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First Nations groups oppose many LNG projects in B.C. despite Squamish greenlight

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British Columbia’s beleaguered liquefied natural gas (LNG) industry got some good news Wednesday when the Squamish First Nation approved the $1.7 billion Woodfibre LNG project (see artist rendering above) by granting the proposed development an environmental certificate.

The Squamish First Nation still needs to grant an environmental certificate to the pipeline that would supply the plant with gas. FortisBC, the operator of the pipeline, is said to have agreed to all the conditions set out by the Squamish First Nation, so in theory an approval for that part of the project should come shortly. The pipeline does cross the territory of other First Nations, adding to the uncertainty.

The go ahead from Squamish—whose traditional territory the LNG plant and pipeline would operate on—brings the project and LNG in B.C. one step closer to fruition, as the Woodfibre project has already passed a B.C. Environmental Assessment Office review, with the pipeline currently under review.

That being said, the good news on one LNG project comes at a time when other First Nations groups in the province continue to oppose many other planned LNG projects. One example of opposition comes from the Lax Kw’alaams First Nation, which recently turned down more than $1 billion from Petronas and have announced they will seek aboriginal title on the land where Petronas’ $36 billion LNG facility will be located. If aboriginal title is granted to Lax Kw’alaams in the wake of the Supreme Court of Canada Tsilhqot’in decision, it’s possible that even if the province grants Petronas permission to begin construction, Lax Kw’alaams could unilaterally halt or shut down the project.

Such opposition is unfortunate considering that B.C. has a lot to lose if LNG projects are not able to move forward. According to a recent Fraser Institute study, B.C.’s LNG industry has the potential to supply 11 to 20 per cent of the Asia-Pacific LNG market by 2020. The study went on to find the cost of delay imposed upon LNG investments in B.C., defined as export revenues forgone, is substantial at C$22.5 billion in 2020, rising to C$24.8 billion in 2025. The export revenues lost in 2020 would be equal to 9.5 per cent of B.C. GDP in 2014. Even if assumed sales are cut in half, B.C. still stands to lose export revenues comparable to five per cent of 2014 GDP.

Time is of the essence for B.C.’s LNG industry, as market share is increasingly being taken up by competing regions. While news of Woodfibre moving one step closer to construction is great, LNG in B.C. continues to face significant regulatory delays and other barriers, making LNG development an uphill battle. This is quite unfortunate with all that B.C. stands to lose.


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