Industry & Trade Fall 2019

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Industry And trades FALL 2019

Industry in our region

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Inside

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First Nation still waiting

for pipeline blast answers.....................................................................................

pg 4

Prince George economy

upbeat, studies show........................................................................................................

pg 6

P.G. construction

nears record levels...........................................................................................................

pg 8

Business leader

shaped construction sector..................................................................................

pg 10

CEO explains

petrochemical plant plan...........................................................................................

pg 14

Tourmaline

spending big in northeast...........................................................................................

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First Nations

ink LNG deal......................................................................................................................................

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Fort St. John mayor

wins top energy award.................................................................................................. a Division of

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@ pgcitizen

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First Nation still waiting

for pipeline blast answers

Lawyer Malcolm Macpherson speaks at a Lheidli T’enneh First Nation announcement in February they are taking Enbridge to court over the pipeline explosion on October 9, 2018 on their territory.

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atience is wearing thin for the First Nation (LTFN), one year after the Enbridge natural gas pipeline explosion forced members into a hasty evacuation.

In a statement, Malcolm MacPherson, the lawyer representing the First Nation in a lawsuit against the company, said the community is “no closer to any resolution or answers post explosion.”

The Oct. 9, 2018 blast kicked up a fireball seen for kilometres, produced ground vibrations strong enough to rattled windows in nearby homes and the LTFN band office over two kilometres away.

In the lawsuit, filed in February, LTFN claims Enbridge provided inadequate communications and emergency response.

As well as damages, the

Industry and trades

Are the key to our future Working for you.

shirley Bond MLa Prince george-Valemount Office:

1350 Fifth Avenue Prince George, B.C.

Toll Free: 1-866-612-7333 Phone: 250-612-4181 Shirley.Bond.MLA@leg.bc.ca www.shirleybondmla.bc.ca

a Message froM your LocaL MLas

Mike MorrIs MLa Prince george-Mackenzie Office:

Unit 102 - 1023 Central Street W Prince George, B.C.

Toll Free: 1-866-612-4194 Phone: 250-612-4194 Mike.Morris.MLA@leg.bc.ca www.mikemorrismla.bc.ca R0011749342

band is seeking an injunction ordering Enbridge to dismantle and remove the pipeline from LTFN territory.

About 139 kilometres of the Transmission South pipeline traverses LTFN territory and 1.5 kilometres runs through the southwestern corner of the LTFN’s Fort George No. 2 Indian Reserve.

“The community remains deeply traumatized by the explosion, and for good reason,” McPherson said.

“Enbridge claims to operate world class pipelines and emergency response systems, but Lheidli T’enneh has seen no evidence of this claim to date.

“Further, Canada’s Transportation Safety Board continues to fail to provide Lheidli T’enneh with assurances of safety and the integrity of the Enbridge

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pipeline system following the explosion.”

In a statement, Enbridge officials said it has taken steps to “validate and improve the safety” of the system, including more frequent inspections and improved screening to evaluate and schedule maintenance work.

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development,” officials added. “We have reached out to the LTFN to talk and remain open to sitting down and beginning a dialogue.”

Transportation Safety Board communications director Rox-Anne D’Aoust said its investigation is ongoing but also noted Enbridge was

The community remains deeply traumatized by the explosion, and for good reason “While we have to wait for the Transportation Safety Board report, we are committed to fostering a strengthened relationship built on our shared priorities of safety, environmental protection and economic

issued a safety advisory in June after the agency found cracking in 37 metres of the pipe taken in for analysis.

It attributed the trouble to the polyethylene tape coating, saying it tends to separate from the pipe and

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allow moisture to contact the pipe and shield it from the cathodic protection current, an electromechanical system used to prevent corrosion.

About 500 kilometres of pipe in the Transmission South system is coated with the tape, based on company records, the TSB further states, and suggests the company review its management practices to ensure the risks are mitigated.

“Investigations are complex, and we take the time necessary to conduct a thorough investigation to advance transportation safety,” D’Aoust said in an email. “Be assured that, if we uncover serious safety deficiencies during the course of our investigation, we will not wait until the final report to make them known.”

