LNG Canada CEO Jason Klein recalls the day last March when the first module for construction of the Kitimat gas terminal arrived by ship through the Douglas Channel.
Standing 10 storeys and weighing 4,800 tonnes, it was an unforgettable sight and a monumental event.
“It was the culmination of years, moving rivers and moving fish and honouring our commitments,” said Klein. “It was such a big deal in Kitimat when that ship pulled in and I think the big accomplishment is that now, when a ship rolls in with (another) module it’s just another Wednesday. It happens so routinely we’re used to it, so our plant has risen from the ground in the last year.”
Considered the most expensive private investment in Canadian history, the $40 billion LNG Canada project has so far awarded $3.9 billion in contracts and procurement to B.C. businesses and of that total, more than $3 billion will go to Indigenous businesses in the Kitimat-Terrace region. Now 80 per cent complete, the company currently has 6,000 workers dedicated to the project and is now hiring between 200 and 250 operating staff to run the terminal.
“The world is watching; the world wants to know if Canada, and specifically B.C., can delver megaprojects and I’m proud to say we’re still on track to deliver LNG Canada by mid-decade as we promised when (the final investment decision was made) in 2018,” said Klein who spoke this week at the BC Natural Resources Forum at Prince George Civic and Conference Centre.
“We will prove that Canada can deliver megaprojects and I hope on the back of that, that allows the next wave of projects, most of which are Indigenous-led, to follow behind us.”
Fed from a terminal at Dawson Creek, the natural gas will travel to 670 kilometres to Kitimat through the Coastal GasLink pipeline, a construction project worth $11.2 billion. Coastal GasLink president Bevin Wirzba is equally proud of the work that’s been done to connect the LNG Canada terminal with the processing plant in Dawson Creek. Pipeline construction, which began in 2012, is expected to be finished by the end of this year.
“Through the balance of COVID we developed a pipeline across two mountain ranges in some of the most complex territory anywhere in the world,” said Wirzba. “That was likely the busiest construction season on record in Canada with nearly 18,000 workers and the vast majority of those in British Columbia.
“In combination with the $3-plus billion that LNG Canada has contracted with local and Indigenous communities, you add our activities and you get to a $5-plus billion number and that’s a very significant contribution to the economy, particularly in northern B.C.”
One of the highlights of 2022 for Wirzba and Coastal GasLink came in March when 16 First Nations signed an equity option agreement which gives those Indigenous partners a share in the profits the company will make with its pipeline.
“What we’re really excited about and what we’re focused on in terms of working with Indigenous communities is we plan to be in partnership for 40-plus years and that can provide enduring opportunities and build businesses,” said Wirzba. “When you talk about a global infrastructure project, which it is, it’s the small community businesses that we’re seeing being grown that will eventually just strengthen the communities across the province.”
When the terminal becomes operational and begins loading container ships with liquid natural gas destined for Asian markets, LNG Canada’s facility is expected to have the world’s lowest greenhouse gas emissions.
The tugboats to be used to pull the carriers through the channel to open seas will be the cleanest tugs in the world. Made by Sanmar Shipyards in Turkey in a joint contract with HaiSea Marine of North Vancouver they will produce three liquid natural gas-powered tugs and two that run on electric batteries.
“This project has the equivalent impact of reducing 10 per cent of Canadian emissions,” said Wirzba. “So it’s something that is world-class in scale but is not necessarily seen as a really transition and a global impact and that’s message that hasn’t been shared broadly cross the country.”
Coastal GasLink and LNG Canada are united in their support for the proposed Cedar LNG Project at Kitimat which is being led by the Haisla First Nation. If it goes through, Cedar LNG will share the Coastal GasLink pipeline capacity.
For the rest of the world looking for fuel security it’s all about displacing coal as a heat source and weaning its dependency on Russian gas. B.C., with its abundant natural gas supplies and pipeline connections to Alberta and Saskatchewan, is well-positioned to benefit from that global need for stability.
“The LNG development and the LNG facilities themselves are not only world-class, they’re cost-competitive and they’re done at the highest standards sustainable standards, globally and environmentally “ said Wirzba. “What I often hear is the problem is in Europe or the problem is somewhere else. LNG is a global commodity and by pointing LNG barrels over to Asia, which has half the sail time from the Gulf Coast, it can offset the growing utilization and reliance on coal.
“After the tragic invasion of Ukraine we saw the highest increase in emissions in a single year and it was because the resurgence is coal-fired fuel usage across the globe. I wish people would understand LNG is a low-carbon solution that can support energy transition in other parts of the world where there isn’t an ability to have gas like we have in their backyard.”
Looking ahead to the next decade, Klein said he’s confident that by 2033, LNG Canada will have delivered thousands of shipped cargos safely to customers around the world. At the forum he also discussed Phase 2 of LNG Canada, which would build a terminal built with compressors powered solely by electricity.
“In terms of Phase 2, we are actively in discussions with our partners and with governments and other stakeholders,” Klein said. “We do have a fully permitted plant for Phase 2 that would replicate Phase 1 but we are conscious of the environment we’re in and we’re always striving to do better, so we have spent a lot of effort in engineering to look at is it feasible to move to electrification because that’s the next step.
“It is feasible, but right now that power and that capacity is not there in Kitimat. In 10 years I hope as I stand and look at our ships sailing out that I’ll look around the corner at Douglas Channel and see ships sailing away from the Cedar facility and hopefully other facilities in Canada. It would be a shame if LNG Canada is the last big project, I hope we’re paving the way for the next wave of projects.”