Fresh off the plane from Ottawa, Terrace Mayor Carol Leclerc said the northern delegation of seven B.C. mayors worked like a “well-oiled machine” when it came to lobbying federal officials on the regional $40-billion LNG Canada project.
From March 21 to 22, the delegation met with several federal and provincial representatives, including Natural Resources Minister Jim Carr, the chief of staff for the minister of finance, and Burnaby North-Seymour MP Terry Beech.
“They were so glad to hear our stories and it felt like everybody was rowing the boat in the same direction,” Leclerc said.
On March 22 Premier John Horgan announced the government has offered incentives for the Shell-led liquefied natural gas (LNG) project in Kitimat, announcing the project would be exempt from provincial sales tax for is construction, and the previous government’s income tax on LNG sales would be removed. Prior to the announcement, the northern B.C. delegation received a heads-up phone call from B.C. Energy Minister Michelle Mungall.
“We had a reputation before we got to our meetings because it felt like they knew we were a delegation to be reckoned with,” Leclerc said. “They were teasing, but they knew that we were there and they knew the significance of the message that we were bringing.”
Horgan hopes the exemptions will lure Shell into making a final go-ahead investment decision on the project, which is expected to create between 4,500 to 7,500 jobs during construction and employ up to 800 people permanently if the full project is built, according to LNG Canada.
Horgan said the province would need to know by November if LNG Canada plans to take the tax subsidies and offers made to them, but Leclerc said she is staying optimistic about the project moving forward.
“There’s a lot of complexities to get the biggest, the largest private investment ever in Canada done but there’s a lot of different departments trying to make this thing happen,” Leclerc said. “LNG Canada has listened carefully to all these concerns and they have done everything they can to mitigate the risks.”
With the November deadline, the Shell-led project should make an investment announcement later this year. According to information from the province, the project would produce the lowest amount of greenhouse gases for an LNG facility of this size in the world, which Leclerc said is good news for the city.
“When Kitimat does well, Terrace does well,” Leclerc said. “We know that about 25 per cent of the people who work at Rio Tinto live in Terrace and the Greater Terrace area, so one could surmise that when [LNG Canada] gets to the operational stage, maybe a quarter of the people will live in Terrace as well.”
The city’s population numbers could spike if the project gets the green-light, which could mean the city will face some growing pains ahead when looking at previous industry development projects.
In 2014, Kitimat faced some problematic accommodation issues with the Rio Tinto modernization project when the mining corporation had to lease out a converted Baltic ferry to house 500 facility workers. Environmental concerns also played out in organized protests held in Terrace the year before, which spoke against Rio Tinto Alcan’s plan to increase its Kitimat aluminum smelter emissions as part of the company’s $3.3-billion overhaul.
“We know that it’s going to be a tidal wave during the construction period but we have to look past that tidal wave and know that you don’t want to overbuild for emptiness,” Leclerc said, referencing the 45 per cent vacancy rate left in Kitimat after the Rio Tinto Alcan project. “If there were 40 to 50 families that moved into Terrace, or 100 families, it would be good for the city.”
Global demand for natural gas is also increasing according to the B.C. LNG Alliance, with demands expected to overtake coal. “You’re going to make sure coal-powered plants aren’t opening up somewhere else because people are going to have an opportunity to get gas here,” Leclerc said.
“It might be a generation before another opportunity like this comes forward. We’ve got world-class natural gas, and now we just have to get it to market.”