordingly, it is tempting for profit-led corporations to export the problem to jurisdictions which are less demanding in standards of performance.
Lastly, nothing is known at this stage of the source of the crude to be processed at the proposed plant. In industry circles, there is talk of new oil exploration fields in the Orinoco region from which such supplies might come. It is also rumoured that this source material is generally of a lower grade quality with as yet an undetermined chemical content. However, it has been concluded that this material is likely to require more extensive refraction and refining, and is potentially more polluting. These specifics have not been disclosed! The scale of the plant and the expected throughput have not been released for public information, so in the overall, the potential scope and range of impact must also be left to speculation.
The structure of the Venezuela oil exploration, extraction and refining sector suggests a close relationship between government and the entities charged with the commercial transformation of these resources. From all indications, the Venezuela government is embarked on an aggressive program of regional community building (The Bolivarian Alternative for the Americas-ALBA, program). Under the circumstances, one would need to temper question of exploitation by Venezuela with the furtherance of ALBA objectives through the proposal for an oil refinery for Dominica. However this is insufficient consolation to a government charged with a prime responsibility to its people of informing, consulting, educating and leading them in a democratic manner. It therefore seems ludicrous not to divulge aspects of the discussions on the proposal which do not prejudice the country's negotiating position. It would be equally advantageous to conduct a public consultation program which presents as much of the facts as can be presented and allow the public to contribute to the discussion on an issue of such major significance to the country.
There will be the cynics who will suggest that all of this information sharing and consultation and analysis are just so much bumpf-a waste of time, a diminution of government's right to make decisions. Yet, those same cynics are the ones who advocate the role for aggressive private investment in the national economy and recognise that a democratic society requires the knowledgeable participation of all segments of the community to achieve national objectives. All segments of the nation must be intelligently informed and involved. Some will ask, "why do we need all this stuff?" After all, we did not require it for decisions to construct our cruise ship berths; we tapped into the Fresh Water Lake without it; we did not demand it for airport construction and renovation. Look, we built the National Stadium without it and are contemplating major cross-country road improvements without it. No one is demanding it for current proposals or improvements. It was not necessary for the location and operation of our solid waste disposal site or for construction of our fishing ports. All of this is true, and we should ask ourselves, are we satisfied with what has resulted without this more broadly based technical and community assessment. Would the results have been better with such a process? Given the seriousness of the risks that we now face by this refinery proposal, can we act blindly or on incomplete information?
The last issue is perhaps the most disturbing. Does Dominica have the means of ensuring continuing obligation from Venezuela to honour any agreements on construction, operation, product delivery and pricing which may be entered into by the Venezuelan investors? The different political environments which pertain in South America, in general, and the sometimes volatility of their ruling regimes demand some re-assurances, despite the most benevolent intentions that may be presumed from the current leader. This is not to "look a gift horse in the mouth" but to take seriously the announced accusations by the Venezuelan government of active conspiracies by outside interests to destabilize the country and even to remove its present leadership, and to reverse its policies and programs.
Is the nation satisfied or unconcerned by the process to date? Are persons like myself, living at a distance, raising alarm bells where no threat exists? Are we to be accused again by influential interests of introducing "paralysis by analysis" with no discernible benefit? If there are concerns in the local community surrounding the lack of information such as discussed above, why then the absence of a more balanced, intelligent, public debate by the Dominican public? I have no thoughts on whether or not the matter should be decided by the public through referendum or some other means. I do not dispute the right of the elected government of Dominica to decide the issue subject always to eventual democratic sanction, if required. But I would have expected that the details of the matter having been fully disclosed for public knowledge and input, would at least be debated in the country's parliament. If this is not to be, one might as well close up the building and send the members home. They have outlived their usefulness and deserve neither the public trust nor have they earned their pay.
The writer, W.R.Franklin Watty, a Dominican national, is a professional economist, land use planner and tourism consultant. He is a former economist and planner with the Province of Ontario; and, the former Director of Planning and Transportation for the Regional Municipality of Waterloo, Ontario, Canada. In addition, he has served for twelve years as a professional adjudicator,mediator, negotiator and arbitrator in the Ministry of the Attorney General, Government of Ontario. He is currently retired from the Public Service; is the Principal of FRANK WATTY CONSULTANCIES INC., economic, land use and tourism planners; and, is Adjunct Professor, School of Urban and Regional Planning, University of Waterloo. He can be reached at email@example.com