Report LNG investment for Kitimat has been approved puts B.C. government on shaky ground

VANCOUVER (NEWS 1130) – So far it’s only a single report from Bloomberg News, but with word a $40-billion LNG is a project is a go on B.C.’s north coast, there are big implications for the stability of our provincial government.

Bloomberg reported Sunday that all the investment has been lined up for the LNG Canada megaproject in Kitimat.

“LNG Canada — comprised of [Royal Dutch] Shell Plc, Malaysia’s Petroliam Nasional Bhd, Mitsubishi Corp., PetroChina Co. and Korea Gas Corp. — is set to announce a final investment decision on the C$40 billion ($31 billion) project as early as Monday, said people with direct knowledge of the plans, who asked not to be identified because the matter isn’t public,” the Bloomberg report reads.

“The exact timing still hasn’t been decided. PetroChina and Korea Gas announced approvals of their share of the investment on Friday. The others partners declined to comment.”

Deputy Chief Economist Bryan Yu with Central 1 credit union says the apparent final investment decision is good news for B.C.

“It’s a very positive development for BC, in particular for our northern communities. We expect — if it does go forward — quite a bit of economic activity through the capital expenditure phase of the project, but also a lot of interprovincial migration as individuals start to flock into northern communities from Dawson Creek to Kitimat.” Yu tells NEWS 1130.

He believes there is potential for more LNG projects to follow.

“I think there will be a bit of a ‘wait and see’ approach to see if there are any cost overruns. Right now the labour market in BC is very tight, and this will make it tighter, but we would expect see some inflows of labour to facilitate that,” he says. “But it could potentially trigger other LNG projects to go forward.”

Work has already started on the huge facility in Kitimat, which would export liquefied natural gas to Asia and bring a long-promised economic lift to B.C. and an employment boom to the north coast.

But there are big implications for the stability of Premier John Horgan’s NDP government, which is being propped up by the BC Green Party.

Yesterday, Green leader Andrew Weaver tweeted his party will not support any required LNG legislation put forward by the NDP, previously stating that LNG facilities could drastically increase greenhouse gas emissions.

Weaver has warned he could end his support for the NDP and potentially force an election over the LNG issue.

Meanwhile, BC Liberal MLA Jas Johal — who was previously a BC LNG Alliance spokesperson — points to the work done by the former Christy Clark government to attract liquified natural gas investment to BC.

“An FID is testament to the heavy lifting done by the BC Liberals, First Nations and non-First Nations communities, to get this project past the finish line,” Johal tweeted.

The BC Legislature returns for the start of what could be a shaky fall session Monday.

 – With files from Richard Dettman