Tue, Nov 30, 2010 page7

• ANALYSIS: Oil, potash fueling boom in Canada’s hinterland

  • AP, SASKATOON, SASKATCHEWAN
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  Saskatchewan takes its stereotypes in stride. People here joke that their province is so flat you can watch your dog run away. For days.

  To most Canadians, it’s just a Texas-sized near-rectangle of fly-over country, home to flinty farmers who distrust big business, electing the first socialist government in North America in 1944 and keeping it in power for the better part of 66 years.

  “The only stories you ever saw out of Saskatchewan were weather, a drought, a flood or some farmer with a piece of straw in his teeth who found a three-headed turtle,” Pamela Wallen says, a former journalist.

  In short, went the stereotype, this was a great place to be from, but not to be in.

  But hold on; what are Porsches doing on those ruler-straight roads? How come the housing market is booming? What has this land of hockey, howling winds and deep-freeze winters got that is attracting immigrants from the Philippines, China, Ukraine, Iraq, India and South Korea?

  The short answer is an economy driven by a staggering abundance of natural riches — oil, potash, wheat, uranium — and a provincial government eager to create a -business-friendly, immigrant--welcoming climate to boost its finances and million-strong population.

  Saskatchewan is probably best known for producing singer Joni Mitchell, hockey great Gordie Howe and the late Tommy Douglas, the first socialist premier. Douglas also founded healthcare-for-all in Canada, was grandfather of actor Kiefer Sutherland and in 2004 was chosen as “The Greatest Canadian” in a contest run by the Canadian Broadcasting Corp.

  These days, however, Saskatchewan is in the news for a more prosaic reason: Potash, the mineral that lies under its prairies and -fertilizes farms the world over. Saskatchewanian Premier Brad Wall believes it was a thwarted foreign takeover of Saskatchewan’s biggest potash mines that awakened Canadians to the wealth in their midst.

  “A lot of Canadians were probably shocked,” he said. “Canadians discovered that we’ve got 53 percent of the known reserves of something. Saudi Arabia doesn’t have that percentage of the world’s oil. There isn’t a resource like it in the world in terms of one country having such a dominant position.”

  And not just potash. Saskatchewan has a quarter of the world’s reserves of uranium and Canada’s second-biggest oil reserves.

  “We sell more oil to the US than Kuwait,” Wall said.

  To fend off a US$38.6 billion hostile bid for Potash Corp by BHP Billiton, an Anglo-Australian giant, Wall’s government mounted a vigorous PR campaign to promote potash as a strategic industry and Saskatchewan as a business magnet in its own right.

  This month the federal government agreed the sale was not in the national interest and blocked it.

  The publicity over this clash of corporate titans drew headlines and the result, Wall says, is that: “The world is kind of tuned into what Saskatchewan is saying. They are kind of interested in this place that’s hard to spell and pronounce.”

  (Pronounced Sass-CATCH-who won, the Cree name means “swift-flowing river.”)

  Wall, 45, is a peppy, trendily tailored Canadian, a football lover who keeps a collection of helmets in his office. He exemplifies the changing of the guard in Saskatchewan since his conservative government took office three years ago, as well as a psychological change.

  Many Saskatchewanians carry a folk memory of the 1930s, when the province was devastated by the Depression, Ralph Goodale says, who represents a Saskatchewan district in the national parliament for the opposition Liberals.

  “For the longest while agriculture was the only game in town,” Goodale said.

  However, as the economy has blossomed, “I think that really has put a bounce in the step of Saskatchewan people. They are less pessimistic and more optimistic now than I’ve ever seen them,” he said.

  Canada has largely weathered the global recession, nowhere more strikingly than in Saskatchewan. It has Canada’s lowest jobless rate. It’s famously loyal to the British royal family — a statue of Queen Elizabeth II on a horse stands outside the provincial legislature in Regina, Saskatchewan’s capital — yet is happily diversifying its population.

  Wallen, the former journalist, who is now a conservative senator, says many Filipinos have moved to her hometown of Wadena, Saskatchewan, population 1,500.

  “They land from the Philippines into winters where it’s 40 below,” Wallen said. “But they are excited by the adventure. Somebody meets them at the airport with a parka. It’s kind of the spirit of these places.”

  Young people used to flee Saskatchewan in droves, but now the population is growing for the first time in decades, to an all-time high of 1,045,622 people this year, 16,498 more than last year.

  House prices have doubled in the last three years. Don Atchison, mayor of Saskatoon, the biggest city, says Saskatchewanians used to drive the oldest cars and trucks in North America, Mexico included.

  Now he sees new cars everywhere.

  Vaughn Wyant, who opened a Porsche dealership this summer, says mind sets have changed.

  “It was almost a crime around here to be too successful and it’s not that way any more. It’s a right-leaning and business-focused economy,” he said.

  Wallen likens the old Saskatchewan to East Germany before the fall of the Iron Curtain.

  Dwain Lingenfelter, a Saskatchewan leftist, doesn’t think it’s all roses.

  Lingenfelter, who leads the leftist New Democratic party in the province, says the economy was doing quite well when it was in power.

  “Oil production has actually gone down since Brad Wall was elected. Natural gas production is down by 12 percent, pork production is down by 50 percent, beef production is down,” he said. “The economy was booming with record numbers of oil wells drilled and gas wells in 2007, not in 2010.”

  He said the gap between rich and poor was widening and housing was becoming unaffordable for the less affluent.

  “Some people are seeing rental rates go up by 20 or 30 percent a year and their wages are frozen and these things just don’t add up for working people,” he said.

  However, he acknowledges the upside.

  “It’s exciting times in Saskatchewan,” he said. “I don’t want to make it sound like there’s huge problems, because there isn’t.”
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