fly-in fly-out course assignment - tim nabholz

2012

Sustainable Urban

Development –

Course Assignment

BY604E

Tutor:

Peter Parker

Written By:

Timothy Nabholz

[Has Fly-In Fly-Out Operations in Northern Alberta Been Sustainably

Planned for by the Regional Municipality of Wood Buffalo?] Keywords: Fly-in Fly-Out (FIFO), Long-Distance Commuting (LDC), Sustainability,

Sustainable Urban Development, Sustainable Planning, Fort McMurray, Regional Municipality

of Wood Buffalo, Boomtown, Remote Work, Transient Workers

Source: RMOWB MDP


Planned for by the Regional Municipality of Wood Buffalo?] January 2012

2 Course Assignment | Timothy Nabholz

Abstract

The Regional Municipality of Wood Buffalo is experiencing extreme growth. In order to deal

with this growth in a sustainable manner the municipality has recently completed two

monumental planning initiatives, a Municipal Development and Municipal Strategic Plan for the

region. The plans identify respectively, a 5 year and 20 year outlook for the region. This paper

delves into whether the plans appropriately deal with the growing trend towards Fly-in Fly-out

initiatives in the municipality.




The Regional Municipality of Wood Buffalo

The Regional Municipality of Wood Buffalo (RMOWB), the second largest municipality in

Canada. Fort McMurray is the primary urban centre in the municipality. Between 2000 and

2010, the city’s population more than doubled. The current population is in excess of 75,000

people, and the municipality is planning for it to double again in the coming 10 years (RMOWB

MDP, 2011). The community has seen a number of changes to their city’s landscape in the past

decade. The largest change, though perhaps subtle to residents, is the oil industry’s trend towards

using work camp operations versus relying solely on the community of Fort McMurray.

The extreme growth in the region has created a number of infrastructure strains for the city. In

the mid 2000’s, in order to alleviate some of this tension, the city made a “gentleman’s

agreement” with many oil sands industry heads to have these “work camps” set up. This was

supposed to provide some room for the city to play catch-up (Germain, 2012). Due to the remote

nature of many of these worksites, it had become increasingly difficult for the oil industry to

garner sufficient staffing requirements from local communities. As a result, a win-win situation

was created whereby the industry could draw from larger labour market pools and the

municipality could address infrastructure issues. Not only has the city itself doubled in size since

2000, but an additional 20,000+ people are also now currently living in work camps in the region

(Germain, 2012).

Fly-In/ Fly-out (FIFO) is one of many names given to the practice that the industry uses in order

to meet staffing demands at their remote worksites. This type of operation is usually comprised

of workers following a set roster / rotation whereby they spend a certain period of time at the

work site, and then are flown back to their home hub location where they enjoy a certain number

of days off. The companies provide air and ground transportation for workers from their hub

location to their work site, and provide accommodation once at site. This type of arrangement

was popularized in Australia where they often use another common industry term, Long-

Distance-Commuting (LDC) (Houghton 1993).

As a born and raised Fort McMurrayite, I have a strong emotional interest in the changing nature

of the city. Although I moved away from the city in 2002, I have worked at two of the major oil

companies in the region since. Having spent nearly six months living in a work camp, I am able

to approach this topic with a first-hand perspective. As I have also worked in the corporate office

of another oil company in the travel and accommodations department, I understood there were

significant gaps in the planning process. I try to convey fact-based opinion on the subject, while

also leveraging some of my personal background to attack the subject matter.

Problem

Fort McMurray has developed an international reputation as a transient boomtown. Sheldon

Germain, a member of the RMOWB, addresses the problem facing his community quite well on

the municipality’s website (RMOWB website, 2011) in the following statement:

"In many communities, people grow-up in that town or city and have a distinct

attachment to it. In Fort McMurray, many people move to the community from

other parts of the province, country, and world, and therefore consider those




places as home. The unique challenge we have is to have the people that move

here become more attached to the community and be proud to call Fort McMurray

home."

A growing number of transitory workers are coming to the area as the municipality attempts to

plan for a lasting community. The FIFO operations significantly impact the ability for the

municipality to create a sustainable region.

In order to deal with the planned growth in the region, the city has developed a Municipal

Strategic Plan aimed at addressing the needs of the region until 2016, and a Municipal

Development Plan with a 20 year outlook. The Government of Alberta also has plans for the

region, and has completed a Comprehensive Regional Infrastructure Sustainability Plan (CRISP)

for the Athabasca Oil Sands Area. These documents are all meant to help the municipality deal

with the planned growth of oil sands development in the region.

The industry is also trying hard to meet their own needs of finding skilled workers to work on

their jobsites. Suncor Energy, the largest player in the oil sands region, is nearing the completion

on their own Long-Term Lodge Supply Strategy. The strategy calls for an additional 5000+

rooms in the region in the next 3 years and looks at securing lodges for all their projects for the

next 20 years, which could be more than 20,000 rooms (Stangl, 2012).

