British Columbia’s recently elected Premier Christy Clark has offered support for an LNG export program in her province.
While making a modest initial contribution towards related infrastructure, she set an ambitious goal Sept. 19, targeting three export projects by 2020.
In rolling out the first phase of a job-creation program, Clark said her government wants to “create a new industry with the capacity to export British Columbia’s liquefied natural gas. If we don’t fight for this, we could lose it.”
She pledged a “more aggressive approach” to opening Asian markets for production from the shale gas deposits in northeastern British Columbia.
Clark started by injecting C$15 million towards C$90 million of rail improvements to support an LNG export terminal on Ridley Island near the deepwater port of Prince Rupert and indicated similar help might be available for an LNG terminal at nearby Kitimat.
Kitimat approval supported
She said British Columbia is ready to do what it can to clear the way for final approval of the Kitimat LNG project, operated by Apache with Encana and EOG Resources each holding 30 percent.
The most advanced of the province’s LNG projects, it includes a C$4.5 billion terminal and C$1.2 billion pipeline. Kitimat is currently seeking National Energy Board approval this year of permits to convert 1.4 billion cubic feet per day of gas for export, starting with 700 million cubic feet per day in 2015.
Clark said LNG investment will be further spurred through improved job training, an expanded international marketing program and moves to shorten the British Columbia’s government permitting process.
While endorsing LNG exports to Asia, she made no mention of Enbridge’s proposal to ship 525,000 barrels per day of Alberta oil sands crude through its Northern Gateway project to the Asia-Pacific region.
Clark has hedged on the venture, which faces stiff opposition from First Nations and environmentalists, saying she will wait for completion of an NEB environmental review.
Shell calls for new markets
Her endorsement of LNG exports coincided with a speech to the Canadian Chamber of Commerce by Shell Canada President Lorraine Mitchelmore, who called for Canada to act now in opening energy markets beyond the United States.
She said Canada is alone in failing to pursue the growing Asian market, warning that Asia is currently “setting up its energy supply points … and Canada is not one of them.”
Mitchelmore said the chamber should use the influence of 192,000 businesses represented by its affiliates to call for a more competitive energy framework for Canada, one that incorporates a streamlined regulatory system where the rules of engagement are clear.
“This should be a time of great opportunity for Canada,” she said. “But it’s not — or at least not yet.
“We need to diversify our customer base for energy products and create access to the global growth markets. If we mess this up, Canada will miss an opportunity to sell oil and gas to Asia.”
Canada’s economic future
Mitchelmore said the next step is to act on plans identified at a meeting of federal and provincial energy and mines ministers in July and ensure there is “significant progress” by the time of the ministers’ next conference in 2012.
To those who ask “What’s in it for me?” she said the answer is simple: Canada’s economic future.
“Every Canadian business and every Canadian citizen will be better off if we can sell our oil and gas on the global market. It will generate jobs and create the national wealth we need to continue providing the services and infrastructure that Canadians need to prosper and live well,” Mitchelmore said.
She noted that Canada spends C$190 billion a year on health care and C$80 billion on education, but is currently losing about C$50 million a day, or C$4 billion a year of government revenue, because it does not have access to global energy markets.
—Gary Park
