VANCOUVER — Walking through the northern B.C. town of Kitimat today, compared to two years ago is a difference of “night and day” said Dave Johnston, an electrician who has called the town home for five years.
There used to be empty storefronts in the mall, small businesses closing with regularity and a sense of unease at community events as much of the population reeled from the loss of pulp mill and aluminum manufacturing jobs. Today, a new clothing store has recently opened in the town of about 8,000 people, locals are signing up in droves for education programs and neighbours are fixing up their homes as they look toward another period of industry-driven prosperity for the town.
“The successes that we’re seeing on the social front and money being invested into that and education and business, people coming and probably people wanting to move there, it is all directly tied to the industry,” Johnston said. “Without it, this wouldn’t all be happening.”
But Liquefied Natural Gas, the industry now promising to bring an influx of jobs and activity to Kitimat, is now at the centre of a new national debate, with some claiming its future is tenuous.
Projects to extract the resource and export it internationally promise to transform communities like Kitimat with hundreds of high-paying, long-term jobs. But in a recent about-face, the federal Liberal government said it no longer considers LNG projects compatible with its emissions targets.
Plus, the industry is already suffering from declining sales due to oversaturation in the market — a far cry from the faith that was placed in the economic boom it could bring only a few years ago. In the latest twist, Chevron this week announced it would try to sell its 50 per cent stake in a trial Kitimat LNG project.
“There’s a tonne of jobs out there,” Kitimat Mayor Phil Germuth said in a phone interview Thursday, referring to the influx of economic activity that has followed two major LNG export projects now underway in the town. “Every restaurant, most small buildings, everyone’s looking for someone. Every piece of property that hasn’t been developed yet, there’s people looking at it.”
Kitimat is home to LNG Canada project — the single biggest private-sector investment in Canada of all time — and the smaller Kitimat LNG project. Hundreds of people have started working on the LNG Canada project since construction began in October 2018, and at its peak, the joint venture will employ 10,000 workers.
After the project is built, 950 permanent workers will be needed to operate the export facility — a boon for a community where economic activity has always depended on the presence of industry.
LNG Canada and Kitimat LNG also have agreements with First Nations along the pipeline routes leading to the export facilities, and the Haisla Nation Council has been a longstanding, enthusiastic partner in LNG Canada, with which it has education and employment arrangements.
B.C. Premier John Horgan and Albert Premier Jason Kenney have thrown their political weight behind developing the resource, based on the argument that it is a viable option to reduce greenhouse emissions.
But that argument has been weakened by Canada’s new federal environment minister, Jonathan Wilkinson, who reportedly told the Globe and Mail that there is a long road ahead of the LNG industry if it hopes to play such a role.
“That means a mechanism that avoids double counting, ensures transparency and promotes sustainable development,” Wilkinson said. “If we get this right, we can unlock opportunities for deeper emission reductions, help countries meet and exceed their targets and create opportunities to work with business to invest in technology and share the benefits.”
Industry has long argued that the burning of natural gas creates fewer emissions than using coal. And until now, the federal government has said exported LNG could count toward Canada’s own ambitious emissions targets.
The notion was that by selling LNG to coal burners like China, for example, Canada would be helping to reduce global emissions targets, at least on paper.
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At the Council of the Federation meeting in Toronto this month, the B.C. premier told reporters that his province and Canada should get credit for selling LNG to markets in Asia and India, because liquified natural gas will replace coal-fuelled plants and improve global air quality, the Vancouver Sun reported.
Alberta’s Kenney agreed.
But the role of natural gas in addressing global climate change concerns is uncertain. LNG demand may strengthen as economies become less reliant on coal — or demand could decline if renewable energy sources become more prevalent, according to a 2017 National Energy Board report.
The issue is murky, said Werner Antweiler, University of British Columbia economist.
LNG can provide a viable option to help a jurisdiction transition from fossil fuels to renewable energy, he said. Still, there’s a trade off. It does raise greenhouse gas emissions significantly during the liquification process.
To Johnston, the electrician from Kitimat, Wilkinson’s comments were out of touch.
“We have a country that has already signed on the dotted lines to bring Canadian LNG to replace coal (in other countries),” he said. “We can help the rest of the world. We have that ability, and we need these resources to get our people out of poverty.”
Johnston said he’s worked on several large projects in B.C. and Alberta as an electrician, and has seen firsthand the way an investment in industrial communities can be transformative.
According to B.C. Green Party Leader Andrew Weaver, the argument for credits — and the idea that LNG will offset coal emissions — simply does not hold water.
There’s been a lot of misinformation about what countries or companies can — or cannot — get credit for, he added.
And there are valid questions over whether LNG is actually better, or can offset coal, from an emissions point of view.
“There’s nothing there to allow you to get pollution credit and I see no future for you getting credit in Article 6. The fact that Mr. Wilkinson said that is refreshing. It’s truthful. It’s not up to Canada. It’s up to the international community,” he said.
“The whole argument never made any sense. This false hope was put forward by politicians and oil and gas companies.”
With files from The Canadian Press and Ainslie Cruickshank