Each stakeholder has a different set of goals, and for the most part, is working independently of

each other. As a consequence no one seems to adequately address the potential impacts that the

growing Fly-in Fly-out population will have on the city of Fort McMurray.

Aim and Research Question

The emphasis of this paper is to provide insight into the current and potential impacts of a

growing FIFO population in the RMOWB on the City of Fort McMurray. Although this paper

recognizes that there are outstanding issues around sustainability in the region, particularly

around whether oil sands development itself is a sustainable practice (Heger 2010), this paper

focuses solely on the implications that FIFO operations have on the city of Fort McMurray. It

hopes to answer the question of how do FIFO operations in Northern Alberta affect the

sustainability of the nearby urban community of Fort McMurray, and is the planning processes

being utilized sufficient? Its motivation is to provide insight into how the oil sands industry has

historically used these types of work set-ups, why they have grown in popularity in recent years

and assess the potential effects towards the long-term viability of Fort McMurray. Its major

focus is to critique the planning process.

Research Methods

As primary research, two relatively unstructured phone interviews were completed. The

interviews attempted to gain insight into what the two largest stakeholders thought of the

planning process. Conversations were had with a member of the RMOWB municipal council, as

well as the Director of Lodging at Suncor Energy Inc.




Councilor Sheldon Germain is a lifelong Fort McMurrayite with the ability to impact changes at

a municipal level. In 1998, at 26, Sheldon became the youngest elected councilor ever in the

RMOWB. He is currently serving his fifth term on the municipal council and has seen many

changes to Fort McMurray in this time. When it comes to assessing the impacts on the city

caused by these types of operations, there are few who could provide better insight.

Troy Stangl, the Director of Lodging at Suncor Energy is responsible for all of Suncor’s lodging

requirements, which account for an average of more than 10,000 rooms per night. Although Mr.

Stangl had been with the company since 1991, he only recently moved to Alberta and began in

his new role. As a new eye in Alberta, Troy has a unique perspective on how the industry works.

He is currently at the tail end of completing Suncor’s Long-Term Lodge Supply Strategy and

was able to provide interesting vision into the industry’s take on FIFO.

The interviews were conducted in order to gain a working perspective around the effects that this

type of work has on the city. Firm results were not required for this analysis and as such a

relatively unstructured technique was used in order to allow the interviewees to provide whatever

insight they felt was relevant. As both interviewees were located in Canada, phone interviews

were completed.

Prior to the conversations, both interviewees received an email explaining the scope of the study

and had been asked to think about what they thought was relevant. Although the phone

conversations were not recorded, interview minutes were completed. All quotations from the

interviews are expressed views and are not necessarily the precise words used by the

interviewees during our conversations. As in all conversations, the interpretation of the message

being passed on from the interviewees is subjective, however I try to express the opinions as the

interviewee had intended them.

Alan Bryman had suggested that the unstructured format was likely to garner more candid

responses from the interviewees (Bryman, 2008). As I was hoping to structure my research at the

time of the interviews, I felt that by allowing the interviewees to speak freely I was able gain the

most insight into what they valued on the subject. By providing upfront information on what the

overall study subject was, the interviewees were able to join the conversation with some idea of

what I was looking for, but were able to steer the conversation as they wished.

An email conversation was also had with the office of the Mayor of the RMOWB. Again, it was

used in order to gain the insight of the key stakeholder. Unfortunately the mayor had been too

busy over the holiday season to respond herself and a member of her staff responded instead. As

such, the comments were considered, however not treated as true opinions of the mayor herself

(Appendix A).

Additional research was also completed through secondary document research of online journal

articles, internet websites, government documents and course textbooks. The majority of analysis

pertained to the government documents. These documents have all been published and are

accessible to members of the public. The journal articles used for analysis have been peer-

reviewed published articles and are considered to be knowledge on the topics they pertain to.




Sustainability in the Regional Municipality of Wood Buffalo

In order to determine how FIFO activities affect the sustainability of the city of Fort McMurray it

was important to find a relevant definition of sustainability. Rather than re-create another

definition of the term, this paper borrows the definition put forth by the RMOWB. They identify

sustainability as putting “value (on) living in a region that is safe, healthy, inclusive of all

residents and provides local opportunities. We have a strong economy, a healthy environment, a

rich culture, and an abundance of social capital.” Their goal is to “make decisions that reflect an

understanding of the interdependence of these systems and consider residents’ long-term needs

to ensure the resources of today are sustainable into the future.” (RMOWB MDP, 2011)

The chosen definition does a great job at identifying a need to consider interdependencies within

the community whilst making decions. Merritt Polk, in her presentation to the Sustainable Urban

Management class in Malmo identified Sustainable Urban Planning as an extremely important

tool in order to properly address the needs of a region. Her view is that stakeholder engagement

is key to proper planning (Polk, 2011). In the context of the RMOWB, that means that all levels

of government, industry and the community are involved in developing a plan for a sustainable

future.

