The National Energy Board approved a licence to export liquefied natural gas (LNG) Thursday for the group behind a project to build an export terminal near Kitimat.
The board said it has approved an application by KM LNG Operating General for a licence to export up to 10 million tonnes of liquefied natural gas over a 20-year period.
In approving the application, the board said the quantity of gas to be exported does not exceed the amount required to meet foreseeable Canadian demand.
The gas would be transported to Kitimat via a 463-kilometre pipeline that would tie into existing infrastructure at Summit Lake just north of Prince George to a plant in Kitimat that would cool the gas into a condensed form for shipment overseas.
North America is currently awash in natural gas as new technology unlocks huge volumes from shale formations that had once been too costly to exploit.
An export terminal would allow the gas to be loaded on specialized tankers and shipped to Asia.
B.C. Jobs, tourism and innovation minister Pat Bell said it's "great news for our region" that will create good long term jobs in addition to "thousands" of construction jobs.
"This was critical that it happened quickly," Bell said.
"We are in competition in particular with Australia to ship liquified natural gas into China and the first one in wins and the decision by the National Energy Board I think really gives us the opportunity to be the winner here."
Bell said B.C. Hydro has enough existing capacity to provide electricity to this project and one more. The plants are essentially large-scale refrigeration units that cool the gas down to -162 C where it takes on a liquid form and make it cost efficient to transport via supertanker.
"We've been very clear about this, that we're not going to let power stand in the way between us and a vibrant LNG industry," Bell said. "So we have some options we are considering."
On environmental concerns, Bell said that if a ship were to run aground, the natural gas evaporates into the air, "and while that's not ideal it does not have the same environmental consequences as a bunch of oil going into the ocean."
KM LNG and its managing partner own a 40 per cent stake in Kitimat LNG and are the operators of the export terminal project.
EOG Resources Canada Inc. and Encana Corp.each own a 30 per cent stake.
The companies hope to have the project in operation by 2015 with an initial export capacity of five million tonnes per year and the potential to double.
The construction and operation of the pipeline and the terminal will require provincial regulatory decisions.
-- with files from Canadian Press
