Company says it’s still planning to build a floating LNG facility near Bamberton despite a drop in natural gas prices
It was last August when Vancouver Island residents first learned about plans to build a floating liquefied natural gas facility in the Saanich Inlet.
A partnership between Vancouver-based Steelhead LNG and the Malahat First Nation, the facility would produce six million tonnes of LNG a year for export to Asian markets.
But now, six months later, the LNG industry is faltering and some are questioning whether the demand for projects like the one in the Saanich Inlet still exists.
“You’ve got a government that says it’s pursuing LNG but market conditions aren’t great for LNG at all right now and in climate terms it’s an absolute disaster,” said Tim Pearson with the Sierra Club of Canada.
But in Tuesday’s budget Finance Minister Mike de Jong was clear —
“We were and we continue to be optimistic about the creation of a new industry, a liquefied natural gas industry,” he said.
Steelhead LNG said the market is a challenge, but it is moving forward with the proposal, saying Canadian LNG has a lot to offer.
“Abundant low cost gas supplies from Alberta and British Columbia and a very close proximity to the north Asian market, primarily China and Japan,” said Steelhead LNG CEO Nigel Kuzemko.
Although the project is still in its very early stages, it has already been the target of protests and strong opposition.
“It’s important that what we’re looking at is full economic, environmental and social sustainability for our communities,” said Adam Olsen with the Saanich Inlet Network.
Olsen said with the market struggles LNG is facing, he doesn’t think the Malahat project will become a reality, but he doesn’t even want to see it approved.
“Then they can sit on it, they can flip it, they can do whatever they want with it, it’s to get this project through a regulatory approval, after that, it doesn’t matter, we can have this project hanging around us for 10, 15, 20 years,” said Olsen.
But the company says its shareholders have already invested a lot of money in the project and it has every intention of seeing it through.
“We have one clear objective and that’s to develop an LNG project in the most appropriate way a project should and can be developed in British Columbia,” said Kuzemko.
He said the company plans to submit a project description in the next couple of months and after lengthy consultation, environmental reviews, and local and international approvals, to have the facility up and running by 2022.