Industry Background

Locals had seen evidence of oil in the sands along the Athabasca River for over 100 years, but

the first exploration of the Athabasca oil sands didn’t begin until the 1960’s when Great

Canadian Oil Sands, which is now Suncor, began mining the first barrels of oil. Although at the

time Great Canadian was unaware, the Athabasca Oil Sands are the second largest oil reserve in

the world, with an estimated 170 billion of barrels of oil (Government of Alberta, 2011).

Today the industry is home to some of the world’s largest companies. International giants such

as the Royal Dutch Shell, British-based BP, the French-based Total and American-based giants

Chevron and Exxon are all currently working on projects (Seeking Alpha, 2012), while Petro-

China has recently approved projects moving forward (Globe and Mail, 2012).

It has been suggested that the industry has only recently become profitable with the spike in the

price of crude oil; however these practices have been profitable for decades. According to the

Canada Oil Sands Trust, as of 2007, the industry had held there operating cost per barrel under

$30/barrel for mining initiatives (Canadian Oil Sands Trust 2007). With oil prices hovering

around $100/barrel however, the industry has been able to invest billions of dollars into new

projects aimed at increasing their overall barrel per day (bpd) production.




From 1999-2009, the industry as a whole more than doubled their total bpd production from

around 700,000 bpd to over

1.5 million bpd. According

to the Oil Sands

Developers Group

(OSDG), this number is

expected to reach more

than 4.5 million bpd by

2017.

When looking at only the

10 largest projects currently

under construction; $82.5

billion is currently tied up

(Appendix B). The OSDG

also claims that “across

Canada, more than 456,000

jobs are directly or

indirectly linked to the construction and operation of oil sands facilities.” It goes on to state that

“(o)il sands investment will generate $1.7 trillion in economic activity across Canada over the

next 25 years… (and) will generate at least $483.5 billion in royalty and tax revenues for

Canada’s federal and provincial governments.” (OSDG, 2012) The reality for Canada is that the

oil sands have historically had a significant role, however moving forward their role will only

grow.

Fort McMurray as a Remote-Urban Boomtown

Fort McMurray is located approximated 435 north-east of Alberta’s capital city, Edmonton. It

“began as a small trading post in the 1780’s and eventually became home to the North West

Company, one of Canada’s first trading companies,” (Tracey, 2005) however today, “Fort

McMurray draws attention from around the world as the residential and commercial focal point

of Canada’s oil sands industry.” (RMOWB MSP, 2011) The city is not defined as a single-

industry town, however almost everything that happens in the city revolves around the oil sands.

According to Fort McMurray city council member Sheldon Germain, more than 90% of the

municipality’s revenue comes from the Oil Sands (Germain, 2012).

Statistics Canada defines an urban area as “a population of at least 1,000 and no fewer than 400

persons per square kilometer.” (Statistics Canada 2007) At over 75,000 residents, Fort

McMurray is very much urban (RMOWB MSP, 2011). However, considering that the next city

of greater than 20,000 people, Edmonton, is more than a four and a half drive away, the

remoteness plays a huge role in how the city is defined.

Fig 1




The cost of housing in Fort McMurray, according to Coldwell Banker Real Estate’s Report in

2011, is the 24th

most expensive in the world. This puts Fort McMurray’s housing costs just

behind Dublin, Ireland and just ahead of that of the District of Columbia in the USA (Money

Sense 2011). The majority of the 71 cities listed on this survey were either major international

centres or extreme concentrations of wealthy people in beautiful coastal areas. Fort McMurray is

neither. Located in the middle of a boreal forest, Fort McMurray does have many beautiful

features, but being so remotely located has affected the ability of the city to draw in new

residents. Although the cost of housing is extremely high, Fort McMurray residents earn an

average salary of nearly

double that of the rest of

Canada (RMOWB MDP,

2011). At an average

household income of

$177,634, Fort McMurrayites

in general, are doing very well

for themselves (RMOWB

MDP, 2011).

According to Germain, the

primary reason that the cost of

housing is so great in the city

is because the Alberta

Government owns the majority

of the land in the region and has not released enough land for the city to meet their residential

needs (Germain, 2012). The city currently has a 3,500 home shortage and is expecting to require

an additional 34,000 homes by 2030 (RMOWB MDP, 2011).

Although Wikipedia should not be used as a pure source for knowledge-based information, it is

great place to gain understanding of perceptions on certain topics. As of January 10, 2012

Wikipedia defined a boomtown as “a community that experiences sudden and rapid population

and economic growth. The growth is normally attributed to the nearby discovery of a precious

resource such as gold, silver, or oil.” In the same paragraph, it introduces Fort McMurray as the

modern day example of such a place (Wikipedia, 2011). A quick search of Fort McMurray on

Google also reveals multiple respected international news sites from CNN, NPR and the BBC all

referencing the city as a “boomtown”, though I suppose naming the local casino the Boomtown

Casino doesn’t help the reputation (CNN, 2011, NPR, 2006, BBC, 2008).

