November 2014, Vol. 241, No. 11

Features

Having Our Backs: Laborers That Build North American Energy Infrastructure

May Va Lor is soft spoken and petite, but she can summon a lot of muscle when needed. Va Lor, a labor energy research expert, can turn on the same strength that has built the Alaskan oil and Rockies Express natural gas pipelines. She is equally adept at exercising that strength in the public policy corridors in Congress and state or local government chambers across North America. She is an excellent storyteller, it turns out.

In her role as the energy research analyst for the Laborers International Union of North America (LiUNA), Va Lor works to help shift the public debate on energy infrastructure as personified in the national and state campaigns opposing hydraulic fracturing (fracking) and pretty much any large oil or natural gas project. TransCanada’s controversial Keystone XL Pipeline is right in the center of her radar. And LiUNA continues to have a huge stake in all of the major recent and future natural gas pipeline efforts.

There are political and economic aspects to her efforts at LiUNA, which bills itself as a national and local advocate for “smart infrastructure investments,” the kinds that equate to thousands of solid-paying jobs. The international union maintains a Department of Corporate Affairs where Va Lor serves as an energy research specialist. She examines industries, companies and investments for the LiUNA pension fund trustees and affiliates, which have $35 billion invested in numerous defined benefit pension plans.

Many macro-economics statistics are at her fingertips as a result of her role with the pipeline workers. For example, she knows seven of 12 industries that are benefiting from the development of the Bakken, Eagle Ford, Permian, Utica, Marcellus and Niobrara shale plays. Va Lor also can recite the nearly $210 billion of proposed U.S. capital and maintenance activity this year, including $15 billion in pipelines, that equate to a 27.7% boost in construction starts for the year.

In supporting pipelines and their workers, Va Lor keeps track of the U.S. industrial spending outlook ($303 billion for 2015), which has experienced annual growth rates between less than 1% to nearly 10% during the past five years. And don’t talk to her about construction labor hour forecasts without reviewing the projections for everybody from electricians and welders to laborers and painters. Her numbers point to a 12.2% increase in 2015, compared to the previous year, and 22% for the 2013-15 period. She can tell you the projections in millions-of-man-hours for the dozen job specialties working on pipelines, from welders to boilermakers, and they are all projected upward, although the outlook for painters is relatively flat.

Va Lor has a veritable army behind her since LiUNA represents about 500,000 workers spread around more than 420 local unions in North America. It has training centers in all but a handful of states.

“Pipeline workers take a lot of pride in the work they do,” she told a regional energy forum in Chicago in September. She said pipeliners have a long tradition and are very supportive of various major energy projects in which they have a stake now and in the future.

From LiUNA’s vantage point, Va Lor said the longer term interest is broader than just pipelines, spilling over to the re-building of manufacturing facilities in the United States, driven by low natural gas prices. The pipeline workers support this reindustrialization throughout North America as good for the gas industry generally and their working compatriots specifically.

Echoing Va Lor at the same forum, the American Petroleum Institute’s (API) senior economic adviser and a chief spokeswoman, Rayola Dougher, said a key for the industry’s success is sustained engagement in the communities where wells are being drilled or pipelines installed. API has established a “community standard” for getting the job done.

“Trust you have to earn, and we earn it by our performance,” Dougher told an audience of mostly gas buyers and sellers. “It is not what we say, but what we do. We can make a big difference in our own lives and the lives of many Americans by enhancing both our economy and our environment.”

While API’s community standard concentrates on the various production hot spots around the United States, Va Lor and LiUNA focus in many instances on the under-served areas, such as New England, for extending the natural gas market through the expansion of gas infrastructure.

“Our approach is to partner with the industry and communities to help convert whole neighborhoods and towns to natural gas,” said Va Lor, noting it is a win-win situation ultimately for pipeline workers. “We’re bullish on natural gas, and we’re strong advocates for the industry. We also have a lot of boots on the ground to support major pipeline projects.” LiUNA applies the slogan that “pipelines are lifelines” in society.

Va Lor has marshaled her cadre of pipeline workers in Nebraska, Pennsylvania and Massachusetts to support separate projects, such as Keystone, that are the focus of strong environmental and community activist opposition. The projects for the most part are what she describes as “heavily regulated,” and will undergo robust environmental review, she said. Most of them also will relieve severe infrastructure constraints, particularly in New England.

In addition, all of the projects require thousands of miles of pipe and tens of thousands of jobs, providing stimulus for the national economy. This is the ammunition she has to use in the growing public debate surrounding individual and collective mega-energy infrastructure projects.

