Kitselas expect benefits from coastal LNG project

A term sheet signed Dec. 22 will lead to more negotiations with Pacific NorthWest LNG

A MAJOR energy company may be delaying its decision on whether or not to spend billions on a liquefied natural gas plant near Port Edward but that hasn’t stopped it from wrapping up business arrangements with local governments and First Nations.

The Kitselas First Nation and Pacific NorthWest LNG today announced an impact management benefits agreement term sheet has been signed.

It’s been described as an “integral step toward concluding negotiations and finalizing an agreement between the two parties.”

“Our agreement with Pacific NorthWest LNG addresses the environmental and social safeguards we require in negotiations, as well as the delivery of economic, employment and educational benefits for our community,” said Kitselas Chief Councillor Joe Bevan.

“These core components mean substantial benefits for our community – now and in years to come.”

Pacific NorthWest LNG concluded negotiations for a term sheet with the Metlakatla First Nation last week and has also reached a taxation agreement with Port Edward.

Pacific NorthWest official Krissy Van Loon anticipated the company signing up to six benefits agreements with First Nations who have interests in and around Lelu Island where the company wants to build its LNG plant.

“The Kitselas First Nation was identified as one of the First Nations with traditional fishing access in the Skeena River and near the Skeena estuary and it’s one of the groups we are working closely with,” she said.

There will be annual payments made to the Kitselas, Van Loon added, as well as a payment upon signing the term sheet.

The Kitselas have also agreed to provide a letter of support for the project which has drawn worries from environmental and other groups because of potential impacts on Skeena River fish populations.

Pacific NorthWest LNG, which is majority-owned by Petronas, the Malaysian state-owned energy giant, wants to build a LNG plant of two parts, each able to produce six million tonnes per annum of the super-cooled product.

A third part, also to produce six million tonnes per year, could also be built.

A final investment decision had been expected by now but the company in early December 2014 said that decision was on hold.

Company officials were generally happy with taxation arrangements worked out with the provincial government but cited declining energy prices and construction costs as reasons to delay its decision.