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Bryan Cox: Setting the record straight on LNG from B.C.

It’s time to set the record straight on LNG from B.C. 

B.C. will produce liquefied natural gas with the lowest emissions of any LNG facilities in the world because of our strict environmental regulations that limit emissions. 

This means B.C. will meet rapidly growing global demand for LNG with the lowest-emissions LNG available. 

Global demand for LNG is set to increase dramatically. The International Energy Agency predicts demand around the world for LNG will increase by more than 10 per cent over the next five years, reaching more than 4.3 trillion cubic metres in 2024 because dozens of countries are turning to natural gas to reduce their emissions and provide cleaner air for their citizens. Natural gas also helps countries use renewable energy by acting as a backup when the sun doesn’t shine and the wind doesn’t blow. 

The World Health Organization says climate change and air pollution are the two greatest environmental risks to human health right now. More than seven million deaths each year are attributed to air pollution, with women and children disproportionately affected because they often breathe the dirtiest air, from indoor coal and dung fires for cooking and heating. 

LNG will help those most affected by climate change and air pollution by reducing particulate matter and greenhouse gas emissions. 

Sustainably produced LNG helps address both crises because on a lifecycle basis, LNG has far fewer emissions than coal and when used for power generation, just a fraction of the particulate matter that contributes to smog and air pollution. 

Because of provincial and federal climate policies for development of LNG in B.C. and Canada, LNG projects in B.C. will have at least half or less the emissions intensity of other LNG projects in the world. 

B.C. is the only place in the world with three all-electric LNG projects under development. Electric drive turbines significantly reduce the total greenhouse gas emissions of an LNG project when they are powered by clean electricity. 

B.C. is also the only jurisdiction in the world, aside from Norway, with a carbon tax on LNG. LNG projects in B.C. will pay a carbon tax of $40 per tonne which will increase to $50 per tonne by 2021, which encourages LNG projects in B.C. to reduce their emissions as much as possible. 

What this means is that natural gas from the LNG Canada project, when exported to Asia, accounting for methane emissions, can provide enough energy to replace or displace 20 to 40 coal-fired power plants with cleaner-burning natural gas. This could reduce global GHG emissions by 60 to 90 million tonnes of CO2 each year, an amount greater than the total annual emissions of British Columbia, and roughly 10 per cent of Canada’s annual GHG emissions. 

Because of British Columbia’s vast natural gas resource and proximity to Asian markets, there have been numerous “proposed” LNG projects in B.C. in recent years. 

The reality is, very few proposed LNG projects reach a final investment decision. LNG projects are incredibly complex and require significant amounts of capital investment — in the billions of dollars — to begin construction and reach operational stage. Only the most competitive projects, with First Nations support, community support, and federal and provincial environmental assessments will reach final investment decisions. 

The B.C. LNG Alliance’s seven members represent some of the most experienced LNG developers globally. Of our seven members, only the LNG Canada project has made a final investment decision. The electric-drive Woodfibre LNG project is working toward such a decision later this year, Chevron Canada and Woodside Energy continue to work on their all-electric facility, and Fortis BC is expanding its Tilbury LNG project it has operated since 1971 in Delta.

B.C. is a world leader when it comes to reducing methane emissions when we produce natural gas. Facilities such as Shell’s Groundbirch natural-gas plant near Fort St. John have already achieved zero-emission wellpads by finding and eliminating methane leaks and powering the sites with solar energy and renewable electricity from B.C. Hydro. 

Major research initiatives are underway to improve our knowledge and to find solutions to detect and manage methane emissions, including fugitive emissions. Geoscience B.C. has partnered with NASA and InDro Robotics to launch a GhG Map research project to develop aerial, unmanned site surveys of GhG to detect, quantify and source GhG emissions. Work is also underway through the B.C. Oil and Gas Research and Innovation Society to monitor fugitive emissions with drone technology.

Our ability to develop natural gas with lower emissions was recently recognized in the environmental assessment for the proposed Tacoma LNG facility, which determined that the natural gas to supply the facility should only come from B.C. because our regulations, technology and clean electricity produce natural gas with five to eight times fewer emissions than natural gas produced in the U.S.

LNG from B.C. will provide the world with the lowest-emission source of LNG as global demand is rising. If B.C. fails to develop LNG, we have not reduced global emissions, but instead increased emissions by having LNG demand supplied by countries that produce LNG with much higher emissions. This is carbon leakage.

B.C. and Canada have an opportunity to be a global leader in providing the world with the lowest-emission LNG and sharing our clean LNG technology with the world. 

If we do not develop LNG in B.C., we miss out on this opportunity. We also miss out on the opportunity to add value to our already responsibly produced natural gas by creating new jobs, business and training opportunities here in Canada. 

The LNG Canada project alone has already provided more than a billion dollars in contracts to Canadian businesses, including $175 million in contracts awarded to First Nations businesses and contractors, this is in addition to $100 million in contracts already awarded to First Nations businesses and contractors before a FID. An additional $620 million in contracts has been awarded to First Nations businesses for the Coastal GasLink project that will supply natural gas to LNG Canada in Kitimat.

We have every reason to develop an LNG industry in B.C., including reducing global emissions, providing the world with cleaner air to breathe and providing opportunities across the nation, including opportunities for First Nations. 

This is our opportunity. Let’s build it together. 

Bryan Cox is president and CEO of the B.C. LNG Alliance.


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