Polls show that 83% of the public supports more energy infrastructure development in general; 93% agree it creates jobs; and 89% see energy infrastructure as good for security. However, there is still a large NIMBY backlash when it comes to a project in citizens’ own communities.

“The opposition also is more active and more sophisticated than ever before,” Va Lor said. “While they want new energy development, people generally don’t want new projects in their own backyards.”

In 2014, she closely followed developments on Energy Transfer Partners’ (ETP) two-stage “Rover” pipeline project for getting natural gas from the Appalachian region to the upper Midwest and eventually Ontario, Canada. The first stage proposes to access ETP’s Panhandle Eastern Pipe Line and other midwestern pipelines. A second stage would access the Dawn Hub in Ontario via a new pipeline segment.

Since this project was announced, every day there were dozens and dozens of letters asking the Federal Energy Regulatory Commission (FERC) to reroute it, and with other major projects the opponents seemed to come up with thousands, if not millions, of comments in very short periods of time, she said, underscoring the sophistication of the opposition to major energy projects.

In her role as a researcher for LiUNA, Va Lor seeks out widespread comments on major pipeline endeavors to both determine what is on the public’s mind and what the union workforce might bring to the dialogue.

“A lot of the comments were very similar,” she said, noting everyone has opinions on pipeline routes, and everyone wants them to avoid populated areas. Va Lor calls it a “game of cat-and-mouse” in which the opponents often only want to re-route projects continuously.

Ultimately, she has concluded that the pipeline projects have become a proxy for climate change with opponents alleging they threaten to wreak havoc on serious efforts to address the threats of global warming.

Va Lor has studied a series of ongoing pipeline projects – Williams and partners’ Constitution, Kinder Morgan’s Northeast Energy Direct, Spectra Energy’s Algonquin Incremental Market (AIM), and Enbridge’s Sandpiper projects, as well as Keystone – attempting to dissect similarities and differences. Among the similarities are the prospects of heavy regulation, major financing requirements, a chance to eliminate production/distribution bottlenecks, and the possibility of employing thousands of construction workers.

“In New England the opposition is asking very detailed, highly technical questions,” Va Lor said. “The Keystone pipeline has really energized folks who are concerned about the environment. We also know that everyone these days is concerned about safety.”

Va Lor said what all this has taught LiUNA is that when its members go to public hearings, they have to talk about the environment and safety. “We can’t just talk about jobs.”

She continues to sift through the comments and protests filed on all the current major natural gas pipeline projects in the United States. One of the nuggets she finds is the word “explosion” has popped up nearly 1,000 times, and notes that this is a serious concern for everyone.

In mid-September, supporters of Keystone XL held a six-year anniversary party for the Keystone proposal going public. The leading opposition groups – BOLD Nebraska, Oil Change International, Energy Action Coalition and 350.org – mocked them by noting that the supporters were “whining about their dangerous, polluting project not being approved.”

Among the opposition groups’ latest statistics, there have been 2.5 million “anti-Keystone” comments submitted to the State Department by the end of last summer. The groups also claim more than 2,000 people have been arrested thus far publicly protesting the project, while 115 different landowners in the Midwest have been allegedly “bullied by TransCanada,” but nevertheless have refused to give up their land to the proposed oil pipeline project.

Va Lor said there is similar staunch opposition to natural gas infrastructure.

“We know that natural gas is a much-needed fuel, but the debate is no longer about energy, today it is all about fracking,” she told her Chicago audience.

LiUNA attempts to counter this debate with the strength of its members who live and work in the communities, she said. Countering the fear and misinformation campaigns does not require arcane arguments, the union researcher contended.

“This is not rocket science, it’s pretty basic middle-class messages based on being in the community,” Va Lor said matter-of-factly.

She said it is a matter of telling stories persuasively that resonate with average citizens. Like the small town of 3,900 in New York state with a locally based company that has manufactured widgets in the area for 90 years, employing 35,000 different people over the nine-decade time span. It turns out that the advent of natural gas service in the area for the first time through a new pipeline from the Marcellus Shale play will help this local small manufacturing business stay alive.

“At LiUNA part of what we do is help tell those stories,” Va Lor said. “If only one side of the story is heard, that’s the story people will believe. We need to be able to tell more stories.”

Author:
Richard Nemec is a Los Angeles-based West Coast correspondent for P&GJ and can be reached at: rnemec@ca.rr.com.