Energy companies are expected to spend billions of dollars building natural gas pipelines and liquefied natural gas (LNG) export terminals in northern B.C. during the next decade.
For small and medium-sized resource sector and construction firms in the north, tapping into the development of LNG is both an opportunity and a serious challenge.
"There is nobody in Prince George that builds pipelines. There is nobody in northern B.C. that builds pipelines. But there are people who work to support the projects," Dick Mynen, president of TDB Consultants, said. "We're a resource-based company - this is what we do. [But] in some ways we're too small. Petronas doesn't call up TDB Consulting."
The Prince George-based company has been working for 27 years supporting the forestry and resource sectors, and currently employes about 50 people.
While major energy sector players like Petronas and TransCanada don't call companies like TDB Consulting, their contractors and subcontractors do, Mynen said.
"We're working very hard on the route access, route selection process. We want to help them find the route for their pipelines," he said. "Our specialty is transportation design: roads, bridges... Once the pipe hits the back the truck, we're done."
Mynen said TDB has been working to be ready when the LNG boom comes.
"We have been gearing up, adding capacity, getting more professional... adding professional engineers, professional foresters... That's not an overnight type of thing," he said.
Hiring those additional professionals has been a challenge, however. When asked what challenges his company is facing, Mynen summed it up in one word: labour.
"The word is out there that northern B.C. is getting developed," he said. "You always lose a few [workers] to other projects. And just through attrition, you lose people. Finding those replacements - any replacements -is a problem. You don't find people in [Prince George] anymore. You used to be able to scoop grads from [the College of New Caledonia] and [University of Northern B.C.]"
TDB has had to change how it recruits to fill positions, he said, with recent hires coming from Vancouver, Ottawa and Halifax.
"There are a lot of things you have to do, and you can't do it last minute. If you're not already in dialog when the announcements are made, it's too late."
The lead time for major projects can be years and work begins long before final government approvals and company investment decisions are made, he added.
Eight years ago, TDB did some aerial photography for what is now Chevron and Apache Canada's Pacific Trail Pipeline project. The final investment decision for the proposed 487 kilometre pipeline from Summit Lake to Kitimat still has not been made.
Mynen said he doesn't expect natural gas development and LNG to redefine his company, but "it's exciting times."
BUILDING THE BOOM
Gary Giese, operations manager for Prince George-based construction company High Caliber Contracting, also sees exciting times ahead.
High Caliber is a small construction company, employing up to 56 people. Giese said the biggest crew he's ever had on a single job is 27 people -but that could change.
"If it wasn't for the LNG, we'd look at a growth curve of 30 per cent year, 40 per cent per year," he said. "But what I see coming up is 100 per cent growth every year. We did a million last year, we're looking at $2.5 million this year and [could be] looking at $4-4.5 million in a year's time."
Giese said High Caliber is "putting all the pieces in place" to ensure the general contractors and major subcontractors know the company is ready and able to take on subcontracting work.
One of those steps included completing the Browz safety program, he said. Browz offers contractors a searchable database of compliant contractors in each area.
In addition to working directly on LNG projects, Giese said he expects to end up working on projects resulting from the increased economic activity in the north.
"The spinoff is going to be incredible, too," he said. "There is nothing that has ever happened in B.C. [like this]"
COMING SOON
If TransCanada and its partner Progress Energy Canada Ltd. have their way, work on the 900 kilometre Prince Rupert Gas Transmission project from Hudson's Hope to Lelu Island in Port Edward could begin as soon as next year, according to TransCanada Prince George regional manager Dave Kmet.
TransCanada applied for approval to the B.C. Environmental Assessment Office (EAO) in May.
"[Pending approval] we'd like to start clearing with pioneer camps in 2015. That would start on major clearing by August 2015," Kmet said.
The proposed 48-inch diameter pipeline would initially transport two billion cubic feet of natural gas per day to the Pacific NorthWest LNG terminal proposed on Lelu Island. With additional compression the capacity could be increased to 3.6 billion cubic feet of gas per day.
TransCanada hopes to begin constructing the pipeline in 2016, with the goal of having it in service by 2018.
Prince Rupert Gas Transmission is just one of four natural gas pipelines TransCanada is working on in northern B.C., Kmet said. The company is also working actively on the Coastal GasLink Pipeline Project and two mainline extensions: the North Montney Mainline and Merrick Mainline.
TransCanada anticipates spending $14.5 billion on the four projects, Kmet said.
"There will be employment opportunities with these projects, and contracting opportunities," he said. "We are engaged in skills training and education with local institutions. Our focus will be in preparing students for jobs on the pipeline."
TransCanada is not the only company looking to begin construction within the next couple years.
Chevron Canada and Apache Canada have EAO approval in hand for their proposed 463 kilometre Pacific Trail Pipeline from Summit Lake to Kitimat. The partners are expected to announce their final investment decision on the project by the end of the year.
Final investment decisions on the proposed LNG Canada terminal in Kitimat and 650 kilometre Coastal GasLink Pipeline Project linking the terminal to Dawson Creek are expected next year.
In addition, Spectra Energy applied to the EAO for approval of its Westcoast Connecter Gas Transmission project - an approximately 854-kilometre-long pipeline from northwest of For St. John to the proposed Prince Rupert LNG export facility on Ridley Island - on March 21.
EARNING TRUST
Whether LNG projects get built will depend as much on market conditions, and the level of public support or opposition, as government approval.
Enbridge's proposed Northern Gateway pipeline to transport oil from the Alberta oil sands to a marine terminal in Kitimat received federal government approval this month.
According to a recent Angus Reid poll 34 per cent of Canadians and 40 per cent of British Columbians polled believe the project should not have been approved.
Vocal opposition from First Nations and environmental groups means the project is expected to face legal challenges, protests, blockades and potentially a citizen's initiative petition against it if the provincial government approves the project. Federally the NDP and Liberal Party have vowed to overturn the federal government's approval if elected in 2015.
Provincially, the B.C. NDP is opposed to the project, and the B.C. Liberals have said the project has not demonstrated it meets the five conditions required for provincial approval.
LNG projects have not drawn the same level of public criticism as the proposed oil pipeline, but Kmet said TransCanada has been working with First Nations and communities along the proposed route to earn public support.
"We didn't just look at one 900 kilometre route, we reviewed over 2,000 kilometres of routing, "Kmet said. "Our business exists to deliver gas safely to homes and businesses. [The project] needs social acceptance, it needs community support and it needs to be environmentally responsible."
