Canada Approves Petronas Pacific NorthWest LNG Project
The Canadian government has given the final green light to Petronas' much-delayed Pacific NorthWest LNG project after what it said was “a rigorous federal environmental assessment.”
In March, the Canadian Environmental Assessment Agency (CEAA) was granted an extension to complete the study of the project.
The news will come as a relief to Asian stakeholders in the project such as India and Japan. Both Indian and Japanese governments have been urging Canada to speed up the environmental clearance for the project. Only this month, Indian oil minister Dharmendra Pradhan met with Canadian natural resources minister James Gordon Carr in New Delhi and urged him to clear the project at the earliest opportunity.
Japan too has been piling on the pressure. Petronas, Sinopec, Japex, Indian Oil Corporation, Petroleumbrunei and Mitsubishi Gas Chemical Company (MGC) are all shareholders in the LNG project.
In a statement released September 27, the Canadian government said the Pacific NorthWest LNG project is a major opportunity to grow the economy, creating an estimated 4,500 jobs and an additional 630 direct and indirect jobs during the operation of the facility. The project is subject to over 190 legally binding conditions, determined through extensive scientific study, that will lessen the environmental impacts of the project, the government said.
"The only way to get resources to market in the twenty-first century is if they can be done in a responsible and sustainable manner. This decision reflects this objective. With the legally binding conditions we are putting in place and with British Columbia's commitment to increase its price on carbon in line with the Pan Canadian Framework, I am confident that we will minimise the environmental impacts of the project and ensure that it proceeds in the most sustainable manner possible," the minister for environment and climate change, Catherine McKenna, said.
Pacific NorthWest LNG is proposing to construct and operate a LNG facility and marine terminal near Prince Rupert, within the District of Port Edward. The facility would be on Lelu Island, converting natural gas to LNG for export to Pacific Rim markets in Asia.
"This is an exciting day for British Columbia, for Canada and for the natural gas industry in this country,” Carr said.
In April, Petronas said a final decision on project would depend on the government. However, some First Nations and environmentalists have been opposing the project over its impact. Apart from resistance from local communities, the project faces other difficulties as well, the biggest one being low energy prices. This summer, Shell abandoned its plans to build an LNG export plant, also in British Columbia, in the context of the persisting LNG oversupply and low prices.
Shardul Sharma