Issues Affecting Fort McMurray

The Fort McMurray discussed in the media is often quite different than that experienced by

locals, however those critical of the city often make their opinions well heard. The

Oilsandstruth.org website claims that “(m)any of the thousands of workers who live in barrack-

like accommodation at nearby mines and construction sites come to town at weekends, to drink a

beer or ten, brawl, and buy sex and drugs.” (Oilsandstruth.org, 2007) Although many of the

attitudes towards the problems that the city is dealing with are unsubstantiated opinions from

outsiders, the city does have many issues.

Fig 2 Source: MDP




The built environment, in particular, has been significantly affected by the regional growth. The

municipality has attempted to address some of the infrastructure issues in the area through the

introduction of new overpasses, a new bridge and waste treatment plant. According to the Globe

and Mail, before the bridge was opened in November 2011, more than “55,000 cars crossed the

Athabasca Bridge along Highway 63 every day” in 2010, with the city often experiencing “Los

Angeles-like traffic jams.” (Globe and Mail, 2011) Although the new bridge has helped, until the

overpasses are completed in 2012, the city will still experience terrible traffic jams

(albertacanada.com, 2011). The city had also experienced lagging standards in wastewater

treatment until the new LEED silver certified treatment plant was opened in 2010. The treatment

plant was slated for a population of 130,000, but with the planned growth, does have the ability

to expand (Fort McMurray Today, 2010).

There are two ways into Fort McMurray, by air or by ground. The only highway into the city,

Highway 63, is a single lane highway that runs for nearly 400 kilometres from Boyle in the south

to Fort Mackay, 50 km north of Fort McMurray. The road “has some of the highest tonnage per

kilometer of highway in Canada, among the largest and heaviest loads, and is among the most

dangerous.” (Storey 2010) It has been coined by locals as “death highway” for the sheer number

of people who have died on the road. In 2007 alone, 22 people were killed on the highway in

automobile accidents (Storey 2010). Although the province had begun twinning the highway in

2007, as of March 2010 less than 10% of the road had been expected to be completed by the fall

of 2011 (Government of Alberta 2010).

If you want to travel to or from Fort McMurray by air, you will have to go through the busiest

regional airport in Canada. The Fort McMurray Regional Airport has increased traffic from

approximately 223,000 in 2004 to 704,000 in 2009 and it expects to welcome over 1 million

passengers/year in the near furture (Fort McMurray Airport 2010). In 2009, the province agreed

to fund an expansion to the existing airport with a new 14,000 m² terminal. However, until the

project is completed in 2014, the guests travelling through the airport will be quite squeezed as

the peak-hour maximum at the airport is 200 people and they are averaging closer to 400 people

per hour (Fort McMurray Airport 2010). As a result, a growing number of oil companies

including Canadian Natural Resources, Shell Albian, Suncor and Cenovus, among others, have

all created their own airstrips (Ourairports.com, 2012).

Although the Municipality has struggled to deal with growth in an adequate manner, industry has

found ways to make it work. By having workers Fly-in and Fly-out of the region, industry is able

to bypass these major problems that the city is dealing with. However, as Councilor Germain had

noted in our interview, these workers still have a strong effect on the city. According to the

Report on Mobile Workers in the Wood Buffalo Region of Alberta, although the majority of

these transient workers are staying in work camps, “the average (transient) worker visits Fort

McMurray once every 1.4 weeks.” These tourists, which are currentlybeing unaccounted for, put

an unbelievable amount of strain on the city’s infrastructure. According to the same report, “the

Northern Lights Health Region indicates that out-of-region persons make up 32% of all visits to

the emergency room of the Northern Lights Health Centre.”(Athabasca Regional Issues Working

Group, 2007)




If the region plans to grow sustainably into the future they must consider the implications of

these types of workers on the major urban centre in the region.

Fly-In Fly-Out Historically

Fly-in Fly-out operations began in the 1940s in the Gulf of Mexico’s offshore drilling sector,

when the distance to the drill sites made it no longer feasible for daily commuting (The Chamber

of Minerals & Energy - Western Australia 2005).

Traditionally, oil sands companies used FIFO operations for their short term project and

turnaround workers in the 1990s. More recently however, the amount of full-time camp workers

has skyrocketed. FIFO activities have largely replaced the requirement for workers to

permanently move to the area and have made the industry far less dependent on Fort McMurray.

Many of the large companies in the area are currently investing billions of dollars into what are

considered fairly short term housing complexes. According to the CRISP report, the lifecycle of

these camps is considered anywhere between 10-15 years before requiring substantial

renovations (Government of Alberta, 2011).

