Gas-fired power plant could boost city fortunes

In his first column, Malcolm Baxter talks about the potential benefits of a gas-fired plant.

Over the years Terrace council has had a couple of notable successes in the realm of economic development by setting itself a not always obvious goal and relentlessly pursuing it.

The classic example for me was its drive in the last millennium to market the city as a service centre for the mining industry.

At the time I was The Terrace Standard reporter covering city hall and I have to admit I thought the idea was, shall we say, optimistic.

Back then Smithers was the acknowledged service centre for Northwest miners, which made sense given its relative proximity to actual mines. Terrace wasn’t remotely close to the action.

Nevertheless, council mandated then-councillor Danny Sheridan and economic development officer Peter Monteith to turn the idea into a reality.

The duo took to their task with gusto, attending all sorts of mining conferences, banging on doors and, no doubt, making something of a nuisance of themselves.

And it actually worked.

A couple of service companies located here and, even more astonishing, Terrace was named mining community of the year.

The results may not have been earth-shattering, but it proved what could be done if an aggressive approach was taken rather than sitting back and waiting to be “discovered”.

Fast forward some years and a new ec-dev officer, Ken Veldman, was given a new mandate – get us some big box stores. And as countless shoppers know, that one didn’t turn out too badly either.

I suggest recent developments  present Terrace with a new goal.

Liquefied natural gas is the big story these days with KM LNG, the BC LNG Co-op and Shell  all proposing to build plants in Kitimat.

There’s certainly no shortage of natural gas to feed these operations. Tests of a recent Apache Canada discovery – it is the majority player in the KM LNG project – suggest the play holds a staggering 48 trillion cubic feet of marketable gas – that’s enough gas to match Canada’s entire current output for nearly a decade.

But there is a shortage of power needed to run the Kitimat plants.

As reported in this paper May 30, BC Hydro says it can handle the power needs of the KM LNG and the much smaller BC LNG Co-op plants. But it needs new sources of power to fuel the Shell project – it is bigger than the other two put together.

While BC Hydro pays lip service to “renewable” energy such as wind and run-of-river, it recognizes the reality that a natural gas fired power plant may be needed to ensure a constant supply of electricity.

Granted, it touts the supply benefits of a Site C hydro-electric project on the Peace River, but it admits that would not come on-line for a decade – I suspect longer. And Shell wants to be shipping LNG by 2019.

So what the heck does this have to do with Terrace? Enter the airport lands industrial estate.

Shell bought the old Methanex methanol plant site for its proposed LNG facility.

While that site is big enough for the proposed liquefaction plant, it appears they will have to purchase more land to house a power plant to run it. Why can that gas-fired plant not be located on the industrial estate?

I am certain the City of Terrace would be motivated to sell a chunk of the estate and could therefore undercut whatever Rio Tinto Alcan, the primary landowner in Kitimat, would seek.

I suspect the geo-technical findings on an industrial estate site would be less daunting than those in Kitimat. And Terrace’s tax regime is more industry-friendly than Kitimat’s.

BC Hydro has already said it will have to put in a new powerline between the Terrace and Kitimat sub-stations to meet the needs of LNG.

Therefore there would be an outlet for power produced by an industrial estate power plant.

The benefits for Terrace are obvious: it would get an anchor for its industrial estate and a sorely needed increase in non-residential tax revenue.

I am sure I could think of a dozen reasons why this idea is lunatic. But then I thought the mining drive was equally nuts.

So, city council, why not give it a look? After all, nothing ventured, nothing gained.

With this column, Malcolm Baxter joins The Terrace Standard as a contributor. Recently retired as editor of The Northern Sentinel, Baxter covered the northwest for 25 years.