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Good Times Will Prevail
Good Times Will Prevail in Northern BC
BRUCE CAMERON, CONTRIBUTING COLUMNIST, BLACK PRESS
The announcement, made with great fanfare in October 2018, said the future of BC lies in tapping and exporting huge reserves of natural gas, a cleaner-burning fuel experiencing rising demand in Asia, as an alternative to coal-based power plants. Hopes were high for the LNG industry to revitalize all of BC, but in particular northern BC.
As Premier John Horgan stated, “The critical importance of this project is what it represents — the intersecting of economic development, jobs for local workers, partnerships with Indigenous communities and forward-looking climate leadership.”
But the road ahead has not been smooth, with fluctuations in global gas prices, international competition for markets and environmental and First Nations opposition creating serious roadblocks. Adding to the uncertainty is the COVID-19 crisis, coupled with a dramatic oil price war between Saudi Arabia and Russia, causing oil prices around the world to plummet. For northern BC, uncertainty seems to be a constant bedfellow when it comes to LNG hopes and dreams.
Supporters of the LNG boom such as Resource Works—a public advocacy group in BC that supports responsible resource extraction projects—argue that environmental concerns have been diligently addressed. They point to the unblemished safety record of handling and shipping LNG, which dissipates into the air in the unlikely event of an accident at sea. Resource Works also points out that wages in the LNG sector will average over $105,000 per year, a heady sum for a region that has recently witnessed the impact of depressed forestry activity and wages.
Despite rising uncertainty, the promise of good-paying LNG jobs and the related economic stimulus created by the LNG boom is starting to be felt all across northern BC in 2020.
One project currently underway, LNG Canada, involves an international consortium spending $40 billion in three phases over the next decade. The first phase involves construction of the Coastal GasLink
– JOEY PREVOST, MACCARTHY GM
pipeline to transport natural gas from the Peace River area to Kitimat. Subsequent phases will require thousands of skilled trades to put together the components of the processing facilities, scheduled to begin. And then there is construction of improved port facilities in phase three.
In addition to LNG Canada, there are over a dozen other proposed projects of varying sizes that promise to inject money into the economy in northern BC, including four other gas transportation pipelines terminating in Prince Rupert and Kitimat which cross through the communities of Terrace and Smithers.
The general manager of one dealership in Terrace, BC, Joey Prevost, of MacCarthy GM, says his dealership has already seen 38 per cent growth in sales in 2019. Furthermore, he expects up to 150 per cent
growth, mainly in fleet sales, in 2020.
The impact is also being felt in fixed operations, with a surge in parts and service expected to continue over the next several years.
By no means is it smooth sailing for all of the LNG-related proposals. Considerable opposition to the building of pipeline corridors will wind its way through the courts for many months if not years. And project proposals costing billions of dollars of investment also require multiple partners, who may have second thoughts. One such project is Kitimat LNG, about half the size of LNG Canada, which faces adjustments since Chevron announced its intention to sell its 50 per cent stake in the project in December 2019.
Prevost says he “fully expects somebody else to step up and take Chevron’s shares,” ensuring the project moves ahead.
The scope and scale of growth the region is about to experience “will be an eye-opener,” says Prevost. In the case of MacCarthy GM, he says the ownership group has taken a calculated gamble to ramp up staffing in anticipation of the business that will arrive in town in 2020 and beyond.
