BRITISH COLUMBIA

LNG In B.C.: Petronas Investment Suggests No Pipe Dream, Rich Coleman Says

10/07/2013 02:55 EDT | Updated 01/23/2014 06:58 EST
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VANCOUVER - British Columbia's minister of natural gas development says a commitment by a Malaysian national company to build a liquefied natural gas plant in B.C. and investment by other countries suggests the province isn't chasing an LNG pipe dream.

"I think we actually have the major players in liquefied natural gas here," Rich Coleman said. "There's at least 10 of them here with significant opportunity to want to make some investment."

Coleman will leave Friday for Malaysia, South Korea and China to promote what he calls B.C.'s competitive advantage when it comes to the LNG industry.

"South Korea, for instance, is a major consumer of energy, and the second-largest importer of liquefied natural gas in the world," he told a news conference Monday.

Coleman said B.C.'s abundant natural gas supply could provide Asia's needs for 84 years through several proposed plants in a province where the temperate climate means making LNG takes less energy.

He said the province has signed pipeline agreements with many First Nations to create a stable environment for the proposed industry, which Premier Christy Clark has said will be the cleanest in the world despite criticism about pollution from LNG operations.

While the government is pushing the development of three LNG plants in northern B.C. by 2020 as a massive economic opportunity, the province is not neglecting other sectors, Coleman said.

He said eight new mines are being opened and nine others are being expanded by 2015 while the province proceeds with the Site C Hydro project to ensure long-term clean power, Coleman said. That facility is currently undergoing a two-year environmental assessment process.

On Sunday, Prime Minister Stephen Harper received news in Malayasia that the country's state-owned oil and gas company Petronas will invest $36 billion in B.C. on an LNG plant and the pipeline to transport the gas.

"The company still has to make its final investment decision but they have optioned property up in Prince Rupert, they've been doing their geotechnical test on the land to determine the feasibility of their plant and where they would put it," Coleman said.

He said the province has been negotiating a tax regime for LNG and could make an announcement in November.

"We're going to have to lock it down with some complex legislation to make sure people know that there's certainty around their investment in British Columbia so somebody can't just come in and arbitrarily change it after you've made billions of dollars of investment, which has happened in some jurisdictions around the world."

The companies involved have promised to deliver the cleanest energy anywhere, Coleman said.

"There is some fair argument around the fact that if we send natural gas to Asia, particularly China, if we replace coal and fix their greenhouse gas emissions down that we as a jurisdiction for the resource should get some credit worldwide."

British Columbia currently has more than 10 proposed LNG projects, and three of them have approved export licences from the National Energy Board.

Clark has said B.C.'s opportunity to export LNG to Asia could pump $1 trillion into the province's economy by 2046 and potentially create 100,000 jobs.

She is heading to China, Japan and Korea as part of a jobs and trade mission that will further promote liquefied natural gas development to possible investors.

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