HURDLES STILL REMAIN FOR LNG CANADA PROJECT

Petronas’ return good news for NDP, but there’s still opposition over pipeline

Just in time for the end of the spring session of the legislature, there was more encouraging news Thursday for Premier John Horgan on a multibillion-dollar liquefied natural gas project for the northwest coast.

“Petronas to join LNG Canada project,” said the press release announcing the Malaysian governmentowned company was joining Shell Canada and partners from China, Korea and Japan in the proposal to build a major LNG terminal in Kitimat.

“You have all of those main players in the natural gas sector, all participating in this joint venture,” said Horgan in hailing the news during a midday media scrum.

“So I think that speaks very well for a positive final investment decision. We’re working closely with the proponents to make sure that we’re doing everything we can to land it.”

No less enthusiastic was Energy Minister Michelle Mungall during debate in the legislature on her ministry budget later in the day.

“I am very encouraged,” said Mungall, who later rattled off project benefits in response to an Opposition question: “The revenue side is $22 billion to B.C. alone over 40 years (plus) 5,000 construction jobs, 800 to 900 permanent high-paying, family supporting jobs.”

Mungall had last month let slip the news to reporter Nelson Bennett of Business in Vancouver that Petronas would be taking a stake in LNG.

The development was particularly gratifying for her and her NDP colleagues because Petronas walked away from its own LNG project here in B.C. just one week after the New Democrats took office last July.

“For them to come back as a major joint-venture partner in LNG Canada, I think, shows not only the investment interests that exist in the world to invest here in Canada, to invest here in British Columbia, but it also shows the strength of this particular project,” the minister told the house on Thursday.

The New Democrats in their opposition days did not make it easy for Petronas to invest in B.C. They opposed both the company’s initial choice of sites for Pacific NorthWest LNG as well as federal environmental approval of the project.

But when the Malaysians abandoned their project last summer, they cited unfavourable investment economics and declining commodity prices, not the New Democrats coming to power.

“We didn’t take that into consideration,” said Anuar Taib, the Petronas-appointed chair of the Pacific North-West LNG board. “We actually look forward to working with Premier Horgan and his government as we develop our vast assets in the North Montney joint-venture area.”

Those assets, making Petronas one of the largest holders of natural gas reserves in Canada, will now underpin the company’s 25 per cent stake in the estimated $40-billion LNG Canada terminal and pipeline project.

Though the New Democrats felt vindicated by the news, major obstacles need to be cleared before the LNG Canada partners reach the threshold for a final investment decision expected later this year. Still pending is an application for remission of import duties on the modular components for the LNG terminal, which will be built offshore and transported to B.C. Approval is expected, but it hasn’t happened yet.

Plus there remain some outstanding issues with First Nations on both the terminal and Coastal GasLink, the 670-kilometre-long pipeline that would transport the natural gas from Dawson Creek to Kitimat.

Mungall cited the progress to date: signed benefit agreements with 19 of the 20 First Nations directly affected by the project.

She’s optimistic about the talks with the one that has yet to sign: the Haisla First Nation based in and around Kitimat.

But under questioning by B.C. Liberal MLA Mike Bernier, she also acknowledged that a holdout group has established a gated encampment directly in the path of the proposed pipeline.

“There are some people within the Wet’suwet’en Nation who have put together this camp and who are opposed. It’s their democratic right to express that opposition in a legal and lawful way.”

The Unist’ot’en healing camp, as Mungall referred to it, is occupied by Indigenous people as well as outsiders who’ve joined the encampment as part of an entrenched anti-pipeline protest.

Mungall and two cabinet colleagues, Indigenous Relations Minister Scott Fraser and Forests and Lands Minister Doug Donaldson, have been reaching out to the hereditary chiefs and band councils in the region in an effort to resolve the standoff.

The Indigenous occupants of the encampment are members of Witset, formerly the Moricetown Band. Mungall disclosed to the legislature that “their council has voted in favour of signing and implementing an impact-benefit agreement for the pipeline.”

But I gather not all council members agreed to the terms with pipeline-builder Trans Canada and the holdouts remain with the encampment. There are concerns that it may yet take an injunction and police intervention to clear the right of way.

Horgan, when asked about that possibility Thursday, declined to speculate.

“I don’t want to look that far into the future,” he told reporters. “The pipeline proponent and the joint venture are working with Indigenous communities right across the corridor and they’ve been very successful — almost unanimous support — and I’ll leave it up to them to do the work that they need to do.”

But time is running out. Judging from material prepared for the cabinet earlier this year, the pipeline company was hoping to start clearing the right of way this spring. vpalmer@postmedia.com

We actually look forward to working with Premier Horgan and his government as we develop our vast assets in the North Montney. ANUAR TAIB, Pacific North West LNG board chair