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Prince George economy

upbeat, studies show The Park House condominium project in downtown Prince George in September.

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bright economic outlook for the city is being expressed in two recentlypublished studies.

Both the Conference Board of Canada and Vancouver-based consultant MDB Insight see optimism for Prince George over the next few years, despite the turmoil in the forest sector.

After growing by a modest 1.3 per cent in 2018, Prince George’s economy is expected to pick up the pace and expand by 1.5 per cent this year and a further 1.7 per cent in 2020, according to the Conference Board study,

which provides outlooks for seven mid-sized Canadian cities.

The report notes other positive developments including: - The region’s unemployment rate edged down from 5.2 per cent last year to 4.9 per cent this year and is forecast to hold steady at 5.1 per cent in 2020.

- The region had near record housing starts in 2018 and building permit values continue to be very robust in 2019.

The study also notes the struggling forestry sector will

weigh on local industry, but indicates that a resolution to the U.S–Canada softwood lumber dispute would provide welcome relief to the region’s forestry sector.

MDB Insight, in turn, says Prince George’s economy is poised for continued growth as the economy thrives with new investments, projected population growth, and adaptation influenced by global economic shifts including growth in the services sector, and modern industry.

The study, which included a comprehensive survey of local businesses, in order to inform and support local businesses and the city to grow and strengthen the local workforce.

Key findings from the study include: - Most Prince George

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businesses have short-term plans to hire new employees (78 percent in the next year, 84 percent in the next two years).

- Over 85 percent of businesses indicate a skilled workforce is important for current operations and future growth.

- Most businesses identified barriers to hiring and retaining employees.

Recommendations of the report are designed to inform local businesses of best and promising practices for talent attraction and retention, inform on strategies to retain post-secondary graduates in order to grow the labour pool and local population, and strengthen business competitiveness.

Both reports are posted with this story at www.princegeorgecitizen.com.

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P.G. construction

nears record levels T

Prince George City Councillor Garth Frizzell

he value of construction activity occurring in Prince George is nearing last year’s record-setting pace, according to the latest building permit report from city hall.

During August, 61 permits for $28.2 million were issued, pushing the year to date total to $145.9 million and just $1.3 million shy of the mark reached by the same point in 2018.

“It looks like we’re on track for another year where we’re going to be breaking records with the amount of construction going on in Prince George,” Coun. Garth

Frizzell said during a city council meeting when the report was considered.

By the end of 2018, permits for a record-setting $186.4 million worth of work were taken out.

August was a banner month.

By comparison, permits for $13.3 million were issued in August 2018 and $13.7 million in August 2017.

Highlights for August 2019 include 13 permits for $7.3 million worth of new singlefamily homes, as well as for a three-home townhouse and a four-home townhouse, adding up to a further $1.6 million.

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It looks like we’re on track for another year where we’re going to be breaking records with the amount of construction going on in Prince George

On the commercial and institutional side, four were issued for $4.5-million worth of commercial building alterations, two for a pair of new commercial buildings, adding up to $12.5 million, three for $437,000 worth of new industrial buildings and one for a $700,000 institutional building alteration.

“This quiet boom keeps going on and it’s hard to put into the context with all of the challenges economically around us in the region,” Frizzell said. “But we keep plugging on and we keep seeing

the growth in construction and hearing stories of construction companies that are booked sometimes years in advance right at this point, so this is an incredibly promising time.”

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Business leader shaped construction sector A

Roz Thorn at her Prince George home in March 2017.

fter a battle with cancer, longtime Prince George business leader Roz Thorn died in early October. She was 70.

Kathy Nadalin’s Seniors’ Scene column featured Thorn in March 2017. Below is an excerpt of the original column: Roz (Rosalind Proverbs) Thorn was born in 1949 in the old Prince George hospital that was formerly an old army building.

Her father Rupert Proverbs was born and raised in Barbados where he grew up on a sugar plantation owned by his father. He immigrated to Canada in 1937 and joined the Canadian Scottish Regiment in 1939.

