Vancouver/Victoria (Globe and Mail) – Let the job promotion begin. Provincial politicians will now be pushing the notion that mass job creation in the North, from LNG, is a reality. You may have noticed former Global TV News Reporter Jas Johal doing PSA’s on the safety of LNG extraction.
The bottom line is the deal is done. Well, the NEB doing the final rubber stamp should be fairly easy to get to. This is not a project that Victoria wants to lose because an election was literally fought on the premise that this would move forward.
The B.C. government has signed a project development agreement with the Pacific NorthWest LNG joint venture led by Malaysia’s Petronas.
Both sides agreed in May, 2014, to assign officials to prepare the terms of reference, leading to the deal. The project development agreement is subject to approval later this year from the B.C. legislature.
The B.C. government said its deal with Pacific NorthWest LNG is consistent with similar pacts in Australia, which is years ahead of Canada in exporting LNG.
“Today reflects the beginning of the company’s final decision path toward an investment decision,” Ms. Clark said in a statement.
Mr. Culbert added that Wednesday’s signing is important because it “provides the certainty that our investors need as we approach a decision whether to proceed with the project.”
The project development agreement spells out broad terms for taxes and B.C. LNG rules. Further details will be disclosed later this year.
There will be a separate 23-year royalty agreement from 2016 through 2038 on natural gas production in the North Montney region in northeastern British Columbia, where a Petronas-led joint venture operates. B.C. ministry officials forecast $8-billion from Pacific NorthWest LNG in royalty revenue to government coffers over the 23-year period In addition to royalties, a tax framework will start with a minimum 1.5-per-cent rate, applying to net operating income.
Pacific NorthWest LNG has yet to make a final investment decision and the Canadian Environmental Assessment Agency recently restarted its review of the controversial project. Federal Environment Minister Leona Aglukkaq could render a final decision on the LNG project some time between mid-September and early October, depending on whether there are further delays in the lengthy regulatory process.
Lax Kw’alaams members recently overwhelmingly rejected a $1-billion cash offer over 40 years from the LNG venture, declining to give aboriginal consent to plans to build an export terminal on Lelu Island, located next to Flora Bank in northwestern British Columbia. Flora Bank, a sandy reef-like area, contains eelgrass beds crucial to the survival of juvenile salmon in the estuary of the Skeena River, according to the Lax Kw’alaams band.
Pacific NorthWest LNG wants to construct a 1.6-kilometre-long suspension bridge over Flora Bank, and then connect with a 1.1-kilometre-long trestle that would start on the western edge of Flora Bank and extend in a southwesterly direction beyond Agnew Bank.
Petronas and its Asian partners previously considered but dismissed an option that would have tunnelled under Porpoise Channel from Lelu Island to nearby Ridley Island, and then placed LNG pipes along a trestle originating from Ridley Island and toward a marine terminal in Chatham Sound.
Pacific NorthWest LNG, which wants to launch exports as early as 2019, believes time is of the essence because fierce global competition will create a glut of LNG supplies and squeeze out most of the 19 B.C. LNG proposals, analysts say.