Industry looks to feds for continuity, new breaks and time-sensitive environmental review process
Even amidst a potentially project killing drop in the price of natural gas, B.C. is set to lead the country in natural gas production growth over the next two decades, according to a report from the National Energy Board—its first public long-term energy outlook for the province.
The report comes as the nascent LNG industry convenes with public officials and aboriginal leaders for the fourth annual LNG Export Conference held Tuesday through Thursday in Vancouver. High on the agenda: the federal government's new environmental and fiscal rules for LNG plant builders.
In a scenario where at least two plants move ahead by the early 2020s, B.C.’s share of natural gas production could increase from 27 per cent to 46 per cent by 2040—a significant windfall for federal and provincial coffers. In other scenarios, which put focus on the conditions and exemptions that the Trudeau cabinet might give to Pacific Northwest LNG, the first major project to come up for approval.
"I’m betting they’re going to approve but we just don’t know what the conditions will look like,” says Conservative MP Bob Zimmer, a speaker at the conference and a former point man on the file when he was in government. “There are huge concerns about the potential conditions, it’s one thing to approve a project and think you’re out of the woods, but the conditions upon it can completely change it or make it impossible.”
Zimmer points to the accelerated capital cost allowance, an estimated $2-billion tax break introduced by the Tories in 2016, but a necessary condition for putting the gears in motion for projects like Petronas’s proposed $36-billion plant, he says. Nonetheless, as the potential return for exporting natural gas drops, many in the industry are nervously watching how the federal government will treat Pacific Northwest LNG: "They’re all waiting for PNW to come through to get sense of which way the wind is blowing; they say the government is supportive but how much? There’s a cautionary feeling in the room.”
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