Her mother Margaret Cooke (Proverbs-Gracey) was born and raised in Leicester, England. Roz explained, “My mother was the second eldest of eight children, her family had a flour distribution business as well as a garage rental business; most houses didn’t have garages at that point in time so they rented them.

“Mom trained as a legal secretary and worked for the town clerk of Leicester. When my grandfather passed away in 1943, she took over and ran the family businesses until the end of the war when her brother returned from active duty. My mother met my father in England in 1943 and immigrated to Canada; they were married in Vancouver in 1946.”

Roz was schooled in Prince George and grew up on the banks of the Nechako River.

As a child, she joined Brownies, moved on to the Girl Guides and then into the Wrenettes. At the age of 16, she got involved in sorority and established the first and

only Beta Sigma Phi Teenage Chapter in Prince George with the assistance of senior sorority advisor Bea Wilson.

From early on, she had a driving work ethic beginning with a paper route at age ten, babysitting at age 12 and a part time job in the accounts office at Eaton’s when she was 16.

After high school, she attended the College of New Caledonia, taking business courses and joined the Prince George and Northern BC Construction Association as a “Girl Friday.” She was originally interviewed and hired by Henry Creuzot and Bob Borrie and mentored

by Nora Strawbridge. She worked her way to the top of the organization and after 48 years in the industry, she retired in 2015 as the chief executive officer of the association.

Roz reflected back and said, “I met Bob in 1967 during my last year of high school and we got married in June of 1969. Bob was a builder and loved anything to do with construction – we did lots of landscaping, gardening and home improvements together.

“Travel was a passion for both of us. We made so many good memories and lasting friendships through all our travels and I am thankful that we had that time together.

Sadly, Bob passed away in December 2013 at the age of 67, after losing an 18-month battle with cancer.

“He was a super star in supporting me through my career, always helping in the background and assisting me with preparations for work related events and travel. He always looked after things in my absence.”

Through Bob’s unending and dedicated support of Roz in

her career, he got to know many of the directors and members of the associated construction industry boards.

Roz said, “He was awarded the Chairman’s Award by my colleagues for all his volunteer work and when he passed away, the association established a bursary in his name.”

After 48 years with the Prince George Construction Association and nearly as much time with the B.C. Construction Association– North, Roz retired as their CEO in 2015.

She was successful in her climb to the top in a traditionally male dominated industry all the while earning the confidence and respect of the construction industry associations all over the province.

Many of her colleagues have testified that Roz had a tremendous work ethic and made a positive impact on the construction community in a variety of ways during her tenure. One of the quotes that I read about Roz when she received the 2008 B.C. Construction Association Distinguished Service Award which recognizes leadership and excellence said, “Roz is, without question, a class act.”

Roz summed it all up and said, “I had a great career. My mantra was that we needed one strong voice for the construction industry provincewide. We worked hard collaboratively and

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collectively through many years to achieve that voice that would benefit the association in discussions with government.

“One of my big thrusts has always been to have government recognize the need for expanding skilled trades training and other construction related training for the north, including having more up to date training facilities.

“I am proud to say that the PGCA has always been a strong community supporter; the list of projects we worked on and donated back to the community is long and impressive and included fundraising to support the many projects.

It was a pleasure to watch the northern economy grow toward its potential and at the same time adapting, revising and bettering the services for our association members.”

Roz served on numerous local, provincial and national committees and boards some of which include the United Way, Prince George Economic Development Commission, Provincial Apprenticeship Board, BCCA Employee Benefit Trust, Provincial Unity Panel, the College of New Caledonia, Prince George Progress Board, Initiatives Prince George, Northern Interior Mining Group/Resource Connector, and BC Liberals Prince George–Valemount Riding Association.

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CEO explains petrochemical plant plans Editor’s note: this is an edited and abridged version of the response from Ken James, the president and CEO of West Coast Olefins, to a series of questions from the Too Close 2 Home group about the proposed petrochemical plant in Prince George.

