Over the next 30 years, B.C.'s energy industry is projected to generate as much as $1 trillion of wealth for the province.
Spectra Energy is already a major player as the province's largest producer of natural gas, and with expanding markets looming on the western horizon it wants a bigger slice of that pie.
Spectra is proposing an $8 billion, 850-kilometre natural gas pipeline from northeastern B.C. to Prince Rupert. The company wants to begin construction in 2015 with completion of the project expected by 2019. The new pipeline would be capable of moving 4.2 billion cubic feet of gas per day.
"We've had a lot of support for the concept," said Doug Bloom, president of Spectra's Western Canada operations.
"Natural gas is seen as a clean-burning, environmentally-friendly source of energy and something people in B.C., knowing we have a vast resource here, tend to take some personal ownership of it and see it as their resource."
The gas would be sent to a liquefaction terminal in Prince Rupert operated by BG Group of England, which would load it as a liquid into tankers to be shipped overseas.
"The pipeline we're proposing goes through the mountain ranges and across some relatively remote terrain in British Columbia, but it's not something we haven't done before as a company -- we built the original pipeline to Vancouver Island," said Bloom. "But it's a big challenging job."
The pipeline is still early in the planning stages and Bloom said the project is still two or three years away from the approval stage. For that to happen, the Houston, Texas-based company intends to focus on consultations with communities and First Nations along the proposed route and it will continue to work through the permitting and regulatory process.
"We're doing a lot of work on the technical side with engineering and design work and right now the estimated cost of the project has a relatively wide band to it so we intend to narrow that down over the next two or three years," said Bloom. "When we get to the middle of the decade we plan to make a final investment decision and assuming we're ready to go, then we'll move into construction.
"We think Prince George is very well positioned to support the construction and ongoing operation of this project. It is already an important centre for us in our pipeline business and we've had a big operation here for many years. This is a big regional centre that can provide a lot of the support and services and materials that are going to be instrumental in making this happen."
Currently there's a glut of natural gas in North America, where hydrological fracturing (fracking) technology has allowed companies to tap into shale natural gas deposits. Market prices in North America are in the $2 per gigajoule range, but in China and other Asian markets the commodity is being sold for between $14 and $18 per gigajoule. The estimated cost to ship liquefied gas to Asia is about $4 per gigajoule.
"What we expect for the longer term in North America is relatively low [prices], hopefully not quite as low as they are now because they have to be higher to really sustain economic activity," said Bloom. "We expect natural gas to be relatively modestly-priced and abundantly available for decades to come and therefore we think developing new markets is going to be really critical to help give added impetus to more development."
Spectra has a long history of building and operating pipelines and natural gas processing plants in B.C., dating back to 1957 when it was known as Westcoast Transmission and built the country's first large capacity pipeline from northeastern B.C. to the Lower Mainland. Spectra now processes and transports 60 per cent of the natural gas produced in B.C., through a 6,000-kilometre network of pipelines.
"Our pipeline's going to be there for decades, just like our original pipeline that has been there for 55 years and going strong," said Bloom. "When we come through we intend to do this right and will monitor the condition of the pipeline on a 24/7 basis through two control centres and we'll make sure we know exactly what going on in out pipeline system at any time of the day."
Pat Bell has done the math and can't help but dream about what a trillion dollars would do for the provincial economy every year. Bell, B.C. Minister of Jobs, Tourism and Skills Training, put that into perspective when he told a UNBC audience Friday that the province's entire education budget amounts to about $2 billion per year.
Knowing that Spectra Energy Corp. is the largest property taxpayer in B.C., contributing close to $65 million per year, Bell was unable to contain his optimism over Spectra's proposed pipeline.
"This is an enormous opportunity for northern British Columbia, liquified natural gas is just the front end of an expansion that could lead to a trillion dollar industry -- that's five times the gross domestic product of the province every year," said Bell.
"I think it would far outstrip the building of the dams and the whole opening up of British Columbia that W.A.C. Bennett did with the highway system. Economically, this could propel us to a new place. That pays for healthcare, pays education, pays for transportation and and social services."
Unlike Enbridge, which is being put under the environmental microscope over its proposed Northern Gateway Pipeline for carrying crude oil through northern B.C., Bell said there are fewer public safety concerns and fewer environmental threats involved in natural gas transmission.
"Spectra is a credible company with a good safety record and they work well with First Nations," said Bell. "Generally, people perceive if there is a problem with a natural gas pipeline it gets identified quickly and it evaporates quickly into the atmosphere. It's not the same as losing oil and tanker traffic. When you have liquified natural gas and if a tanker happens to run aground and splits open, it will turn from liquid to gas again and evaporates."
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