It seems like only yesterday that British Columbians were being told that the province was on the cusp of LNG riches. In fact, it almost was.
Last October, Finance Minister Mike de Jong predicted: "We are poised to see the final steps taken. Every step of the way, there have been detractors and naysayers and people who have dismissed the opportunities."
Those final steps hit a speed bump last Friday when the Hawaii Public Utilities Commission nixed NextEra Energy's proposed $4.3 billion purchase of Hawaiian Electric Industries.
The decision effectively scuttled a 20-year agreement for Fortis to sell LNG to Hawaiian Electric that had been announced eight weeks earlier with all the customary fanfare.
Natural Gas Minister Rich Coleman boasted that the announcement "showcases British Columbia's capacity to supply clean energy to new markets."
His statement left a few things out, though. The devil is in the details.
The deal had a few hurdles to clear. Specifically, this one from Fortis' news release: "the agreement outlines the conditions to be met... including the approval of the merger of Hawaiian Electric and NextEra Energy Resources."
Both parties knew that approval was no slam dunk.
Last August, the state's governor, David Ige, made it clear that "Any time and money spent on LNG is time and money not spent on renewable energy and that his administration will actively oppose the construction of any future LNG receiving stations."
Friday, well-known in politics as the day the trash is taken out, lived up to its name last week.
The news out of Honolulu, Hawaii broke in B.C. at 8:00 p.m.
The merger was kaput. The export deal -- a long shot at best -- was pronounced dead this week.
B.C.'s long-promised pot of liquid gold has now passed through pretty well all the spin cycles.
In its 2013 election platform, the B.C. Liberal party pledged the LNG industry would create $1 trillion in economic activity and a $100 billion prosperity fund.
Speaking directly to detractors, the promise came with a tag line: "It's no fantasy."
The party's campaign still referenced the B.C. government's 2012 Labour Market outlook, which predicted the LNG industry would create up to 100,000 jobs.
A forecast scaled back after the election to something more resembling a footnote.
"The Province continues working closely with the industry to maintain and update occupational workforce projections for the LNG sector. However, these projections will factor into the Labour Market Outlook only once there is a final investment decision on one or more projects."
There was the periodic tease.
Premier Christy Clark continued to proclaim that the LNG industry had the power to fight air pollution in China, clear up smog in Los Angeles and finance increased support for the disabled.
Naysayers such as the Australia-based Macquarie Group, the Paris-based International Energy Agency (IEA) and Bloomberg News were dismissed out of hand.
Despite countless reports that the world faces a glut of LNG, the government's website to this day proclaims that "Global trade in liquefied natural gas doubled between 2000 and 2010 and is expected to increase by another 50 per cent by 2020."
The Macquarie Group suggested earlier this year that solutions to address the oversupply "would be for certain LNG expansions not to happen or for existing capacity to be closed."
In its November 2014 World Energy Outlook, the IEA reported that Canadian LNG costs could be among highest in the world, pegging the export price at between $13 and $14/MBtu (million British thermal unit).
LNG's spot price is currently less than $5.00 MBtu.
Other developments, such as the Russia-China gas deal in 2014 and Japan's restart of its nuclear energy facilities, never factored into the government's thinking.
B.C. may still see an LNG plant, but as for that $1 trillion in economic activity and $100 billion prosperity fund the only step left is to call time of death.
It turned out to be a fantasy, after all.
There's an upside for the government. The public never bought the hype in the first place.
According to a 2014 Insights West poll, "only 28 per cent of British Columbians trusted the provincial government when it comes to properly handling decisions about the fledgling liquefied natural gas sector."
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LNG stands for "liquefied natural gas." Natural gas gets chilled to -160 degrees Celsius so that it can be converted into liquid form. After it has been liquefied and compressed, it takes up much less space — about 1/600th less than natural gas. (Pictured: B.C. Premier Christy Clark speaking after an event for FortisBC's Tilbury LNG facility expansion project in Delta, B.C., on October 21, 2014.)
LNG is odourless, non-toxic, non-corrosive, and less dense than water. It is a by-product of decaying organic matter in rock layers formed below the earth’s surface millions of years ago. As the matter decays, the gas is trapped or isolated in the rock formations, which prevent it from surfacing.
Natural gas is a cleaner fossil fuel than coal, but carbon is still emitted when natural gas is burned, according to the Union of Concerned Scientists.
As of December 15, 2014, the provincial government had 21 proposed LNG projects lined up, mostly in Northern B.C. or along the south coast and on Vancouver Island.
Outlined in the LNG Strategy One Year Update, released in 2013, the provincial government has three key priorities to achieve the goal of three LNG facilities by 2020: Keep B.C. competitive in the global LNG market, maintain B.C.’s leadership on climate change and clean energy, and keep energy rates affordable for families, communities, and industry.
The province wants to use the estimated revenue (about $100 billion) from LNG projects to diminish provincial debt, reduce cost burdens for families and local communities, and support services such as education. Premier Christy Clark (pictured) said last year British Columbians would begin seeing revenue from LNG in 2017.
Groups opposing LNG development in B.C. cite risks for fire, low demand for imported LNG, and greenhouse gas concerns, according to non-profit organization Dogwood Initiative.
Environment Minister Mary Polak (pictured) brought in legislation requiring LNG to meet emission standards in October 2014 in order to make the industry much cleaner. Otherwise, corporations could face penalties. The target for greenhouse gas emissions is set at one-third below 2007 levels by the year 2020.
A factsheet by the B.C. government suggests the vast majority of run-off from rivers is untouched by industries. However, four Skeena River First Nations near Prince Rupert oppose the Petronas LNG project due to fears of what it could do to the salmon habitat, CBC News reported. (Pictured: Skeena River)
Premier Christy Clark said that B.C.’s natural gas supply is estimated at over 2,933 trillion cubic feet. With industry extracting about four trillion cubic feet of natural gas each year, that means B.C. has over 150 years of natural gas in supply, CTV News reported.
Malaysian energy giant Petronas delayed construction of an LNG terminal in Prince Rupert in December 2014, saying conditions weren't right to follow through with the project at the time. The $36-billion dollar deal would bring LNG across the Pacific in tankers to the Asian market. (Pictured: Petronas towers in Malaysia)
The provincial government signed an economic partnership agreement with two First Nations along the planned pipeline route for Kitimat LNG last April. Haisla Nation Chief Ellis Ross held a summit to address the job possibilities LNG developments near Kitimat would bring, and voiced his hopes that people from the area would be the first ones considered for these jobs. (Pictured: Kitimat)
In December 2014, Premier Christy Clark denied the NDP’s claims that she was planning on hiring temporary foreign workers to build LNG plants. “We believe that British Columbians have to be first in line for these jobs, but it's also true that there will be some need for some temporary workers to come in and support these projects when there are peaks in production and construction because we simply don't have enough people," she said. (Pictured: Clark tours FortisBC's existing Tilbury LNG facility before the groundbreaking for an expansion project in Delta, B.C., on October 21, 2014.)