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e will not have any polyethylene plants on our site. This project involves: • One natural gas liquids recovery plant – the fractionation portion of that plant will be located on the West Coast Olefins site.

• One ethylene plant that will produce ethylene from

the ethane recovered in the above fractionation plant – this will also be located on our site.

• One polyethylene plant that will be developed by a third party and will not be located on our site.

The main chemicals that will be used in the proposed refining/ manufacturing process are: • Dimethyl disulfide (DMDS) (used for passivation of furnaces, small amounts) • Acid (used for regeneration of demin

Ken James from West Coast Olefins speaks in July about taking the first steps towards the construction of a $5.6 billion petrochemical project in Prince George.

treatment) • Amine • Caustic soda • Specific amounts of these chemicals will be determined during detailed engineering phase.

There will be no underground piping or hydrocarbon (HC) tanks.

This will reduce the potential for underground leaks. Along with

secondary containment procedures, there will be tertiary containment procedures (site contained stormwater systems, which control, capture, test and release any collected stormwater).

The plants will generate very few liquid/solid wastes. Those which are produced will be captured, contained and shipped

of site to the appropriate and accepted location for disposal. See the project description for a detailed list of liquid/ solid wastes and the proposed management and mitigation techniques.

We have not completed a survey of available waste disposal facilities in B.C., but the Swan Hills Waste Treatment Facility in Alberta is often used for Albertan projects and is close enough to be considered an option for waste disposal for WCOL Project.

There will be no tailings ponds in NGL recovery or ethylene plants. These are typical of mining projects.

Flare stacks are typically in the range of 150 feet. The height will be determined by proximity to other

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buildings and radiant temperature relative to ground level. The Nova E2 ethylene plant where I worked from 1989 to 1994 only flared during startup and shut down. There were no scheduled outages. The plant typically had less than one unplanned outage per year. From experience with Nova, the flare will usually last less than 10 hours during startup.

Startup and shutdown flaring typically occur every three to five years during periodic planned turnarounds that are scheduled to ensure the integrity of the plant and associated equipment. The flare system is a key safety system. It permits the safe release of compressed hydrocarbon during a serious upset or emergency.

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It is not intended as an incineration device as was often the case with older plants.

Modern flares are designed to have a combustion efficiency of close to 100 per cent. This means 100 per cent combustion to hydrocarbons to CO2 and water vapour.

Specific volumes will be reported within the Environmental Assessment (EA) Application. We must... complete sufficient engineering to make this determination.

The plant will process between 1.5-2 billion standard cubic feet of natural gas in Enbridge’s Westcoast Energy Pipeline and recover approximately 65,000 barrels per day of ethane, 26,000 barrels per day of propane, 9,000

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barrels per day of butane and 2,000 barrels per day of condensate.

The NGL recovery plant will produce ethane which will feed the ethylene plant. Byproducts from the NGL recovery plant are propane, butane and C5+ condensate.

The ethylene plant will produce ethylene, which will feed the ethylene derivatives plant.

Byproducts from the ethylene plant are mixed C3 (which consists of mainly of propylene (86 per cent) and propane (11 per cent), mixed C4 (which consists mainly of butadiene (45 per cent) and pyrolysis gas (consists of aromatics and heavy HC). These byproducts will be sold to third parties for further refinement to more cont. page 16

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cont. from page 15

valuable products.

The third-party ethylene derivative plant will produce polyethylene pellets.

The WCOL development will involve three separate plants. West Coast Olefins is only developing two of the three plants – the NGL recovery plant and the ethylene plant. The NGL separation plant and the ethylene plant will be on the Willow Cale site. The NGL extraction plant will be on a site located in close proximity to the preexisting Westcoast Energy Pipeline.

The ethylene derivitive plant, most likely polyethylene, will not be located on the Willow Cale site. It will be located on a separate site and will be owned by a third-party partner. No plastic plants

will be built on the 300acre site. WCOL does not make plastics. A third-party will make the polyethylene pellets.