Although the term “work camp” may insight images of third-rate accommodations, the oil sands

industry has worked extremely hard to rebrand them as much more. The new “lodges”, as the

industry is trying to coin them, are more similar to a cruise ship than a traditional work camp; as

they include movie theatres, gymnasiums, 24-hour food services, billiards rooms, on-site nurses,

massage therapists, and Canada’s national treasure, Tim Hortons coffee chains (CTV news,

2008). The goal of these lodges is to create a comforting “home away from home” for the

workers.

Reason for Increase in Fly-in/Fly-out Lodges

The increase in FIFO operations is not limited to Canada, and as the Australian case paper

written by Daniel Htwe points out, there are a number of factors leading to the increase globally.

In his paper Htwe identifies three factors that also play a role in the oil sands: 1. The isolation of

the operation/ mine, 2. Short-term life / variability of work, and 3. Search for qualified work.

Much like the sites in Australia, the oil sands development is becoming increasingly remote. The

Suncor and Syncrude mine sites that have been in operation for over 20 years are still within a 45

minute drive from the city of Fort McMurray, however the majority of new developments are

located much further away from the city, making transportation a huge issue. Much like how the

drilling in the Mexican Gulf pushed further into the ocean and made daily commuting

impractical, the oil sands developments are pushing further into the forest making commuting

times with current infrastructure completely unrealistic.

The variability of work in the oil sands also makes hiring only full-time employees unreasonable.

Much of the current work on oil sands sites is project or turnaround related, and this type of work

experiences significant peaks and valleys when it comes to the number of employees required on

site at a time. For instance, the type of work required on a project is constantly changing and the

number of employees required at each site can vary by in excess of 1000 rooms from month to




month. Historically, oil sands developers had to deal with major problems to their upgraders that

would bring their whole production to a halt and cost substantial amounts of money in lost

revenue. In response, the oil sands companies have started proactively doing “turnarounds”.

These are “the periodic planned shutdown of a facility to perform maintenance work and install

new capital projects.” (AP Canada, 2011) These are typically short and intensive work

completed in the summer months. In 2011, Suncor had the largest ever turnaround which took

nearly two months to complete, peaked at over 10,000 employees and cost over $1 billion.

It is also important to note that unlike in traditional accommodation, where you may have points

in a year where there may be “no vacancy” for a certain period time; these accommodations are

required by the business. Often companies have an excess supply of rooms of greater than 10%

over their peak numbers, in case of emergencies. For the companies, it is completely

unacceptable to not have rooms available for workers and companies often pay significantly to

ensure access to rooms.

The labour market shortages experienced in the RMOWB are unparalleled throughout the world.

According to cbc.ca, a recent report suggests that the oil sands industry may require an additional

130,000 jobs in the next 10 years (Cbc.ca, 2011). As a response, the oil sands industry has

pushed their recruiting efforts beyond the RMOWB and Alberta. According to the report on

mobile workers report, 48% of workers living in work camps come from outside of Alberta

(Athabasca Regional Issues Working Group, 2007). The industry has even begun looking

abroad to meet their labour needs. In an attempt to help industry, the provincial government had

even initiated plans to create a program that would more easily certify immigrant workers skills

and credentials (Fort McMurray Today, 2008).

Industry Trend in Fly-In Fly-out

Suncor Energy Inc. is nearing completion on their Long-Term Lodge Supply Strategy. Although

the plan was meant to address all new camps to be built by Suncor, more than 3,000 camp rooms

had already been approved to be completed in 2012 and the strategy could only affect the inner

workings of the lodge.

Within the strategy, the company has identified their FIFO program as a marketing tool that they

will use to attract and retain qualified employees. As part of this initiative, they have recognized

that no employee should have to travel further than 30 minutes to their worksite. As such, they

have to develop lodges nearby to their worksites and are unable to house employees in one

central location and deal with peaks at one place. This means that they also are required to deal

with peaks at individual work sites. So rather than allowing an excess supply of a few hundreds

total rooms, they are required to have that excess at all of their sites (Stangl, 2012).

Suncor currently operates 3 primary sites. Suncor’s Base Plant, is the oldest site in the area and is

also the nearest to Fort McMurray, at just over 30kms from the city. This site had traditionally

drawn 100% from daily-commuters, however in the last few years, has drawn FIFO employees

for their projects and turnarounds. In 2011, the capacity peaked at roughly 10,000 rooms / night.

Firebag, which is 75kms and approximately an hour and a half drive away from Fort McMurray,

uses 100% FIFO for operations, projects and turnarounds. In 2011, the capacity peaked at




approximately 8,000 rooms. MacKay River, which is approximately 50 kms and approximately

an hour drive away from Fort McMurray, is about 50-50 daily-commuters and FIFO workers. In

2011, its capacity peaked at a much smaller 500 rooms (Stangl, 2012).

