Fraser Forum

Green groups, First Nations sue federal government over proposed B.C. LNG plant

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After the September approval of the Pacific Northwest natural gas project in British Columbia (with 190 additional regulatory requirements added on), there was a slight feeling of optimism among those who believe that developing Canada’s oil and gas resources is critical to our well-being, and that of future generations of Canadians.

In one column in the Globe and Mail, Jeffrey Jones opines that the Pacific Northwest approval offers a glimmer of hope to Alberta, which is desperate to get pipelines build to move its oil to tidewaters:

The federal approval for the LNG project has given the oil patch some optimism that the government may also give a nod to Kinder Morgan Canada’s $6.8-billion Trans Mountain expansion, which would offer major new access to overseas markets for Alberta’s oil sands-derived crude. This is a bet on body language, however, as there are no guarantees amid staunch opposition by the mayors of Vancouver and Burnaby, B.C., as well as some First Nations and a host of green groups.

Well, so much for optimism. As Mr. Jones observed, the LNG project is opposed by green groups as well as by some First Nations groups, and it didn’t take long for them to head to the courts.

Aboriginal and environmental groups plan to file lawsuits on Thursday against the government of Canada to overturn the permit for a controversial $27-billion liquefied natural gas (LNG) project in British Columbia, representatives of the groups said.

The planned lawsuits will name Malaysian state oil firm Petroliam Nasional Berhad (Petronas), which owns a majority stake in the project, as an associated party, the groups told Reuters this week.
Successful or not, the legal challenges will likely add additional years to even starting work on the project, much less realizing the potential earnings, revenues and royalties from the project if it actually commences operations.

As we wrote last year, the continued obstruction of British Columbia’s natural gas development comes at a high cost to British Columbians:

Under the conservative assumption that actual sales of BC LNG to Asia-Pacific importers would be only 11 per cent to 20 per cent of that market in 2020, the annual export revenues lost due to delay would be equal to between two per cent and 9.5 per cent of B.C.’s GDP in 2014. This cost is substantial: CA$22.5 billion in 2020, rising to CA$24.8 billion in 2025.

Green groups, and some anti-gas First Nations, may continue to successfully stymie Canadian resource development but it will come at a high cost to Canadians, and potentially the environment. Canadian natural gas, sold to markets in India and Asia, could displace some of their need to generate power with coal. To the extent that substitution happens, Canada could contribute to helping preserve a healthier planet.


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