We will be primarily shipping by rail from the B.C. Industrial Park to Prince Rupert. The advantage of Prince George is that this rail routing will ensure there is minimal disruption to local traffic as the rail runs under Highway 97 at the south entry to Prince George, under Highway 16 at the east entry and then along First avenue then under River Road and the two Nechako River bridges. All switching will occur on the BCR Site, a benefit of the proposed location. Other locations that have been suggested, such as Hart North, would require major

rail development and increase rail traffic greatly.

We will build our own rail system on our property adjacent to the CN rail line.

The West Coast Olefins property has approximately one mile of frontage on the CN rail line to Vancouver.

Following discussions with CN, there is a preference to route through Prince Rupert as it has the most available capacity. From Prince George, we have the option to route through Prince Rupert, Vancouver and Kitimat.

The advantage of building a new plant is that we have the option to implement state of the art technologies, processes and methods. New plants are significantly different to those built 40 years ago. For example, the first

Joffree Plant, started in 1979, used 50 per cent more energy (and therefore produced 50 per cent more emissions) to produce ethylene than the plant built in the early 2000s.

We have the advantage of implementing further advancements that have been developed over the past 20 years.

Raw material for the NGL extraction site will be supplied via Enbridge’s existing Westcoast Energy Pipeline, which delivers natural gas to customers in BC, Washington, Oregon and California and has been operating for more than 60 years.

We will only require a short pipeline from the pipeline to our BCR site to transfer recovered natural liquids for processing. cont. page 17

1995 Transportation - 31 Natural gas dehydrators - 8.7 Steel - 1.2 Petroleum distribution - 0.5 Petroleum refining - 0.4 Chemicals - 0.4 Residential wood -11 Miscellaneous combustion - 4.7 Prescribed burning - 0.5 Forest fires - 58

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2000 Transportation - 22 Natural gas dehydrators - 4 Steel - 0.4 Petroleum distribution - 0.5 Petroleum refining - 0.2 Chemicals - 0.1 Residential wood - 11 Miscellaneous combustion - 4.8 Prescribed burning - 0.4 Forest fires - 27

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2010 Transportation - 15 Natural gas dehydrators - 3.6 Steel - 0.1 Petroleum distribution - n/a Petroleum refining - 0.2 Chemicals - 0.1 Residential wood - 12 Miscellaneous combustion - 5.5 Prescribed burning - 0.4 Forest fires - 27

cont. from page 17

This transfer line will not impact operation of the Enbridge pipeline.

The data below is the estimated emissions in kilotonnes adapted from Benzene Emissions Inventory for Canada (1990-2010), illustrates where chemicals fit relative to other large emitters of benzene (note that the numbers are in thousands of tonnes per year). (see table above) As can be seen, the petrochemical industry has one of the lowest benzene emissions, with forest fires emitting 270 times more benzene in

2010, and residential wood (burning of wood pellets within the home, for example), emitting 120 times more benzene in 2010. If the Red Deer emissions are pro-rated down to reflect a single point, our plant, as Hay would project, then our emissions would .001 kilotonnes to the table or 0.0016 per cent of total benzene emissions.

The greatest exposure that most people will encounter is when fueling your car. The maximum benzene content for gasoline is specified as one per cent. About half

of the exposure to benzene in the United States results from smoking tobacco or from exposure to tobacco smoke. Benzene is a byproduct of the combustion of tobacco in cigarettes. The average smoker (32 cigarettes per day) takes in about 1.8 milligrams (mg) of benzene per day.

This amount is about 10 times the average daily intake of benzene by non-smokers.

The carbon emissions associated with our project is a very good story.

Extracting natural gas liquids from the Enbridge pipeline will make it a

cont. page 18

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cont. from page 17

much cleaner fuel when it is burned by downstream users where virtually all of the gas is burned as fuel in home heating, refineries and power plants. Cleaning up this large hydrocarbon fuel source by removing the heavy components (ethane, propane, butane and condensate) reduces carbon emissions that more than offsets the direct carbon emissions from our facilities. In addition, producing polyethylene in Canada from ethane and selling it into the Asia market will displace Chinese production where polyethylene is produced from coal but with 15 times the carbon emissions.

