The provincial government has been strongly pushing for liquefied natural gas (LNG) development in British Columbia. But has B.C. missed the window of opportunity?
If it hasn鈥檛, the B.C. government must at least be a little bit concerned.
Japan鈥檚 ambassador to Canada, Kenjiro Monji, recently said Canada is running out of time if it hopes to supply Japan with LNG (I bet nobody saw that coming).
In a letter to the Canadian Environmental Assessment Agency, Monji said, 鈥渟hould Canada miss a window in demand for LNG, the next opportunity may be 10 or 20 years in the future.鈥�
Monji鈥檚 warning was reason enough for natural gas development minister Rich Coleman to take the first plane to Japan. Japan wants LNG to comprise 27 per cent of its energy mix by 2030. Coleman met with Japanese government officials and major industrial players in an effort to strengthen B.C.鈥檚 working relationship with LNG partners in Tokyo.
Monji鈥檚 warning comes just days after Canada鈥檚 federal environment minister announced yet another three-month delay in the regulatory approval process for Pacific NorthWest LNG. The process has now taken more than 750 days when it was initially supposed to last only a year.
Although I am not as pessimistic, according to the Fraser Institute, B.C.鈥檚 LNG export dreams may already be over. Kenneth Green, Senior Director at the Fraser Institute, and Taylor Jackson, a Policy Analyst in Natural Resource Studies at The Fraser Institute, issued a press release last week saying B.C. may miss out on supplying LNG to Asian and global markets because of delays in the approval process and environmental and Aboriginal opposition.
鈥淎midst a global glut of natural gas, and implacable opposition from environmentalists and some First Nations leaders, British Columbia鈥檚 dream of exporting LNG to world markets is at risk of becoming a pipe dream,鈥� they said.
British Columbia has 20 LNG export proposals, but slow approvals and protests have delayed the B.C. industry as the U.S. and other countries have moved ahead.
Meanwhile, support for LNG development has been dropping.
According to a recent Insights West poll, support for the province鈥檚 LNG push dropped from 50 per cent in August 2013 to 43 per cent in March 2016. During the same period, negative concerns over hydraulic fracturing (fracking) increased.
Of the 20 proposed projects, the provincial government set a goal of having three LNG facilities in operation by 2020. However, a glut of natural gas across North America has brought drilling activity in Northeastern B.C. gas fields to a near-halt. Challenges also include a reduction in global demand, regulatory uncertainty and the need to reduce capital spending because oil prices have plummeted.
Support for LNG in the Lakes District region also seems to be divisive.
While some hereditary chiefs have been against LNG development, Wet鈥檚uwet鈥檈n Chief Karen Ogen has been a strong advocate for LNG. Last year, Chief Ogen started an LNG alliance to gather support from other First Nations groups. In addition, she travelled to China with premier Christy Clark to strengthen relations between B.C. and key partners in China. Meanwhile the Regional District of Bulkley-Nechako (RDBN) announced it was taking a careful approach to LNG development in the region in 2015. I guess we鈥檒l have to wait a little longer to see if B.C.鈥檚 pipeline dreams will finally come true.