When it comes to growth however, Suncor is planning on expanding their MacKay River site to

a point where they will require a peak of 2000 rooms. They are also completing a new site at Fort

Hills that will require peak room requirements of roughly 5000 workers. They are also building

the new Voyageur upgrader that will also require peak room requirements of around 5000 rooms.

By 2015, Suncor itself will be looking at a peak room requirement around 30,000 rooms, or more

than what was available to the whole region in 2009. Suncor has also started moving most non-

critical workforce jobs away from Fort McMurray as the costs of employees is far greater in Fort

McMurray than the rest of the country. (Stangl, 2012).

When critical workers do move to Fort McMurray Suncor has also identified the need to provide

transitional housing options to workers who will be moving to the area permanently. Suncor

owns or leases more than 100 condos in the city and uses them as an interim home for many new

employees to the region. This type of housing allows workers, their spouses and children to stay

in the residences at no cost for up to 3 months while looking for long-term accommodations.

This type of accommodation allows the employees to move to the area much quicker and stay in

high-quality lodging while looking for stable housing (Stangl, 2012).

Suncor is only one company in the region; however the scenario is quite similar with most other

oil sands developers as well (Map of current work camps in region available in Appendix C).

Unfortunately, industry is currently working in unison and each company is following a similar

plan.

Evaluation of Government Planning

The Municipal Development Plan (MDP) and the Municipal Strategic Plan (MSP) are the two

most recent plans compiled by the municipality to address the future of the region. Completed in

October 2011, the plans are “a guide for both short and long-term decision making at the

Regional Municipality of Wood Buffalo. The time horizon of the Municipal Development Plan is

20 years, compared to five years for the Strategic Plan.” (RMOWB MSP, 2011) Although “(t)he

MDP does not directly identify individual capital projects or infrastructure spending,” it does

identify a number of goals for the city.

The MDP outlines a familiar set of objectives. The stated goals are as follows: 1. Responsible

Development, 2. Environmental Stewardship, 3. Economic Resilience, 4. Home and Belonging,

5. Vibrant Culture, 6. Working Together (RMOWB MDP, 2011). Although the municipality

gives their own take on social sustainability by breaking it into to multiple categories, it is quite

easy to identify the goals as trying to follow a sustainability objective.




The plan is meant to address the needs of future generations, as such, it was important to

understand what the municipality had planned to do in response to the rising number of FIFO

operations in the region. Unfortunately, considering the significant affects that FIFO can have on

the community, FIFO work camps are rarely referred to in the long-term growth plans of the

municipality. The small section of the MDP that does discuss work camps proposes that the total

number of work camps will remain stagnant over the next 20 years and at no point addresses the

Fly-in Fly-out nature of these work camps. It suggests that industry will start to congregate into

what it calls “consolidated work camps.” The report suggests that two of these consolidated

work camps will be constructed, with one located to the North of Fort McMurray and one to the

South. The idea is backed up in the CRISP report produced by the Alberta government that

suggests that these settlements will “serve as longer-term communities for operations staff and

their families,” and provide “the services and support they will require.” (Government of

Alberta, 2011) Although the idea of creating these consolidated work camps is a good one, the

government has failed

to adequately include

industry in

discussions.

Much like what

Germain had stated in

his interview, the

Accommodation in the

Regional Municipality

of Wood Buffalo,

Alberta Project

completed in July

2011, assesses the

current population in

camp at greater than

23,000. The report, which was also completed by the municipality, however identifies a

significant issue plaguing the municipality in terms of their planning. It notes that“(m)ultiple and

conflicting data sources regarding project accommodations in the Wood Buffalo region” make

planning initiatives difficult. This report however makes note that there is a current approved

capacity in the RMOWB of greater than 61,000 rooms (RMOWB Accommodations, 2011). This

number represents lodges that have already been approved by government to be completed.

Considering the accommodations report was completed in July 2011 and the municipal plans

were completed in October 2011, the municipality has either consciously or unintentionally

omitted a very relevant trend from their planning process. The municipality may have the best

interest of their community at hand; however, it seems that they have made a huge oversight in

their planning process.

Concerns around Municipal Plans

Fly-in Fly-out operations have created a unique situation for the city of Fort McMurray in terms

of how to deal with population growth. The municipality and industry seem to be headed in

Fig 3




completely opposite directions. While both acknowledge the other as being important to their

personal sustainability, they continue to work independently.

On one hand, the RMOWB is planning for an additional 130,000 people to move to Fort

McMurray in the next 20 years. On the other, the oil sands industry is in the process of

increasing their FIFO work camp population by 30,000 in the next 3-5 years. This growth,

according to Figure 3, is almost exactly the same population growth that the region expects

during that period.