The criteria that was used in site selection by WCOL includes the following

considerations: reasonable commute for workers; utilization of previously developed industrial land; close proximity to critical infrastructure (road, rail, Westcoast Energy Pipeline); and local community capable of supporting the long-term operating and maintenance needs of our project.

The Pas Lumber Site was the first site considered and was identified by the provincial government as an abandoned industrial site that might be suitable for our project.

Considerations for not selecting this site included: disturbance of a large block of undeveloped land that would have to be disturbed to make this site suitable; the lack of

existing infrastructure such as water and railway; and the lengthy commute from Prince George that would pose the single most significant hazard to our workers and local residents using this highway.

The former North Central Plywood (Canfor) site was the second site considered and was located within the BCR Industrial Park.

The main attraction was the existence of all critical infrastructure our plant required and the fact that we would be utilizing land that had previously been used as a large industrial plant site. However, this site was not chosen for the following reasons due to the close proximity to College Heights, approximately 0.95 km away from the closest house in College Heights.

The Hart North “industrial park” is piece of Crown land that lies 30 km north of the city boundaries. It has not been transferred to any proponent that intends to develop it as an industrial park. For this to be considered a valid option, significant time, effort and money would be required to achieve the following: a proponent would need to be identified to develop this site, which we assume would be the Regional District (the land lies outside of the city, and therefore, Prince George representatives would have no jurisdiction over rezoning, or transferring land titles); an application would need to be made to transfer title from the Crown; and First Nations title rights and impact on treaty and Aboriginal

rights would need to be addressed as the Hart North site is located in the traditional lands identified in the McLeod Lake Indian Band treaty and overlapping claims with Lheidli T’enneh First Nation. Achieving all of these milestones will take several years, and there are several risks that this outcome will actually never be realized.

The distance between the proposed location of the ethylene plant, and the nearest house within College Heights is 3.65 km.

The proposed WCOL Site is located on the southeast boundary of the City of Prince George. Between the community of College Heights and the WCOL Site is the Fraser River, Chemtrade West, multiple fabricators within the BCR Industrial Site, the Pacific BioEnergy Plant and the CN rail line. We are located within the industrial area of Prince George. We do not border any schools, we are approximately 4 km from the nearest school and we are 3.65 km away from the nearest residential neighborhoods.

B.C. has a very stringent Environmental Assessment processes and the public should place some trust that these regulatory bodies will execute their duty and ensure there is adequate consultation with the public. B.C.’s regulatory regime is one of the most stringent in the world and we will need to ensure that we are using the best available proven technology if we hope to obtain regulatory approval for our project.

Tourmaline

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spending big in northeast

T

ourmaline Oil Corp. says it remains bullish on its operations in northeast B.C. and plans to spend $1.7 billion on gas exploration and development here over the next five years.

The company announced the news in Fort St. John and celebrated the commissioning of its new $200-million deep cut gas plant at Gundy alongside staff and elected officials.

“There’s no doubt that energy demand of all kinds is going to go up and we’re trying to position ourselves,” said Tourmaline COO Allan Bush.

“We’re in this for the long haul and we see this as a really good place to being doing business. We want to stay aggressive here.”

Tourmaline spent $1.8 billion on capital projects in the region over the last four years, and Gundy will remain the focus of growth as the company looks to capitalize on its liquids-rich holdings.

Included in the $1.7 billion of new spending is a $150 million expansion of the new Gundy plant, doubling capacity from 200 mmcf/d to 400 mmcf/d and increasing liquid volumes by 85,000 bbls/d. Butane and propane is already being shipped out of the region by rail to AltaGas Ltd.’s new terminal in Prince Rupert and exported to Asia.

New spending also includes drilling programs to support

the increased volumes, as well as new pipelines. More full-time jobs will be created in production, operations, construction, and technology, Bush said.

“The investment will be significant in the area,” Bush said.

The news was met with optimism from elected officials, who said the spending is a sign of confidence in both the region and future of the industry.

