Building to scale

Nineteen LNG (Liquefied Natural Gas) export facilities are proposed on the B.C. coast although no one, not even the B.C. government, believes more than five will get built. The scale of the ramp up in gas production to meet the needs of even five terminals would require:

Doubling Canadian gas production from 2014 levels by 2035, at which time half of all Canadian production would be exported as LNG.

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Increasing B.C. gas production to more than five times current levels by 2035, if the gas for export was sourced entirely within B.C.

Increasing the footprint of gas production infrastructure from the 25,000 wells that have been drilled in B.C. since 1954 to 68,700 wells by 2040, along with the inevitable environmental impacts that would entail.

These requirements were the subject of an analysis I conducted of various LNG export cases, released in May by the Canadian Centre for Policy Alternatives. The study emphasizes the need to develop a rational plan to meet Canada's future energy requirements, including a central policy question: "do we have enough gas reserves for LNG exports?"

The B.C. government maintains on its website that B.C. "has more than an estimated 2,900 trillion cubic feet of marketable shale gas

reserves". This was reiterated by Rich Coleman, Minister of Natural Gas, in response to my report.

If this were true, B.C. would have more gas than the entire United States, which was recently estimated to have 2,853 trillion cubic feet, including proven reserves and probable, possible and speculative resources.

In geological terms, "resources" are probabilistic estimates of natural gas volumes. They are termed "in place", when they sum every gas molecule in the ground, and "recoverable" or "marketable" when they refer to the portion that may be recovered with existing technology.

Typically, no more than 10 to 20 per cent of "in place" resources are recoverable from shale deposits, based on the U.S. experience where shale gas development is more advanced than in Canada.

In 2013, the B.C. Oil and Gas Commission, in conjunction with the National Energy Board, estimated B.C.'s "remaining marketable resources" at 376 trillion cubic feet, or one-eighth of the amount touted by the B.C. government as "marketable shale gas reserves".

"Reserves", unlike "resources", are recoverable with existing technology under current economic conditions. They have a much higher level of certainty as they have been proven with the drill bit. Proven reserves in B.C. as of the end of 2013 were only 42.3 trillion cubic feet, or one-seventieth of the "marketable shale gas reserves" touted by the B.C. government.

The fact that the B.C. government is grossly exaggerating the amount of gas available in northeast B.C. can probably be written off to boosterism trying to make B.C. look as good as possible and deflect the obvious questions from the public.

Given the choice between touting "in place" resources and much smaller "recoverable" resources, the government went with bigger is better even though the number is meaningless in terms of available supply, and failed to mention any caveats.

My report presented some hard facts on what would be required to meet the LNG export plans touted by the B.C. government, and it is unfortunate the minister responded only with exaggerations of the size of B.C.'s gas supply.

Does B.C. have enough gas to meet supply for five LNG terminals through 2040? The answer is maybe, given that five terminals would require recovering more than four times B.C.'s current proven reserves, but what happens after that?

Canada and B.C. need a long term plan recognizing that fossil fuels are a finite resource and their extraction necessitates very significant environmental impacts.

Ignoring inconvenient facts, as the B.C. government has done, is a disservice to the long-term energy- and environmental-sustainability of this country.

David Hughes has studied the energy resources of Canada and the U.S. for four decades.

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