Assessing the public interest in environmental assessment: lessons from cost-benefit analysis of an energy megaproject

Figures & data

Table 1. Frontier benefits and costs (base case).

Impact	NPV (2017CDN)
Revenue	+$21.7 billion
CAPEX	-$10.7 billion
OPEX	-$9 billion
Reclamation	-$16 million
Employment benefits	No incremental benefit
Air pollution	-$1.3 billion plus additional unmonetized costs
GHG damages	-$4.1 billion
Impacts on water resources	Cost (unmonetized)
Impacts on ecosystem services	-$733 million plus unmonetized cultural impacts
Additional impacts	Unmonetized impacts including: user costs; foreign investment benefits and profit leakage costs; costs of subsidies; and additional social and cultural costs
NPV	-$4.1 billion

Figure 1. NPV in base case and sensitivity analyses with 10%/3% discounting rates.

Figure 2. NPV in base case and sensitivity analyses with uniform 8% discount rate.

Table 2. Distribution of net benefits and costs (base case).

Stakeholder	Impact	NPV (2017CDN)
Private investors	Project revenue, project costs, royalties and taxes owing	-$2.9 billion
Government of Alberta	Royalties, Alberta corporate income tax, property tax	+$3.1 billion
	User cost, subsidies, and incremental government costs	Unknown
Government of Canada	Corporate income tax	+$538 million
	Foreign investment benefits and leakage, subsidies, incremental government costs	Unknown
Externalities: Alberta	GHG damages, air pollution, and ES impacts	-$2.1 billion
	Water impacts and other social costs	Negative
Externalities: Rest of Canada	GHG damages	-$12 million
Externalities: Rest of World	GHG damages	-$2.8 billion
Indigenous Communities	Adverse impacts on use of land and natural resources, economic benefits	Unknown

Table 3. Frontier economic impacts from the alternative perspectives of CBA and EconIA.^1.

CBA

EconIA^2

Base case results of -$4.1 billion NPV due to: $21.7 billion NPV in revenues, $20 billion NPV in capital, operations, and reclamation costs, No employment benefits, $6.1 billion NPV in environmental impacts, Various additional unmonetized costs Various additional unmonetized costs Various additional unmonetized costs Base case royalties and taxes of $3.5 billion NPV. Sensitivity analysis results ranging from -$44 billion NPV to +$5.3 billion NPV

‘Net benefits’ of $19.1 billion in GDP from construction and $2.2 billion annually during operations, 278,190 person-years of employment across Canada, $72.2 billion in royalty and tax revenues. No sensitivity analysis.

1. 2017 Canadian dollars. 2. See Teck (2015, Volume 1).

Figure A1. Price scenarios used in the CBA.

Sources: IEA (2017), NEB (2018a), Teck (2017).

Teck. 2015. Frontier oil sands mine project – project update EPEA application no. 001-247548, Water Act file no. 303079, CEAA reference no. 65505 and ERCB application no. 1709793.

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IEA. 2017. World energy outlook 2017. Paris, France: International Energy Agency.

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[NEB] National Energy Board. 2018a. Canada’s energy future 2017 supplement: oil sands; p. 20.

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