BC Premier Christy Clark not working hard enough for LNG fracking, energy expert says

Premier Christy Clark has been busy promoting Liquefied Natural Gas (LNG) recently: she just came back from touring Asia to promote BC's LNG projects, and even suggested that the province's stringent climate targets can be compromised to pave the way for the industry.

Environmentalists decry the high cost of LNG (which involves hydraulic fracturing, also known as “fracking”) in terms of polluted water, massive power requirements and skyrocketing carbon emissions. Yet one energy expert believes Clark is not working nearly hard enough for their interests. 

OilWeek.com called the Calgary-based Ziff Energy Group "one of the foremost research firms tracking the natural gas sector."

“They're still slow and archaic. They complain about budgets. They're not with the program yet. They have to spend the money and get staff to manage it properly."

Gwozd was at the summit to discuss the lucrative potential for British Columbia to become Canada's largest gas producer. He noted that Northeastern BC had the highest potential for growth, and that gas production in the province could "double, triple, quadruple" in the near future. 

He gave a data-rich presentation full of colorful language, referring to news publications as "rags" on several occasions. He forecasted that LNG in BC is poised for major growth in the upcoming years, due to its easy access to premium markets in Asia.

Kitimat "smack on the money" for LNG

“Folks in Kitimat have the right location. They're smack on the money. They're in areas where they're going to grow,” he said, noting the importance of BC's location on the Pacific Coast. “They have an unfair economic advantage over their counterparts in Gulf of Mexico.”

In his view, Northeast BC will experience an economic boom, the place where his fellow Albertans move for jobs.

"Northeast BC will grow. It's the place where Albertans will migrate to, and the Alberta government will migrate to the BC ministry. Alberta will shrink for gas potential, and BC is going to grow," he said.

Clark plans to have three LNG plants up and running by 2020, but Gwozd thinks the BC government is moving too slowly on this. The project could face significant political opposition because of its environmental consequences. A single LNG terminal and pipeline could put an estimated 3.4 million tonnes of carbon dioxide into the atmosphere per year. Currently, the province is bound by law to cut greenhouse gases by 33 per cent below 2007 levels – also by the year 2020.

Those environmental consequences include vast amounts of water and electricity to produce it and huge amounts of greenhouse gases in production and final burning of the gas. In addition, much of the shale gas produced in BC is currently destined for Alberta, where it is used as fuel in the tar sands. 

Expansion of BC shale gas would require access to between two and three times the power produced at the proposed Site C dam on Peace River. BC fracking operations are already setting industry records for water use with nearly 1.5 million cubic metres or 600 Olympic swimming pools’ worth of water used at some fracking sites. The water becomes highly toxic after use in fracking, and contaminates the water it merges with when it gets pumped underground again. Regarding greenhouse gas emissions, two recent studies have concluded that if shale gas production in BC goes forward according to industry plans, BC’s greenhouse gas emissions are poised to skyrocket.

Asia's choice: buy BC gas at premium, or "freeze in the dark"

"Our grandmothers and grandfathers in the US will freeze to death and we will move those exports to Asia," said Gwozd, noting the likelihood of Canada taking advantage of premium gas prices overseas. 

He said countries like Japan and South Korea would have to pay an oil-equivalent price for natural gas because they did not have the good fortune to "have had critters die underground for them.” Comparing the Asia-Pacific region to a man in the desert paying high prices for a can of Coke, he said that Asian customers could either "freeze in the dark" or agree to pay much higher prices than their counterparts in North America. 

Gwozd also spoke about pipeline projects in BC and Alberta which had been slowed down due to environmental pushback.

“Pipeline companies, in their very bureaucratic ways, have been sleeping at the switch and didn't fully address [environmentalists’ concerns] at the very beginning,” he said. “They should have been on the ball to make sure those problems didn't arise in the first place. I know some other companies are actively finding alternatives, but I would like to be part of the 'make it happen' folks, rather than ask at the end, like my Premier in Alberta, ‘What happened?’ when Keystone XL didn't go through.”

This was the wrong question for Alberta Premier Alison Redford to ask, he said. “She should have been on the ball.”

NDP: getting "educated" for the oil and gas future 

As for the NDP, many in the room seemed worried that BC NDP leader Adrian Dix – who is polling significantly higher than BC Liberal Premier Christy Clark – may not support projects like LNG and Northern Gateway. Dix noted in a recent interview with journalist Rafe Mair that "LNG makes sense" for BC's public interest, whereas Enbridge's Northern Gateway doesn’t.

However, Gwozd had an optimistic view. He suggested that the federal NDP may yet turn out to be in favour of LNG development despite party leader Thomas Mulcair’s concerns about energy development projects in the past.

“The NDP party in Ottawa is wondering what's happening,” he said. “They need to get on this wagon to see how to create this economic momentum and support these kinds of projects. These projects have the economics behind them and they should go forward ... The young fellow in Ottawa [Mulcair] for the NDP party — is just watching what's happening and wondering. This is more of an educational thing and I think the associations will help train him and help educate him.”

With a knowing smile, he added: “They have new educational programs for training government officials, and he'll probably get on that program."

This article is the third in a series. For more, please refer to: Koch brothers' "ideological twin" in Vancouver to strategize with oil industry and Pushing Enbridge pipeline through without First Nations consent.