The MDP states that “(w)hile Fort McMurray itself increased by more than 34,000 people

(between 2000-2010), the population living in work camps has (also) grown dramatically from

less than 6,000 to more than 23,000 (in the same period).” (RMOWB MDP, 2011) It seems that

when looking at Figure 3, the regional population increase between 2000 and 2006 occurred

almost completely in the city of Fort McMurray. When you look at the past 5 years however, the

regional population increase occurred almost exclusively within the work camp population. This

trend cannot be ignored.

With such a large population clearly being pushed into work camps, I find it hard to believe that

the city will see the population increase they are planning for. As housing these workers in work

camps is cheaper and less risky for industry, I believe that this trend will continue into the future

with the majority of the increase in population for the region being housed in work camps.

Although the region as whole might increase to 230,000 people, unless intervention occurs, I

believe that a significant portion of that population will be swallowed up by work camps.

If the region expects to move forward sustainably, all parties must work together to tackle this

important issue. In a step in the right direction, a new committee being chaired by Suncor Vice-

President Heather Kennedy was announced on January 5th

, 2012. This committee is comprised of

“municipal, industry and provincial representatives” that will make suggestions on current and

future transportation needs for the region. It plans to “take into account the region's unique

economic and infrastructure needs and the importance of the oil sands to the province's

economy” when making decisions (Future and Commodity Market News, 2012).

The Regional Municipality of Wood Buffalo Moving Forward

The Regional Municipality of Wood Buffalo is experiencing unprecedented growth, and more

than ever, the world is watching. A number of planning initiatives have been undertaken to

address the impact that the growth will have on the region, with a significant portion focused on

the primary urban centre, the city of Fort McMurray. The Municipal Development Plan, in

accordance with the Municipal Strategic Plan has identified a number of set goals on how to deal

with growth sustainably. Unfortunately, the plans have failed to identify a trend towards Fly-in

Fly-out operations that could significantly affect the landscape of the region.

If the city and industry both believe that the best path forward is having a concentration of

population growth in one single area, and that that area is Fort McMurray, they must address

industry’s desire for easy flexible lodging.




The only sustainable way forward for the region, in my opinion, is to set up work camp

communities like the MDP and CRISP reports suggest. Unfortunately for the municipality, a

number of projects have already received sign-off. As such, a number of work camps will be

built in the next 2 years on individual companies worksites, making camp communities less

feasible. In my opinion, industry does have the desire to work together to make these

communities possible. However I also believe that there is some fear that if the industry works

together to meet these needs it will be considered collusion. As such, government, at both the

provincial and municipal levels, needs to lead industry together to make successful planning a

reality.

Despite many lapses in planning, the region still has the opportunity to plan for sustainable

growth. The new committee on infrastructure that includes industry and both provincial and

municipal government participation seems to be a step in the correct direction. Similar to what

Merritt Polk had eluded to in her presentation regarding planning processes in Gothenburg, the

scenario in the RMOWB requires significant collaboration between all major stakeholders in

order to solve the current planning issues. Although this step is one that needed to be made, I

would urge the committee to encourage all major oil companies to take part and to share both

historical data and future lodging development plans.

This initiative should create a platform for consistency of data, which is what the region truly

needs moving forward. Only then can a sustainable plan for the region be implemented.




Appendix A:

Email conversation held with RMOWB Mayor’s office

In your opinion, when and why have Fly-in Fly-out camps grown in popularity in the region? Was the city involved

in this growth?

Lack of housing in the Region and access to the various sites have probably been factors in companies' decision to

go this route. The Municipality has not been involved at all.

How do you think these set-ups affect the city of Fort McMurray? Both Positively and Negatively. They don't affect

the city positively at all. Negative aspects would be that they increase usage of our amenities such as hospitals,

doctors offices, etc. and don't pay taxes to support them. The fly in/fly out employees work in the region and take

their earnings back to wherever they live.

What sorts of issues was the city dealing with prior to the increase in FIFO camps?

Lack of housing and infrastructure to support population increase.

Do you feel that the FIFO camps lesser infrastructural stresses in the region? If so, how? If not, why not? Traffic

impacts would be less but that's about it. The strain on healthcare and other amenities increases.

What sorts of issues is the city dealing with now in regards to the increase in FIFO camps? We're not aware of

increases at this time.

Is there any policy regarding the expansion of camps in the region? Camps are regulated through our Planning and

Development department and must meet criteria in the Land Use Bylaw when they apply for permits.

Does the city know how many camp rooms are in the Municipality? Yes, through our Planning and Development

Department permitting data.

Is the city involved in the planning of these camps? If so, in what capacity? If not, should it be?

I know that a number of camps participated in the Census this past year; does the city see any tax dollars from camp

workers? Not that I'm aware of.

Is there any concern that these FIFO camps may decrease the Oil Industries reliance on Fort McMurray and that the

city may experience a decrease in population, or stagnation, rather than the exponential increase the city is planning

for? No.

Do you feel the Oil Industry would be better off spending their capital on Fort McMurray than on these camps?

Can't answer this.

