Federal government approves $11.4-billion LNG project in B.C.

Lelu Island tsimshian banner

Banner on Lelu Island, Tsimshian territory.

Vancouver Sun, September 28, 2016

The federal government has approved an $11.4-billion, liquefied natural-gas mega-project that has been central to Premier Christy Clark’s plans to boost B.C.’s economy — and her hopes of re-election next spring.

Approval was announced late Tuesday after Federal Environment Minister Catherine McKenna, Natural Resources Minister Jim Carr and Fisheries Minister Dominic LeBlanc travelled to Richmond after a cabinet meeting earlier in the day.

“The only way to get resources to market in the 21st-first century is if they can be done in a responsible and sustainable manner,” said McKenna, in announcing the approval. “This decision reflects this objective. With the legally binding conditions we are putting in place and with British Columbia’s commitment to increase its price on carbon in line with the Pan Canadian Framework, I am confident that we will minimize the environmental impacts of the project … ”

Carr said the project will deliver thousands of good, middle-class jobs, “and will help pay for schools and roads, and social programs that enrich people’s lives.”

Clark — also at the news conference — welcomed Tuesday’s announcement as a significant milestone, and the last major requirement for Pacific NorthWest LNG before a final investment decision can be made.

“As the largest capital investment proposal in British Columbia’s history, Pacific NorthWest LNG represents an unprecedented opportunity to create thousands of jobs and new economic prospects for First Nations and communities throughout our province,” said Clark.

Saying the price of natural gas will “go up any day,” Clark said that there is a “really strong appetite” for natural gas in countries like China and Japan that want a cleaner alternative to coal.

“This facility has now completed two extensive environmental reviews, including a federal process lasting over three years. Based on the best, most extensive scientific assessments, approval has been granted from both the federal and provincial governments,” she said.

Despite her support, a coalition of MPs, First Nations leaders and environmentalists said the approval effectively puts an end to Prime Minister Justin Trudeau’s almost year-long honeymoon. The project would become “Canada’s No. 1 greenhouse-gas pollution facility, and threaten our Skeena watershed salmon … ” they said in a statement before the announcement.

pacific-northwest-lng-projectGeorge Hoberg, professor of environmental and natural resource policy for the University of B.C.’s Institute for Global Issues, agreed, saying after the announcement that the approval is “a major step backward for the Trudeau government’s commitment to meet its Paris climate target. Canada has committed to reduce its emissions by 30 per cent by 2030, but this decision increases emissions by nine million tonnes.

“B.C. has blown through its 2020 emission-reduction target, and abandoned all pretence of reducing emissions before 2030.”

However, the B.C. Chamber of Commerce supported the federal cabinet’s decision.

“This will be the largest private-sector development in our country’s history, and today’s decision is a monumental step toward securing not only the future of B.C., but could also mean a much-needed boost for the Canadian economy,” said Val Litwin, the chamber’s president and CEO, in a statement.

LeBlanc added that the decision will bring great economic benefits to middle-class British Columbians and First Nations.

“Department of Fisheries and Oceans (DFO) scientists have conducted thorough reviews of proponent submissions at every step of the environmental assessment process and determined that the potential risks to fish and fish habitat can be mitigated,” LeBlanc said.

Pacific Northwest is part of a broader $36-billion investment by Petronas, Malaysia’s state-owned global energy giant, to construct a pipeline, terminal and natural-gas extraction network in Canada.

The LNG processing plant on Lelu Island, near Prince Rupert, would ship 19 million tonnes a year of liquefied gas to markets in Asia, while pumping more than five million tonnes of carbon dioxide annually into the atmosphere.

The decision represents one component of a complex and politically delicate balancing act by Trudeau, who won the hearts and minds of young Canadians — especially in B.C. — with his promise to show greater respect for the environment than his predecessor, Stephen Harper. But Trudeau also vowed to help Canada’s natural-resource industry to market in order to create more middle-class jobs.

Pacific NorthWest LNG has been one of the leading LNG project proposals for several years, along with the Shell-led $25-billion LNG Canada project in Kitimat and the Chevron-led $12-billion Kitimat LNG project. Shell and Chevron have secured federal and provincial environmental approvals, plus First Nations support at the terminal, and significant support along their pipeline routes.

Pacific Northwest spokesman Spencer Sproule said before Tuesday’s announcement that if the application is approved the next step for the company is to “conduct a total review of the proposed LNG facility before tabling it to the project’s shareholders for a final investment decision.”

In addition to its deal with the Kitselas nation, Pacific Northwest has signed accords with three of the other four First Nations it was required to consult on the LNG terminal: the Metlakatla, Kitsumkalum and Gitxaala nations.

The fifth, the Lax Kw’alaams First Nation, has not taken a firm decision due to divisions within the community. But Mayor John Helin has indicated that his elected council is prepared to support the project if there are assurances the environment will be protected.

A group of First Nations issued a statement Tuesday before the announcement warning of the project’s environmental impact.

“Providing a green light for this project at this time will only lead to protracted litigation, which benefits no one,” said a statement from the Skeena Corridor Nations, which includes a faction of the Lax Kw’alaams, as well as the Gitanyow, Gitxsan, Wet’suwet’en, Lake Babine and Takla Lake nations.

Sierra Club B.C. director Caitlyn Vernon said in a statement that Tuesday was a bad day for people who care about salmon and climate: “Canada’s second-largest salmon run, on the Skeena River, may have had its death warrant signed today, through a reckless disregard for the dangers the Petronas fracked-gas plant poses to hundreds of millions of juvenile salmon in the Skeena estuary.”

But the Greater Vancouver Board of Trade welcomed the announcement, which it noted is subject to 190 conditions, and includes up to $2.5 billion in annual tax revenue and nearly $3 billion in annual contributions to Canada’s GDP.

“The Pacific NorthWest LNG project will energize the Canadian economy,” said the board of trade’s president and CEO, Iain Black.


Posted on September 28, 2016, in Oil & Gas and tagged , , , , , . Bookmark the permalink. 1 Comment.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: