Former P.M. Steven Harper, in 2006, asserted that Canada was an “emerging energy superpower.”
In 2007, he stated, “we can become one of the largest producers of oil, gas, uranium and electrical energy.”
It did not happen. There was an oil price collapse, there were problems getting pipelines built, and the U.S. became a major oil producer and competitor. After the federal Liberals attained power, pipelines faced increased resistance, though the government did rescue the Trans Mountain Expansion.
Christy Clark was victorious in the 2013 B.C. election, touting LNG and accompanying economic benefits – a large prosperity fund and 100,000 new jobs. Again, it didn’t happen. Sponsors of LNG projects faced demand and price issues and a burdensome, multilevel system of government reviews. Several projects in Eastern Canada were abandoned or refused approval. In B.C., 19 proposals dwindled to a handful.
Stage one of Canada LNG in Kitimat now nears completion, while Woodfibre LNG in Squamish projects a 2027 opening. Cedar LNG, also in Kitimat, is led by the Haisla Nation, and has just received federal and provincial approvals. The Nisga’a Nation-led Ksi Lisims LNG project is about to begin a provincial environmental review. The project is proposed on Nisga’a lands north of Prince Rupert. Indigenous involvement was welcomed, and likely helped these projects gain government approval.
New projects will face lukewarm support or even opposition from both levels of government. Premier David Eby recently announced a new “energy action framework”. Eby stated, “Our work on the climate crisis … requires everyone, including the oil-and-gas industry, to do their part to reduce emissions.” That’s fair, except the province requires any project now in the review process to have a plan to be net zero by 2030. Some projects will likely require clean hydro power to meet such standards. However, the province still has not committed to install transmission lines linking to Kitimat.
The second phase of the Canada LNG project already has environmental approval in place. CEO Jason Klein earlier in April said, “It would be difficult to make an investment on this scale [in electrification] without some level of alignment and the support of host governments.” (To be fair, Klein also indicated Canada LNG is still assessing the economics of electrification, according to CBC.)
Eby recently said every project must comply with provincial regulation, “to make sure they’re within our climate budgets”. It may now be impossible for Canada LNG to power the second phase with gas and electrify later, as is their strategy. Klein said they can’t immediately electrify because transmission infrastructure is not there. “If the power was there today it would be a pretty straightforward decision.”
The Trudeau government has discouraged LNG projects. The leaders of Germany, Japan and the EU have sought Canadian LNG. When the President of the European Commission visited, the press asked about the supply of LNG to Europe. Trudeau’s response was disingenuous; he said the private sector decides whether to proceed with LNG projects. However, governments decide the conditions under which projects will be reviewed and approved, if at all. The conditions have largely been prohibitive. And the PM’s feigned deference to the private sector did not stop a Canadian hydrogen deal with Germany.
Canada and B.C. should do everything possible to meet emission targets, but the development of LNG must be aggressively pursued. In so doing, we may miss domestic emissions targets, but we will help reduce total global emissions. The B.C. Liberals believe the projects should proceed. Liberal leader Kevin Falcon said, “it’s important to recognize we are global citizens.” He added that we are obligated to help the world transition from dirty coal-fired power plants to much cleaner LNG. Many analysts agree.
Eric Miller, President of Rideau Potomac Strategy Group, wrote, “Of all the established energy options, natural gas is by far the cleanest, emitting half the carbon into the atmosphere as coal. If just 20 percent of Asia’s coal-fired power plants were converted to natural gas, global emissions would be reduced by more than Canada’s total annual emissions.”
A 2020 Conference Board of Canada study concluded that if all proposed LNG projects at that time proceeded, B.C.’s GDP per year would increase by an average $8 billion per year through to 2064, while Canada’s would increase by an average of $11 billion per year. The LNG industry should be encouraged and engaged, not disparaged. Eby recently lectured, “LNG is, let’s be frank, a fossil fuel that contributes in part to climate change.” Of course, it is. But it is the only fuel that allows for the rapid, large-scale replacement of coal, a much dirtier fuel, the use of which is pervasive across much of Asia.
LNG offers an opportunity to both reduce global greenhouse gas emissions and grow our economies and prosperity in B.C. and in Canada, all within a decade.
The U.S. began to export LNG in 2016, and by 2022 it had become the largest exporter in the world.
Canada, too, with natural gas, LNG, uranium and electrical energy, can become an energy superpower.
Bruce W Uzelman is a political columnist living in the Okanagan.