$11 billion Pacific NorthWest LNG project approved 

By Kylie Williams

Lelu Island facility at Low Tide and Flora Bank.

Lelu Island facility at Low Tide and Flora Bank.

Following a rigorous, three-year environmental assessment, the fate of British Columbia’s largest liquefied natural gas project, Pacific NorthWest LNG, has been decided. Canada’s Minister of Environment and Climate Change, Catherine McKenna, announced the federal government’s approval of the proposed $11 billion natural gas liquefaction (LNG) facility near Prince Rupert on the northern B.C. coast at a press conference on September 27, 2016. The decision statement from the Canadian Environmental Assessment Agency (CEAA) places 190 environmental protection conditions on the project. The project’s majority owner, Malaysian oil and gas giant PETRONAS, is yet to make a final investment decision.

“The only way to get resources to market in the 21st century is if it can be done sustainably and responsibly,” said McKenna during the announcement.

The prolonged CEAA review commenced in April 2013 and examined the impact of the proposed LNG facility and shipping terminal on the environment around Lelu Island, off the coast of Port Edward south of Prince Rupert. The facility will receive natural gas produced by Progress Energy Canada (also majority-owned by PETRONAS) from the North Montney region of northeast B.C. The gas will travel via the 900-kilometre Prince Rupert Gas Transmission pipeline, which was approved for construction and operation in October 2015, from Hudson’s Hope to Prince Rupert to be cooled, liquefied, and exported to Pacific Rim markets in Asia.

“As the third-deepest natural ice-free harbour in the world, with close proximity to Asian markets and an efficient rail corridor, Prince Rupert’s port is extremely well placed in terms of global shipping of all goods from North America,” explains Veronika Stewart, communications manager for the City of Prince Rupert. Several LNG projects are proposed for the Prince Rupert area, she says, including ExxonMobil Canada and Imperial Oil’s joint West Coast Canada (WCC) LNG project, but Pacific NorthWest LNG is the furthest along.

According to the project website, an estimated 4,500 jobs will be created during construction of the facility. Once it is up and running, it will employ 330 people long-term and generate 300 spin-off jobs in the local community. The Conference Board of Canada estimates that the fully integrated project, including pipeline construction and all jobs from upstream to the facility, will directly and indirectly employ 18,500 people.

Bridge to Lelu Island Facility.

Bridge to Lelu Island Facility.

The project has the full support of B.C. Premier Christy Clark for the employment and economic benefits it will bring the province. However, LNG prices have fallen dramatically during the time taken by the federal government to carry out the environmental assessment, and could influence the financial viability of the project.

While the First Nations directly affected by the project have offered their support, an ongoing anti-LNG blockade on Lelu Island by NGOs and some opposing First Nations members continues to impede the fish and marine mammal studies being carried out in the areas around the island.

“We’ve learned from local community members and First Nations that the continued health of salmon, marine life, and their habitat are top priorities,” says a spokesperson for the project via a video on the Pacific NorthWest LNG website. To address the concerns regarding the fish feeding habitats of Flora Bank, the large estuary at the mouth of the salmon-bearing Skeena River, the company has proposed a 1.4-kilometre one-of-a-kind suspension bridge and trestle, designed to avoid all contact with Flora Bank.

“The two most difficult issues that we now have closure on are First Nations and climate,” explains Stewart Muir, executive director of Resource Works, a B.C.-based not-for-profit research and education group supporting responsible resource development. “We’ve heard from all of the First Nations directly-affected. There’s unanimity along the pipeline and where the pipe ends at the coast, and signed impact benefit agreements to create employment and other benefits.”

With respect to the climate issue, Muir adds, “We see a government in Ottawa that has worked very carefully through the controls that can be applied to ensure this is a defensible project and they have concluded that they can make it work. It wasn’t an easy decision, but ultimately found a path to support.”

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