“To have the largest [gas] producer in the country make these investments with the knowledge and understanding that they have of the economics and what it’s going to look like in the future, it’s good news for all of us in northeast B.C. — it’s good news for B.C.,” Peace River North MLA Dan Davies said.

Still, many companies remain nervous, and drilling activity has slowed considerably, said South Peace MLA Mike Bernier.

“I hope we see more [investments],” Bernier said.

“We’re seeing the boots on the ground, the people who are hurt; they’re worried what does this mean for spinoff now to local contractors.”

Of Tourmaline’s spending over the last four years, the company says $312 million went to local businesses.

Energy Minister Michelle Mungall was also in Fort St. John for the celebration.

We understand as a company, we understand as an industry that has to be part of our game

She said natural gas is key to the renewable energy transition, and said industry and the province must take environmental standards into consideration when doing business.

“In B.C., the best way to create family-supporting jobs is through our resource sector,” Mungall said. “When I get news that Tourmaline is investing even more in British Columbia, I want to celebrate because I know what that means for communities, I know what that means for families, I know what that means for children, and the opportunities that gives them and the life they can have.”

Bush said Tourmaline is an environmental leader, lowering carbon intensity from its operations and recycling 92 per cent of the water it produces. Longterm plans for the Gundy

plant include tying into hydroelectric power from the Site C dam once it’s completed.

“We understand as a company, we understand as an industry that has to be part of our game,” Bush said. “Not simply because it’s mandatory, but because it’s the right way to do business today.”

Beyond its operations, Tourmaline is engaged in the community, Mayor Lori Ackerman said, and noted the company made a recent contribution to the upcoming 2020 Winter Games being held here in February.

“When you are intentional and specific about what… you are doing, and that is what Tourmaline is doing, then it’s important for us to celebrate that,” Ackerman said.

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First Nations

ink LNG deal

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our First Nations in northwest B.C. are planning to get in on the liquefied natural gas industry, and they are framing their effort as a climate change initiative.

The Nisga’a, Haisla and two Coast Tsimshian bands – the Lax Kw’alaams and Metlakatla – have partnered in an initiative called the Northwest First Nations Collaborative Climate Change Initiative (FNCCI).

They signed a memorandum of understanding in Vancouver to cooperate in the “planning, management, construction and ownership” of new LNG projects.

First Nations that are already participating in LNG and associated pipeline projects see the industry as a way out of poverty.

“In my community on the north coast, we have the biggest fishing fleet in B.C. that can’t make a living anymore,” said Lax Kw’alaams Mayor John Helin. “So we have to look at opportunities, and look after the climate.”

The Haisla are already benefitting from the $40 billion LNG Canada project in Kitimat, said Haisla Chief Crystal Smith.

“We can see the changes and the benefits (for) our people,” she said. “As First Nations leaders, it’s our responsibility, for not only protecting our environment...but it’s also our responsibility for the social aspect of our people.”

Helin said there is no particular LNG project proposed as of yet that the new partnership would participate in. They are

merely setting the stage to participate as partners in any future LNG proposals.

“With uncertainty in the province, we’re not going to have anything happen,” Helin said.“Not just First Nations, but industry and government want certainty. There still is a lot of interest out there on LNG, but there’s nothing concrete right now. We don’t have any projects that are for sure going ahead.”

The new partnership appears to be similar to the First Nations Limited Partnership, which is a $500 million partnership of 16 B.C. First Nations that acts as collective bargaining and investment group involved in the Pacific Trails natural gas pipeline – the pipeline that would supply gas to the Kitimat LNG project.

While environmentalists and the Green Party are framing LNG as a fossil fuel that will make it difficult for B.C. to meet its greenhouse gas reduction targets, the FNCCI partnership is framing it as a net benefit, as LNG exported to Asia would displace coal power.

Used to produce power, natural gas produces about half of the CO2 produced by burning coal.

Partly because B.C.’s upstream natural gas sector is being electrified, and partly because natural gas produced in the Montney formation in northeastern B.C. has a lower carbon content than gas produced in other regions – the Horne River, for example – LNG produced in B.C. is being marketed as being the lowest in the world in terms of its emissions intensity.

