The first thing to understand about the race to liquefied natural gas exports is how far back in the pack B.C. is starting.
Canada has issued its first two export licenses for LNG export projects near Kitimat, to sell the product of the vast Horn River and Montney shale gas deposits in northeastern B.C. One LNG plant has begun construction, the second is approved to proceed and a third is also proposed for the same region.
Unlike the proposed Northern Gateway oil pipeline proposal, plants and associated pipelines have actually received all the necessary permits from our constipated federal-provincial environmental process.
Australia has approved six LNG projects in the last two years, with a combined construction cost of $180 billion. Reuters reports that their $34 billion Ichthys project will vault Australia past the Middle Eastern kingdom of Qatar into first place among global LNG exporters, assuming it is built by 2017. Top producing countries are Qatar, Indonesia, Malaysia, Nigeria and Algeria.
The second thing B.C. taxpayers need to know is that there is no other practical choice here. Huge shale gas developments around North America have meant B.C.’s days of making a tidy sum selling gas to the U.S. are coming to an end. Natural gas replaced forest products some years ago as B.C.’s top commodity revenue stream, helping to keep the lights on in B.C. schools and hospitals. But the domestic price is down for the long term and the U.S. has plenty of its own gas now.
The third thing to know is that there is misinformation about shale gas and “fracking.” Shaky videos show someone touching a match to water that has had gas bubbled through it, to artificially promote the idea that hydraulic fracturing of shale deposits contaminates groundwater. This, and some scientifically illiterate media reports, are all it takes to get a protest movement going these days. The fact that a kilometre or more of solid rock separates B.C. shale deposits from surface water sources is seldom mentioned.
The major public health risk from B.C.’s natural gas boom is the escape of sour gas, which contains poisonous, heavier-than-air hydrogen sulfide. That’s been a problem for B.C.’s conventional gas industry for decades.
There are legitimate concerns about water use and chemical discharge from shale fracturing, and the B.C. government has scrambled to upgrade its regulations on that as well as sour gas.
Premier Christy Clark has run to the front of the LNG parade, trying to convey the notion that multi-billion-dollar investments made years ago by Chinese, Japanese, U.S. and Korean corporations are somehow the result of her “jobs plan.”
NDP energy critic John Horgan insists that the B.C. Utilities Commission oversee all this, so the B.C. Liberals don’t subsidize these giant transnational energy companies with cheap electricity and stick BC Hydro ratepayers with the bill.
According to Horgan, the BCUC should also have lawyered away over the smart meter program for God knows how long, as analog meters become obsolete and Quebec and others modernize their electricity grids without hand-wringing or exploitation of imaginary health threats.
This is not a good time to dither. An LNG terminal is proposed for Portland, Oregon and there will be others.
LNG plants need lots of electricity, and the B.C. Liberal government wants to market B.C. LNG as the “cleanest” in the world because it’s processed with minimal burning of gas for power generation.
Will foreign buyers care about B.C.’s LNG production methods? Are B.C.’s greenhouse gas reduction targets history? More on that in a future column.
Tom Fletcher is legislative reporter and columnist for Black Press and BCLocalnews.com.