Terrace city council holds off on gas pipeline support letter

Council first wants the province to agree to share industrial taxation revenue

Terrace city council voted last night to withhold a letter of support for pipeline developer TransCanada until after a meeting with the provincial government next week concerning a revenue sharing agreement with northern local governments.

TransCanada official Dave Kmet, who is working on one of two company northern natural gas pipeline projects, told council he is trying to raise a message of support from municipalities to counter the controversial and negative press generated by protests and opposition to projects.

“We have already received support letters from communities in Vanderhoof, Houston, Fraser Lake, Chetwynd, and Burns Lake,” he told council.

Kmet highlighted the employment the activity of his company has brought to the area with environmental and other work over the last three years, but noted that “to other places that are not in north central BC…the only thing you see is controversy.”

He said having support statements from communities helps the company make a more convincing case to investors that they should back the company with the billions necessary to get up and running.

TransCanada is anticipating a final investment decision by LNG Canada early next year to build a liquefied natural gas plant at Kitimat and TransCanada’s Coastal GasLink pipeline would feed that plant.

The company’s other northern gas pipeline, Prince Rupert Gas Transmission, would feed the planned Petronas Pacific NorthWest liquefied natural gas plant on Lelu Island near Prince Rupert.

Kmet’s request was put on hold when councilor James Cordeiro moved that any such letter should first wait until northern local governments meet with provincial officials next week to press their case for a share of the taxation revenues that would flow to the province from liquefied natural gas and other developments.

Cordeiro’s motion was supported by every councillor except Brian Downie.

“We should defer writing a letter of support until after that meeting,” said Cordeiro.

After the council meeting, Mayor Carol Leclerc called it a tactical move:

“We have not had any firm commitment from the province on our request for the Northwest B.C. Resource Benefits Alliance. This is a strategic move to hold the province’s feet to the fire.”

A revenue sharing agreement would bring a percentage of royalties from all industrial activity back to northern communities, and 21 municipalities and regional districts from Haida Gwaii to Vanderhoof have signed on under an umbrella organization called the Northwest B.C. Resource Benefits Alliance.

Downie voted against the motion to hold off support of TransCanada’s projects, saying it sends mixed messages.

“The motion contradicts positions this council has taken in the past,” he said. “I don’t think that’s fair to the project or the citizens of Terrace to play politics with two projects as serious and significant as these projects are.”

But councillor Stacey Tyers, who is also the chair of the Kitimat-Stikine regional district and the chair of the benefits alliance, said Downie was incorrect in his assessment.

“We have supported projects, and supported projects under the promise from the premier that our communities would see benefits from those projects, and by leaping ahead to writing letters of support before those commitments have come into place, that is doing our communities a disservice. We are here to represent our communities and our citizens, not independent projects,” she said.

As to whether TransCanada supports a revenue sharing agreement, Kmet said that his company encourages the province and the local governments to figure out any such agreement between themselves.

Members of the benefits alliance are to meet with provincial officials next week at the annual Union of BC Municipalties convention in Vancouver.