Artist’s rendering of Ksi Lisims LNG’s plans for two floating facilities that would produce liquefied natural gas, before the project deploys other vessels to export LNG from Pearse Island on British Columbia’s North Coast.Supplied
A pipeline project jointly owned by the Nisga’a Nation and a Houston-based company is seeking Indigenous equity partners as the B.C. government prepares to rule on the fate of the proposed route across northern British Columbia.
The provincial government is reviewing an environmental regulator’s draft report in order to render the decision on the future of Prince Rupert Gas Transmission (PRGT) Ltd., which would transport natural gas from northeast B.C. to the West Coast.
The BC Environmental Assessment Office’s 24-page draft report, obtained by The Globe and Mail, said PRGT is currently co-owned 50-50 by the Nisga’a and Western LNG.
“PRGT Ltd. stated that it created equity ownership opportunities for any First Nation,” according to the draft report. The pipeline project‘s co-owners also say they are committed to providing employment to Indigenous people.
Plans call for the 750-kilometre pipeline to supply the future Ksi Lisims LNG facility, which is undergoing an environmental review for exporting liquefied natural gas.
PRGT could cost between $10-billion and $12-billion to construct, said the draft report. The anticipated costs are sharply higher than previous estimates that were disclosed at $5-billion.
The environmental regulator said Gitanyow hereditary chiefs and other Indigenous groups such as the Kitsumkalum First Nation have expressed concerns about PRGT.
A floating production unit is to be constructed in South Korea for Ksi Lisims, which would build various other LNG infrastructure on Pearse Island on Nisga’a territory and aim to start exports to Asia in 2029. The construction costs alone for Ksi Lisims are expected to total $10-billion.
PRGT initially received its environmental assessment certificate in 2014, and won approval for a five-year extension in 2019, giving the project until last November to “substantially start” pipeline construction to prevent the certificate from expiring.
The Environmental Assessment Office prepared the draft report to inform provincial Environment Minister Tamara Davidson in making a determination on PRGT‘s future, notably whether the pipeline project meets the threshold for being substantially started.
“We expect a determination to be made in spring 2025,” the environmental office said in an e-mail to The Globe on Wednesday, noting that it “consulted First Nations throughout this process.”
Critics say the BC Energy Regulator unfairly allowed PRGT to clear 42 kilometres of the right of way last year along Section 5 on Nisga’a territory, and in any case, only a tiny portion of the entire B.C. route has been cleared.
“Gitanyow hereditary chiefs stated that the PRGT substantial-start determination poses significant impacts to Gitanyow rights,” the draft report said.
Ms. Davidson has the option to delegate the decision on the pipeline plans to Alex MacLennan, the environmental office’s chief executive assessment officer.
By March of 2017, the B.C. government had signed benefits agreements with 17 of 19 First Nations along the original, longer pipeline route, but Malaysia’s state-owned Petronas cancelled the Pacific NorthWest LNG joint venture in July of 2017.
The Nisga’a, Western and a group of natural-gas producers named Rockies LNG are partners in Ksi Lisims. On Monday, TotalEnergies of France said it acquired a 5-per-cent stake in Western and the French company also has the option to buy a direct 10-per-cent interest in Ksi Lisims.
The Shell PLC-led LNG Canada project is nearing construction completion in Kitimat, B.C., and will become the country’s first export terminal for the fuel by mid-2025. Two other B.C. projects, Cedar LNG in Kitimat and Woodfibre LNG near Squamish, are also under construction.
The contentious Coastal GasLink pipeline, operated by Calgary-based TC Energy Corp., will supply natural gas to LNG Canada. A group of Wet‘suwet‘en Nation hereditary chiefs has led a campaign opposing Coastal GasLink.
In mid-2024, the Nisga’a and Western acquired PRGT from TC Energy.
In its application last November to obtain a positive ruling on being substantially started, PRGT said LNG shipments from B.C. would help displace thermal coal that is being used to generate electricity at power plants in Asia.
“Once liquefied and shipped to growing markets overseas, Canadian natural gas presents a compelling opportunity to offset higher-emitting fuels like coal,” PRGT said.
As the U.S. trade war escalates, Canada’s fledgling LNG industry is looking to markets in Asia to help reduce economic dependence on the United States.
But a new study by Investors for Paris Compliance (I4PC), a climate-advocacy group based in Canada, said the benefits of LNG have been vastly exaggerated.
“LNG is too expensive to displace coal at scale, and even if LNG could affordably displace coal, it would not deliver substantial emissions savings,” said the study, which emphasized that most plans to export LNG from Canada’s East Coast have been cancelled.
I4PC said the remaining prospects for exporting LNG from the East Coast are dubious.
“The business case for developing new East Coast LNG projects to supply two key export markets, Europe and Asia, is weak,” said the study titled That Ship Has Sailed.