When it comes to Fly-in Fly-out camps, what would you change? What would be your ideal view on housing these

workers. Ideally, they would bring their families here, buy or rent homes and make this their community instead of

being part of the transient population.




Appendix B: Projects in the Area Under Construction:

Cost in $Millions BPD

ConocoPhillips Canada Surmont Phase II Athabasca In-Situ 2,625 83,000

Regulatory Status Start Up

Under Construction 2015

Husky Energy Sunrise Phases 1-3 Athabasca In-Situ 5,000 200,000


Under Construction

2014-

2020

MEG Energy Corp. Christina Lake Phase 2B Athabasca In-Situ 6,475 35,000



Suncor Energy Inc. Firebag Phase III Athabasca In-Situ 2,244 62,500



Suncor Energy Inc. Firebag Phase IV - VI Athabasca In-Situ 7,000 211,000


Under Construction TBD

Suncor Energy Inc. Voyageur Upgrader Athabasca Mining 11,500 N/A


Suspended/Under

Construction TBD

Canadian Natural Resources

Limited

Horizon Phase 2/3: Tranche

(2-4) Athabasca Mining 14,300 140,000


Under Construction TBD

Imperial Oil Kearl Phase I Athabasca Mining 20,000 110,000



Canadian Natural Resources

Limited Kirby Athabasca In-Situ 1,575 40,000



Suncor Energy Inc. North Steepbank Mine

Expansion Athabasca Mining 11,500 180,000


Suspended/Under Construction

2010

Top 10 Contracts $82,219




Appendix C: Map of Current Camps in RMOWB:

North of Fort McMurray




South of Fort McMurray




Interview Synopsis

Planned Questions for Sheldon and Responses This was a very conversational based interview that allowed me to gain insight into Sheldon’s view of how FIFO affects the city.

Why do you believe FIFO has increased so significantly in the last 10 years?

What benefits does the city see from these sorts of arrangements?

What downfalls does it provide?

It requires a different approach to community development. It allows single workers to live in the community and doesn’t encourage

the families to grow afamily there long term. Transient workers are necessary, but they are choosing to live in camps rather than in

the city.

Land shortages in the city, controlled by the government of alberta, the land is being opened (released) up really slowly. Extreme

lack of land for houses and commercial services. Compare home prices vs the rest of Canada and/or world.

Pressure on water treatment, and other infrastructure

Industry would prefer if the city could provide housing for their workers.

Silos report

CRISP is a bit of a framework that did have some influence from industry but could have used more input. It was more Alberta

government led and didn’t include too much municipal input.

Is there a gentleman’s agreement between the city and the Oil Sands companies to create these camps? Or why have they increased so

significantly?

There is a permitting process involved in the opening of lodges. Yes, there is a construction phase gentlemans agreement, but the

lines are getting muddled slightly as more and more operational people are staying in lodges now.

Would the city prefer these people were permanent residents?

Where within the process does the municipality see tax dollars? What sort of tax money does the city see from the camp workers?

Income? Room/night tax (similar to tourism tax)? Other?

90% revenue comes from the oil sands. They also receive a property tax like a hotel would pay on a room.

Do you feel the Oil Industry would be better off spending their capital on Fort McMurray than on these camps?

When it comes to Fly-in Fly-out camps, what would you change? What would be your ideal view on housing these workers?

Long term sustainability, release more land, develop satellite communities. Workers should travel no more than an hour/ day on.

Invest in rapid rail to increase the quality of life of the workers.

The boomtown image has increased and has taken a hit on the city’s brand. Big Spirit campaign is trying to improve the brand.

Policy is pushing oil companies towards wanting employees to reside in ft mac.

Planned Questions for Troy and Responses This conversation was very informal and most of the conversation was “off the collar”. Troy and I had worked together on the lodge

supply strategy and this gave us some time to catch up and discuss his views on the implications his organization has on Fort McMurray.

We have discussed informally in the past many of the knowledge based details listed in the article. His permission was requested in order

to use him as a reference.

What sort of permitting process is involved in getting camps set up?

There is a development permit that you need to get. ASRD (Alberta Sustainable Resource Development) is trying to manage

environmental impacts and traffic and all that. They are involved and do have a say. ASRD likes the camp on our land.

We are setting up a regional group that tries to ensure that all projects are moving in the same direction and that the city is involved.




Why do you believe FIFO has increased so significantly in the last 10 years?

Safety and cost side. Less time travelling. Not as impactful on the infrastructure. Pushing people to fly in fly out.

If I was in the city’s shoes I would probably want to deal with some short term pains for the long-term gains. Is it the city’s mandate

to deal with the short term? or is it to create a brand and build a bigger better stronger economy and long-term lasting city?

It’s different in Calgary and Ft McMurray. They are truly unique centres in Canada regarding employment opportunities and

expectations of workers.

What benefits does the city see from these sorts of arrangements?

What downfalls does it provide?




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