Natural gas produced in B.C. also is said to have lower methane emissions than natural gas produced in some other jurisdictions, due to regulations and best practices, such as green completions, which captures methane that would otherwise be vented or flared when new gas wells are fracked.

B.C.’s LNG carbon footprint would be even lower still if new LNG projects opt for electric drive for the LNG chilling process – something the partners behind the Kitimat LNG project have already committed to.

FNCCI consultant Alex Gyzbowski, principal of Pacific Resolutions, said it is estimated that using LNG to displace coal power could result in a reduction of 60 million to 90 million tonnes of CO2 per year.

That estimate comes from E3Merge Consulting, which estimated that for every tonne of CO2 produced in B.C. from the LNG Canada project, GHGs would go down by a factor of 10, if it displaces coal power in Asia.

B.C.’s total GHG output in 2017 was 64.5 million tonnes. So, if the E3Merge accounting is correct, exports from a single LNG plant in B.C. – LNG Canada – could conceivably cancel out B.C.’s entire annual greenhouse gas production.

But the way carbon accounting works under the Paris Agreement, GHG reductions achieved outside of a country don’t count.

The LNG Canada project would add an estimated 3.5 million tonnes of CO2 to

B.C.’s carbon budget annually – an increase of about 5.5% of what B.C. produced in 2017.

Under current Paris Agreement accounting, B.C. can only count GHG increases from the LNG produced here – it can’t claim any reductions that might occur outside of Canada.

There is a mechanism under Article 6 in the Paris Agreement that allows for Internationally Transferable Mitigation Outcomes (ITMO) that could conceivably be used to claim those reductions in B.C. It’s something Conservative Leader Andrew Scheer has talked about in his campaign platform, and federal Natural Resources Minister Amarjeet Sohi has also talked about the possibility of negotiating a kind of carbon swap using ITMOs. But getting those credits could be difficult to negotiate.

China and Japan, after all, are also signatories to the Paris Agreement, so any GHG reductions resulting from a switch from coal to gas is something they would want to claim for themselves.

Convincing Asian governments or industries to surrender at least some of their GHG reductions to B.C. might require some fairly high-level country-to-country negotiations.

However, it is something the Government of Canada is exploring. Acquiring ITMOs is one of the objectives in the Pan-Canadian Framework on Clean Growth and Climate Change.

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Fort St. John mayor

wins top energy award Canadian communities that grow alongside energy development, manage unique development opportunities Fort St. John Mayor Lori Ackerman

F

ort St. John Mayor Lori Ackerman has been named the 2019 Canadian Energy Person of the Year.

The Energy Council of Canada established the award in 2001 to recognize Canadian leaders making an impact for the energy sector on a national and international level.

Throughout her threeterm tenure as mayor, Ackerman has pushed energy literacy up on the city’s agenda and raised Fort St. John’s profile in provincial and national discussions about natural resource development in Canada.

“I have been recognized as someone who tirelessly speaks about building a significant community, thinking globally and the need to understand the energy industry; all the investment, infrastructure and consumer demand that goes with it rather than vilifying the industry,” Ackerman said. “Council has recognized that energy is not just a commodity it’s a responsibility.

Our initiatives have showcased the opportunities that municipalities have within their toolbox

to leave a lighter footprint.”

As part of the award, the Energy Council made a donation to the charity of Ackerman’s choice: Fort St. John and Area Senior Care Foundation.

The foundation runs on a small budget of just $28,000 and provides critical services for seniors such as Better at Home and Meals on Wheels, Ackerman said.

“This was an easy decision,” Ackerman said.

Energy Council President Jacob Irving said Ackerman was a deserving recipient.

“Canadian communities that grow alongside energy development, manage unique development opportunities,” Irving said. “Balancing economic highs and lows, while moving toward a sustainable future for both the community and the energy industry requires vision, tenacity and strong leadership.

Canada is fortunate to have a leader like Lori Ackerman who sees the big picture and the local reality and is able to fit the two together for mutual benefit.”