Mark Collins – B.C. LNG Heartbreak Averted, for Now–Will Petronas et al. Go Ahead?

Further to this post,

B.C. LNG Heartbreak, Petronas Section

will the consortium of government-owned Asian companies led by the Malaysians actually green light the project? Market conditions are not particularly propitious:

Federal Liberals approve Petronas LNG project in B.C. — with numerous conditions

Prime Minister Justin Trudeau’s government has approved Petroliam Nasional Bhd’s $36 billion Pacific NorthWest liquefied natural gas project on British Columbia’s Pacific coast.

Environment Minister Catherine McKenna, Natural Resources Minister Jim Carr and Fisheries Minister Dominic LeBlanc made the announcement near Vancouver late Tuesday [Sept. 27]. It was Prime Minister Justin Trudeau’s first decision on a major energy project after a pro-environment campaign swept him to power last year.

The project is “an important opportunity to grow our economy and shows how we are rebuilding Canadians’ trust in our environmental assessment process,” McKenna said.

The approval comes just as developers are shelving multibillion-dollar gas export projects from Australia to the U.S. amid weakening demand in Asia and Europe. Shipping consultants Poten & Partners forecast in March that at least a quarter of global LNG production would be “homeless” by 2021 as supplies surge.

The federal government placed 190 conditions on the project approval, which Petronas will have to meet in order to proceed. The conditions include a cap on carbon gas emissions. Petronas has said it will review the project after the government decision, which Trudeau had given himself until Oct. 2 to make.

No Guarantee

Carr has said the government would make its decision without any guarantees from the Malaysian state-owned energy company that the project would actually be built.

Pacific NorthWest includes an LNG facility on Lelu Island near Prince Rupert and a related gas pipeline and upstream components. It would ultimately produce up to 19.2 million metric tons a year of LNG, or what the company describes as up to one LNG tanker’s capacity each day.

The project was strongly supported by British Columbia’s provincial government, but local indigenous groups were divided amid concerns about its impact on salmon habitat. Trudeau had campaigned on stronger indigenous consultation.
Earlier on Tuesday, opponents of the project said they expected it to be approved and pledged legal action.

‘Adamant Opposition’

The best of British Columbian luck to the province. More here, here, and here (“Petronas in no rush to start”). Now what about those  pesky pipelines to carry product from the Alberta oil sands?

Mark Collins, a prolific Ottawa blogger, is a Fellow at the Canadian Global Affairs Institute; he tweets @Mark3Ds


7 thoughts on “Mark Collins – B.C. LNG Heartbreak Averted, for Now–Will Petronas et al. Go Ahead?”

  1. Can fed approval of Kinder Morgan oil sands pipeline from Alberta to Vancouver now be denied?

    “The politics behind the go-ahead for the LNG project in B.C.

    There was good reason that Alberta Premier Rachel Notley was so heartened by the federal government’s approval of a major liquefied natural gas project next door in British Columbia.

    It all but guarantees she will be getting the pipeline she so desperately covets.

    The decisions that Prime Minister Justin Trudeau’s government faces with regard to the Kinder Morgan and Energy East pipelines were always going to be more about politics than so-called social licence. With the decision this week to green light the Pacific NorthWest LNG enterprise in northern British Columbia, Mr. Trudeau has rendered that catch phrase even more meaningless than it already was…

    It is likely there was an important quid pro quo attached to the federal government’s support of the Petronas venture: B.C. government support for expansion of the Kinder Morgan pipeline to move Alberta oil to port in Burnaby, B.C.

    Mr. Trudeau will now approve a pipeline project (almost certainly Kinder Morgan’s) for two very important reasons: to show up the federal Conservatives by achieving something they weren’t able to do in 10 years in power; and to help Ms. Notley in her fight against right-wing forces in her province…”

    As for poor Energy East, from June:

    “Canadian Hydrocarbon Heartbreak: Energy East Pipeline vs Quebec First Nations and Others”


    Mark Collins

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