Once again, B.C.’s northwest is in a waiting game

Prospect of LNG developoment in Kitimat or elsewhere still some years away

A constant mantra of economic development is that project proponents need “certainty” in order to move forward. Well, as far as the political landscape in B.C. is concerned there is a distinct lack of certainty at the moment.

The election saw the Liberals fall one short of a majority and the New Democrats and Green Party forge a deal that would allow the NDP to form a minority government.

So here is what is supposed to happen now.

Tomorrow the legislature will reconvene with the first order of business being to elect a speaker. By convention the Liberals, still being the government by virtue of having won more seats than any other party, will put forward one of their own for that post.

Then will come the Throne Speech in which the Liberals will outline what they plan to do as government.

I know, it is a silly charade given they will never get a chance to do any of it but everyone has to go through the motions to get to the result we all recognize is inevitable, the Libs will lose the vote on the speech and therefore cease to be the government and open the way for the NDP, through its coalition that is not a coalition with the Greens, to take the reins of power.

And when it comes to the development of an LNG industry in B.C., the Greens are absolutely opposed to it.

Yet in the wake of the election and deal Michael Crothers, president of Shell Canada, said that shouldn’t deter the company’s plans for the LNG Canada liquefied natural gas export project in Kitimat.

How does he get there? Simple. The Greens may be opposed to LNG, but with just three votes in the legislature they hardly control that agenda.

The New Democrats, despite being at times wishy washy on the potential industry, have said they don’t have a problem with LNG Canada and the same could be said of the Kitimat LNG project.

And after years of slavish devotion to the vision of LNG translating into a province awash with fiscal milk and honey, the Liberals are hardly likely to suddenly change.

Hence Crothers’ optimism that “we’ll get support if we choose to proceed.”

Of course the political situation is subordinate to the much larger and more critical factor in any decision to give the green light on the project: supply/demand and its sister, price.

There the numbers have been all wrong for quite some time with new Australian production and, to a lesser extent, LNG exports in the United States flooding the market. That’s taking the price of LNG to a level so low that there was no way you could justify spending billions of dollars on pipelines/LNG plants.

And that was precisely why last year Shell and its LNG Canada partners, PetroChina, Korea Gas and Mitsubishi, delayed any final investment decision on the project.

However, looking ahead – and multinational companies like Shell always work on the long term – Crothers is bullish, suggesting the market appears to be moving in the right direction as a result of China and India looking to LNG to replace burning coal.

While he did not offer up any date for a potential final investment decision for LNG Canada, he did point out four engineering firms have been asked to bid on contracts to design and construct the facility.

As always, the Northwest can only wait and hope.

FOOTNOTE: Although no party likes losing power, sometimes it is good for them. Winning election after election is great but the longer it stretches out, the greater the danger that the party gets complacent and starts to believe that they are the natural governing party. As was the case with the BC Liberals.

All credit to Christy Clark. She pulled off an amazing come-from-behind victory in 2013, but the result of this year’s election shows she is past her best by date.

Consigned to the opposition benches, the Libs would be well advised to take the opportunity to have a good long think about how they can rebrand themselves, the first priority being to select a new leader who can convincingly deliver on that brand.

And they have to do that quickly because it’s pretty much a given we will be back at the polls in two years max.

Retired Kitimat Sentinel editor Malcolm Baxter now lives in Terrace, B.C.